You spent how much?

Having spent the majority of my commercial working life making magic happen with the thinnest of thin budgets, I find myself constantly astonished at the apparent ease with which companies blow budgets these days. And when I say blow…

Today’s Australian papers bring news of an IT initiative in the superannuation industry that’s gone a bit awry. It seems on the face of it a simple idea, something about building a back end for a heap of different funds to make it easier for them and their customers to interact. It’s probably an eminently sound and appropriate idea and there’s probably good reasons for it to cost a bit more than something off the shelf.

But the headline news today is that the project is $180 MILLION over budget. ONE HUNDRED AND EIGHTY MILLION DOLLARS.

How does that happen? At what point do the companies involved and heaven forbid the poor old client say “Tell you what fellas, we’re a few million/20 mill/50 mill over, might be time to have a bit of a think about this one”.

Because for me any successful business that I’ve ever worked for has that conversation when there’s a prospect of being ONE DOLLAR over budget. Because that’s what budgets are for, right?

The world is officially going mad. But when you can’t buy a house in Sydney for less than seven figures, what’s $180 million between friends?