The meeting ended. Will picked up his pad, stood up, tossed his paper cup into the wastebasket, and stepped through the doorway right behind Janet. But before he could get her attention, Ed got his.
"Will, just one thing to button up — can you stop by my office a minute?" Ed asked.
"Sure," Will replied.
It was a short walk to Ed's office. They stepped in. Ed closed the door quietly. "Just want to give you the charge numbers for this week and next," he began. He handed Will a slip of paper that had two account numbers on it.
"Here they are. Top one's for this week, the other's for next."
"OK," said Will. "That it?"
"Yep. See you."
Will opened the door, went around the corner to his own office, set his pad and the slip of paper on his desk and sat. Odd, he thought. Why the secrecy? And why split the work across two accounts, when it was exactly the same work? He wondered what was going on.
helps you stay out of
the gray areaWill never did find out. Perhaps it was legitimate, but it might have been a "budget swap."
In organizations that track expended effort, people charge their time to various accounts, represented by charge numbers. When "actuals" deviate too far from projections, the manager is often considered to have erred. Managers of overspent (or underspent) accounts are tempted to move charges across accounts to compensate.
In effect, they "swap" money across accounts. Here are just a few forms swaps can take.
- Altering time sheets
- This approach is less common today, because so many organizations now use electronic time reporting systems. Systems that still use hardcopy are the most vulnerable.
- Directed or conspiratorial misreporting
- Ed and Will might be a case of directed misreporting. Typically, this requires a level of naiveté or fear on the part of the person who's being directed. Conspiratorial misreporting occurs when all parties are aware that they're reporting false data.
- In Parking, team members are temporarily detached from Project A, and then attached to Project B, which has adequate funding. Once parked, they may continue to do "just a little" work on A — a meeting, or a quick phone call, or more — but they charge all their time to B.
- Out and in
- When two budgets use the same external vendor for labor, equipment, or materials, the vendor can overcharge one of the budgets, and undercharge the other to compensate. Usually, this requires collaboration between the vendor and the managers. It's much easier to arrange when both budgets are controlled by the same manager.
Managers who use budget swaps to conceal problems do real harm to their organizations. But they harm themselves, too, because of another, less visible swap — their budgets for their integrity. Top Next Issue
For more about budgetary deception in the wider context, check out M. Jensen, "Paying People to Lie: The Truth About the Budgeting Process," European Financial Management, Vol. 9, pp. 379-406, September 2003. Available at SSRN.
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More articles on Ethics at Work:
- It Might Be Legal, but It's Unethical
- Now that CEOs will be held personally accountable for statements they make about their organizations,
we can all expect to be held to higher standards of professional ethics. Some professions have formal
codes of ethics, but most don't. What ethical principles guide you?
- When You Aren't Supposed to Say: II
- Most of us have information that's "company confidential," or possibly even more sensitive
than that. Sometimes people who try to extract that information use techniques based on misdirection.
Here are some of them.
- Approval Ploys
- If you approve or evaluate proposals or requests made by others, you've probably noticed patterns approval
seekers use to enhance their success rates. Here are some tactics approval seekers use.
- Telephonic Deceptions: II
- Deception at work probably wasn't invented at work. Most likely it is a continuation of deception in
the rest of life. But the technologies of the modern workplace offer new opportunities to practice the
art. Here's Part II of a handy guide for telephonic self-defense.
- The Costanza Matrix
- The Seinfeld character "George Costanza" is famous for having said, "It's not a lie if
you believe it." What if you don't believe it and it's true? Some musings.
See also Ethics at Work for more related articles.
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- Many people who possess real organizational power have a characteristic demeanor. It's the way they project their presence. I call this the power affect. Some people — call them power pretenders — adopt the power affect well before they attain significant organizational power. Unfortunately for their colleagues, and for their organizations, power pretenders can attain organizational power out of proportion to their merit or abilities. Understanding the power affect is therefore important for anyone who aims to attain power, or anyone who works with power pretenders. Read more about this program.