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.
Are your projects always (or almost always) late and over budget? Are your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around. Read 52 Tips for Leaders of Project-Oriented Organizations, filled with tips and techniques for organizational leaders. Order Now!
Your comments are welcomeWould you like to see your comments posted here? rbrenufcQqgTihsHQWmkMner@ChacqVvOpMJaLaXGeIUkoCanyon.comSend me your comments by email, or by Web form.
About Point Lookout
Thank you for reading this article. I hope you enjoyed it and found it useful, and that you'll consider recommending it to a friend.
Support Point Lookout by joining the Friends of Point Lookout, as an individual or as an organization.
Do you face a complex interpersonal situation? Send it in, anonymously if you like, and I'll give you my two cents.
More articles on Ethics at Work:
- Your Wisdom Box
- When we make a difficult decision, we sometimes know we've made the wrong choice, even before the consequences
become obvious. At other times, we can be absolutely certain that we've done right, even in the face
of inadequate information. When we have these feelings, we're in touch with our inner wisdom. It's a
- Email Ethics
- Ethics is the system of right and wrong that forms the foundation of civil society. Yet, when a new
technology arrives, explicitly extending the ethical code seems necessary — no matter how civil
the society. And so it is with email.
- Dubious Dealings
- Negotiating contracts with outsourcing suppliers can present ethical dilemmas, even when we try to be
as fair as possible. The negotiation itself can present conflicts of interest. What are those conflicts?
- Virtual Termination with Real Respect
- When we have to terminate someone who works at a remote site, sometimes there's a temptation to avoid
travel — to use email, phone, fax, or something else. They're all bad ideas. Terminating people
in person is not only a gesture of respect. It's good business.
- Some Truths About Lies: III
- Detecting lies by someone intent on misrepresentation is an important skill for executives, managers,
project managers, and just about anyone involved in knowledge-oriented organizations. Here's Part III
of our little collection of lie detection techniques.
See also Ethics at Work for more related articles.
Forthcoming issues of Point Lookout
- Coming November 29: Manipulators Beware
- When manipulators try to manipulate others, they're attempting to unscrupulously influence their targets to decide or act in some way the manipulators prefer. But some targets manage to outwit their manipulators. Available here and by RSS on November 29.
- And on December 6: Reframing Revision Resentment: I
- From time to time, we're required to revise something previously produced — some copy, remarks, an announcement, code, the Mona Lisa, whatever… When we do, some of us experience frustration, and view the assignment as an onerous chore. Here are some alternative perspectives that might ease the burden. Available here and by RSS on December 6.
I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenpWMoCWkQIlgcBUlsner@ChackYWFOkJrTjbDCgrCoCanyon.com or (617) 491-6289, or toll-free in the continental US at (866) 378-5470.
Get the ebook!
Past issues of Point Lookout are available in six ebooks:
- Get 2001-2 in Geese Don't Land on Twigs (PDF, USD 11.95)
- Get 2003-4 in Why Dogs Wag (PDF, USD 11.95)
- Get 2005-6 in Loopy Things We Do (PDF, USD 11.95)
- Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, USD 11.95)
- Get 2009-10 in The Questions Not Asked (PDF, USD 11.95)
- Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, USD 28.99)
Are you a writer, editor or publisher on deadline? Are you looking for an article that will get people talking and get compliments flying your way? You can have 500 words in your inbox in one hour. License any article from this Web site. More info
- Ten Project Management Fallacies: The Power of Avoiding Hazards
- Most of what we know about managing projects is useful and effective, but some of what we know "just ain't so." Identifying the fallacies of project management reduces risk and enhances your ability to complete projects successfully. Even more important, avoiding these traps can demonstrate the value and power of the project management profession in general, and your personal capabilities in particular. In this program we describe ten of these beliefs. There are almost certainly many more, but these ten are a good start. We'll explore the situations where these fallacies are most likely to expose projects to risk, and suggest techniques for avoiding them. Read more about this program. Here's a date for this program:
- The Power Affect: How We Express Our Personal Power
- 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.