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December 14, 2012


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Good stuff H.

What a I still struggle with these days with regards to this topic is more transparency for all individuals and managers. It seems almost all issues with deadlines arise from not having a clear understanding of scope. Often assumptions are made at many levels, without clear communication of goals, intent etc causing time and work to be wasted. And in most cases management we not responsible for those unclear messages they often come from above or even changing markets underneath you so to speak. So I'm a real believer these days in over communication and as much transparency as humanly possible. But it also does not hurt to have "visionaries" and people willing to shift and change along with an attitude from the whole team to take responsibility to understanding all as spectra of a projects goals, deadlines and assets at hand.

The reflections here of course seem exclusively about software project management which I'm not going to pretend first hand knowledge of. Risk in investing means either plain ol' "chance of losing money" or if you're a theorist, volatility. If deadlines matter, the piece seems to say risk is missing the deadline by not delivering to the defined specs (because most frequently from a lack of trust?) If that's the case, is the cognitive load prescribed of constant questioning really helpful? Managers looking to avoid risk of missing deadlines just ask for more resources, irrespective of the inefficiency of the N+1 contributor, right?

Maybe I've misunderstood; interested in learning more could you give a practical example? Meanwhile I'll offer Peter Drucker's definition which I find helpful: "Management is doing things right. Leadership is doing the right things." Thanks for the post!

I was specifically making a reference to how in both fields aggregated outcomes of success don't lead to corresponding criticism and skepticism of practice. Thus, in aggregate, people who manage portfolios actively have a losing track record (vs., say, the S&P500) and, in aggregate, most software projects fail. Of course, that's easy to say and I'm not offering an alternative here... but just because no better alternative exists doesn't mean the current process is good :).

I get what you mean though. It's not really an apples to apples comparison beyond that. Primarily because unlike finance, in management there is no objective scoreboard like "made x% more than the S&P" which is unfortunate.

The corrolary to active vs. passive in investing would require some kind of intervention in order to have a positive impact. Obviously most investors either can't do that (few individuals have enough money) and most institutional investors won't do it (they just sell and buy something else). In theory the board of directors should represent the shareholder's interest in making management decisions, but given that most boards are appointed by the CEO (or similar executive), and most board members are minority shareholders and derive most of their income from salaries and bonuses, there are often significant conflicts of interest.

So, in the investment world it would be more like if you saw a company that had a lousy Return on Equity Investment; rather than just selling the shares you would interfere and attempt to improve the return by lowering project risk, increasing return, changing leaders,etc. in the same way that a great project leader will attempt to reduce risk and increase value.

Personally, I have found that there is A LOT of variation in software development estimates and if you build the removal of waste into the development process and you respect and empower your developers, much of this can be recaptured.

I don't know that much about the functioning of the finance world, but I expect that similar patterns exist in all human organizational structures.

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