It’s all about The Money.

From the view of the supplier/consultant/contractor/trainer: “I will do the work and I want to get paid in full”.

From the view of the client: “I will pay when I’m happy that the work is complete, and I get the results I want.

The Method

Much negotiation should take place here – seen by too many as time-wasting – but take another look at your last three failed projects; I’ll bet they failed because the goal was not stated accurately in terms that both parties could understand.

The cheque is going to be handed over WHEN the CEO is standing on top of the mountain, not before, so before we invest Johnny’s time and resources, it makes sense (“Is Rational”) to make sure that The Goal is well-defined and attainable. It is not rational (“In-sane”) to set off on the journey without a map.

Here is where the constraints creep in, as they should. Medical condition? Number of hours walking per day? Dietary restrictions? Er, how many people in the team?

The Goal will be reached by a series of steps, often called Objectives. Each step takes place in sequence. Starting with the left foot, then the right, then the left, until we reach the top of the mountain. Every so often we pause for rest. That’s called a milestone – we mark our position with an “x” on the map, and when we reach camp for the night, or ford a river, we call it a deliverable. We have achieved a point identified in advance of our journey.

We reach the deliverable either under or over budget (Boolean), and regardless of whether it is under or over, we discuss it.

Better to know about over-budget now, rather than get half-way up the mountain and run out of food.

Under-budget is as intriguing – is our surplus of food the result of leaving some team members behind, or of over-pessimistic concerns? Would we be better to leave a stockpile here and carry less with us?

Each deliverable should be specified within a pre-specified percentage – being over-or under-budget by 1% isn’t critical, but a 10% fluctuation is cause for a campfire discussion.

Related Download
Supply Chain Analytics for Dummies Sponsor: OpenText
Supply Chain Analytics for dummies

Register Now