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Feb 20, 2013 by Patrick Icasas in PM Best Practices & News

Being Too Frugal Can Hurt Your Projects

It’s good for businesses to be frugal and save money, but being too frugal can hamper your project management team’s productivity and hamstring your operations.

Pre-determined Hours

Projects can very easily run longer than anticipated, so some companies allow clients to buy pre-purchased hours for “spot” changes or last-minute tasks. Other companies keep a tight rein on a team’s hourly work to ensure they don’t run over. What both methods have in common is that once the team member hits the hourly allotment limit, he is required to stop work and wait for the client to approve additional hours.

While this policy prevents surprises on a client’s billing statement, it actually leads to much more expense for the client. Project management is not an assembly line—you can’t stop it and resume where you left off without some kind of transition. This is especially true if there is a long delay between work stoppage and the client approving additional hours. Can you imagine how frustrating this is for a team member who is doing QA or troubleshooting? He might be on the verge of a solution, only to run out of time and have to remember everything running through his mind when work resumes. The task would take much longer now than if it had been billed when completed.

A Day’s Pay for Two Days’ Work

Long hours are part of a project team’s everyday life, but that doesn’t mean employers can take it for granted. Many companies try to skip out on paying their teams overtime, especially when it happens on a regular basis. While it does save money, unpaid overtime can cause morale problems and opens the company up to legal issues.

You may want to consider different work arrangements, such as flex time, comp time, telecommute, etc. Or if your team is receptive to it, you can find alternate means of supporting them such as free food during extended hours, a team outing after project completion, or performance bonuses. The important thing is that your team members are properly compensated for the effort that they put in.

The Wrong Tools for the Job

Let’s face it: business software is expensive. Even so-called “budget” suites from Microsoft and Adobe, for example, can cost thousands of dollars. Multiply that by the number of employees who are going to be using the software, and you’ve broken the bank before getting your first client. There are viable low-budget alternatives, of course, but purchasing based on price may end up getting you tools that have missing or inadequate features, which ends up hampering your team instead of helping them. Plus, many designers and engineers have been trained on specific computer programs, and may have difficulty making the adjustment to something new.

Does your company try to save money in all the wrong ways? How so?

Image credit, DanielleCM, Flickr

 

patrick-icasas
Patrick Icasas

Patrick Icasas is a former marketing project manager with 7 years of marketing and PR agency experience, managing creative projects for brands such as Nokia, Verizon Wireless, and Adobe. He now spends his time helping people make the most out of their project management software and entertaining his 5 year old daughter.

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