Monday, February 4, 2013

Project Management - Delusional Optimism

"we over-emphasize projects' potential benefits and underestimate likely costs, spinning success scenarios while ignoring the possibility of mistakes."

Kahneman & Lewis

Those of us who work in the project management field know the struggle of getting accurate business cases and project plans approved. To get projects initiated the tempation is to overestimate benefits and underestimate costs. Project plans are written that reflect a world where the sky is blue, there is no rain and the birds are singing. Unfortunately in the real world such conditions rarely last long enough to see the project through and we are left with rising costs and declining benefits.

From long experience I know that projects over run for a number of legitimate reasons and these are not usually apparent at the initiation stage of the project. Given you are spending your own or someone elses money you need to be diligent to presnt a realistic cost-benefit situation. This may not be popular at the approval stage but when you do the post-implementation review you will be able to show that you completed (usually :)) within your project contingency.

DK

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