Burn Baby, Burn

Like many specializations, Project Management seems to have gone from an informal skill to a near-religion, complete with gurus, esoteric jargon, strange designations and rituals, and increasingly complex formulas and calculations for the conceptually simple. Perhaps it is time to push the pendulum in the other direction.

I recently spoke with one of the purported gurus, who had a slew of initials after his name to denote his status in the project management mafia, and we were discussing the concept of burn rate. He was explaining the “new thinking” on burn rate, explaining complex formulas that produced a number like 0.348 to denote a project’s burn rate. What further confused the issue was that this number was not comparable like for like between projects. A 0.348 might be fine for one project, and a danger signal for another. What struck me most was that the outputs of this calculation are meaningless without interpretation from a project management witch doctor.

I have always seen burn rate as a simple number, the money you spend each day, week or month to keep a project or process operating. The subtle nuance is not in the formula that produces the number, but in ensuring you gather all your costs, from the obvious like implementation partner billings, to the more obscure like real-estate costs (those cube farms are costing someone money) and executive time. Anyone can understand the implications of a project that has burned $12 million, and is only predicted to bring about $6 million in benefits.

Project management, like any other business function should produce tangible benefits and help enhance the execution ability of your organization. Good ideas, from Agile Programming to Six Sigma have become a distraction when they morph into a religion within your company, demanding attention and homage at the expense of what should be your corporate “true religion:” your customers, products and markets.

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