Boom and Bust: Budgets & People

Budgets. Don’t we all just love them? And while we know they are necessary, their impact on the operations of many a business is disruptive. We hit Q4 with the budget requirement looming and all of the truisms that go with that deadline:

If you don’t spend all of this year’s, you’ll never get the same again for next year...

And so we open spreadsheets, try to remember accrual rules, search around for next year’s standard costs, ask questions about dependencies to which no one knows the answer. We make a best guess, based on a mixture of gut feel and an
estimate about what the business might want to prioritise, and we keep our fingers crossed that, at worst, we can keep the lights on and, at best, we can commit to delivering something of value.

The problem many will recognise is that this process has a direct impact on how we manage supply and demand. For most delivering change in which technology has a key part to play, we do so knowing that demand of ‘x’ requires supply level of ‘y’, where most of ‘y’ is people and the expertise they bring. Some of those people are employed by Big Bank. Many are contingent workers. Plenty are employed by one of the consulting firms or software suppliers without whom we couldn’t deliver new product. And the budgeting cycle I’ve been speaking about means that, while debate continues in the hushed corridors of power about how much funding to allocate to different value streams, we lose some of those people; not because we don’t need them, not because the business doesn’t think they are doing something useful, but because it happens to be December.

The way in which we manage external resources in particular tends to be yoked to the budget cycle. And the budget cycle in turn is yoked to the financial year.

You may or may not have noticed, but the 'Change as Usual' world of Agile delivery doesn’t care what month of the year you’re in. We need to decouple. If we want to build products in agile ways, iteratively delivering improvements and enhancements, we must stop thinking in terms of projects which have an end date and of budgets which lead us into the familiar pattern of “lose some people in December, not do much about it in January while funds are being allocated, take too long to replace the people and ramp up through to May and June, do three months work at slightly over what should be full capacity and then hit budget time again”.

This persistent cycle prevents us from one of our key Agile goals of: Continuous Delivery. If we can’t find a way to smooth the curve of supply we don’t just face the problem of the spike, we lose knowledge, we lose pace and we leave the business frustrated that we can’t deliver in the timeframe we would have achieved had we not had to align our skills management to the arbitrary measure of the Gregorian calendar.

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