
A test launch of an MX missile on 26 November 2002 by the U.S. Air Force. These missiles have all been decommissioned. One of the launch configurations of this missile was to have been mobile and land-based, though it was never deployed in that manner. The idea was patterned after the "shell game." That is, the number of launch silos was to have been far greater than the number of missiles, which would have made attacking them difficult, because the enemy would not know which silos actually contained missiles. This strategy would have reduced the need to harden them against nuclear attack. It's likely that the plan was abandoned, in part, because of advances in sensor technology that would have made detection of missile movements effective enough to degrade the advantages of this launch configuration.
What happened to MX is an example of the predator/prey pattern. As the predator develops new capabilities, the prey develops new defenses, in an endless cycle. So it is with budget swaps. You might get away with it when the amounts involved are small, but eventually, budget auditors will develop methods of detection.
Photo courtesy U.S. Air Force via Wikimedia.
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.
Knowing budgetary
deception techniques
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.
- Parking
- 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
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!
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.
Your comments are welcome
Would you like to see your comments posted here? rbrenfHlRlTgqCIXkUHBTner@ChacrEuHRQPYVKkOucGfoCanyon.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.
This article in its entirety was written by a human being. No machine intelligence was involved in any way.
Point Lookout is a free weekly email newsletter. Browse the archive of past issues. Subscribe for free.
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.
Related articles
More articles on Ethics at Work:
Difficult Decisions
- Some decisions are difficult because they trigger us emotionally. They involve conflicts of interest,
yielding to undesirable realities, or possibly pain and suffering for the deciders or for others. How
can we make these emotionally difficult decisions with greater clarity and better outcomes?
Telephonic Deceptions: I
- People have been deceiving each other at work since the invention of work. Nowadays, with telephones
ever-present, telephonic deceptions are becoming more creative. Here's Part I of a handy guide for telephonic
self-defense.
Some Truths About Lies: IV
- Extended interviews provide multiple opportunities for detecting lies by people intent on deception.
Here's Part IV of our little collection of lie detection techniques.
More Things I've Learned Along the Way: IV
- When I gain an important insight, or when I learn a lesson, I write it down. Here's Part IV from my
personal collection. Example: When it comes to disputes and confusion, one person is enough.
Vendor Mismanagement
- When we outsource knowledge work to vendors, we expect to achieve the desired result with less risk
and uncertainty than if we did the work ourselves. But mission creep, mission retrenchment and employee
capture can lead to less welcome results.
See also Ethics at Work and Ethics at Work for more related articles.
Forthcoming issues of Point Lookout
Coming April 30: On Planning in Plan-Hostile Environments: II
- When we finally execute plans, we encounter obstacles. So we find workarounds or adjust the plans. But there are times when nothing we try gets us back on track. When this happens for nearly every plan, we might be working in a plan-hostile environment. Available here and by RSS on April 30.
And on May 7: Subject Matter Bullying
- Most workplace bullying tactics have analogs in the schoolyard — isolation, physical attacks, name-calling, and rumor-mongering are common examples. Subject matter bullying might be an exception, because it requires expertise in a sophisticated knowledge domain. And that's where trouble begins. Available here and by RSS on May 7.
Coaching services
I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenfHlRlTgqCIXkUHBTner@ChacrEuHRQPYVKkOucGfoCanyon.com or (650) 787-6475, 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, )
- Get 2003-4 in Why Dogs Wag (PDF, )
- Get 2005-6 in Loopy Things We Do (PDF, )
- Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, )
- Get 2009-10 in The Questions Not Asked (PDF, )
- Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, )
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 500-1000 words in your inbox in one hour. License any article from this Web site. More info
Follow Rick
Recommend this issue to a friend
Send an email message to a friend
rbrenfHlRlTgqCIXkUHBTner@ChacrEuHRQPYVKkOucGfoCanyon.comSend a message to Rick
A Tip A Day feed
Point Lookout weekly feed
