A Practical Approach for IT Governance

A Lesson in IT Management – A Confession (Part 3)

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To recap, I purchased a new home about an year and a half back, and in the process of completing my backyard, I was forced to switch vendors, and the governance model (from fixed fee to time and materials). In my earlier blog I had indicated I will share photographs, costs and a quick project sunset report including an assessment from my better-half. The photographs will have to wait as the backyard is not done-done yet, but like all IT projects, we have the urge to say we are done. What did I do? I broke up the backyard project into two parts: Part 1 included the concrete/stone work, lighting and plumbing, and Part 2 will be planting the flowers, trees, etc. Like all good managers, I re-scoped the original backyard project to include just Part 1.

Even with this clever maneuver, my cost variance was hardly favorable. Scope changes (modified designs, better materials) and contractor change resulted in significant overruns (50% overrun will not win me praise at home or at work). Again like all good managers I justified the cost variance attributing it to the scope changes. I even compared it with industry standards. For example, building a concrete slab wall with textured stone finish runs anywhere from $60 to $100 a linear foot. I proudly proclaimed brilliance by getting it done for under $40 a linear foot. I had a large area of travertine stone on my backyard, and a computed cost far below “so-called” industry standard costs (Note: industry costs were courtesy Google). Let us turn our attention to the project sponsor: my better half. Was she impressed? Not really. While she accepted the finished project with reasonable satisfaction, she always referred to the 50% cost over-run. The scope changes and quality enhancements were never given their due. Sounds familiar, does it not?

Written by Subbu Murthy

July 14, 2011 at 8:07 am

Posted in IT Governance

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