LTYM - Spinning Gold

Letters to a Young Manager

Spinning Gold, #435
LTYM > Financial Management

Dear Sophie,

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There's an old saying that applies to many an organization's stance toward technology: a champagne appetite on a beer budget.

Do you remember the of story of Rumpelstiltskin? [1]. The maiden spun gold from straw for the king, in return for promising to give her first born to the manikin who granted her that power. Sometimes we are asked to spin gold from a straw IT budget. There are ways to stretch you budget [2], but at some point everyone needs to realize that you can't create something from nothing. As in getting from one place to another, you either have to buy the car or the ticket. Don't get stuck in the trap of promising the world (or your first born).

See the discussion questions for some hints on how to navigate.

***

Sincerely yours,
Ed

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[1] Grimm Bros, "Rumpelstiltskin", http://www.eastoftheweb.com/short-stories/UBooks/Rum.shtml
[2] See Nancy Luplin's book "Zilch" (below), for how nonprofits often make things happen on a shoestring budget. However, it nay be the only business editor that survives on donations!

Takeaways:

Creating something out of nothing is hard

Discussion Questions:

1) What's the one thing you need when you respond to IT requests with a cost estimate?
2) How do you build credibility for IT estimates? Are better estimates enough? What about a reputation for reducing costs?

For Further Reading:

1) Nancy Lublin, Zilch: The Power of Zero in Business, (Portfolio, 2010).