Re:The screen that set off the ballistic missile alert on Sa...
by TheOtherHobbes on Tuesday January 16, 2018 @11:01AM
(#16159106)
A failure to correctly price the difference between cost and value, in other words.
I'd be very surprised if the ultimate cost of this mistake isn't far higher than the added cost of adding an "Are you really sure?" confirmation option.
This is why you don't let accountants make cost decisions in a vacuum. Of course if you're counting beans, the cheapest option is best.
In reality-based accounting, the hidden costs, consequential costs, potential damages, and costs of failure guarantee that cheapest is risky if you're lucky, and suicidally expensive if you're not.
The GAP are not designed to analyse those costs, so stupid decisions are made, avoidable consequences occur, and ultimately money is wasted, not saved.
We're seeing the same thing in the UK now where a huge government services contractor has gone bust.
In the UK it's policy to give government contracts to the lowest bidder. This makes perfect sense, if you're clueless and have no idea what you're doing.
In other countries it's policy to offer contracts to the second or third cheapest bidder, because this encourages bidders to to put in estimates that mean they're more likely to finish the job without cutting corners, more likely to include realistic margins to keep their business afloat, and more likely to estimate unexpected costs realistically.
The UK's policy has completely failed to save money. It's going to cost hundreds of millions of pounds in direct costs, and probably more than a billion in consequential losses around the rest of the economy, to deal with the fallout from a wholly avoidable corporate drama.
I'd be very surprised if the ultimate cost of this mistake isn't far higher than the added cost of adding an "Are you really sure?" confirmation option.
This is why you don't let accountants make cost decisions in a vacuum. Of course if you're counting beans, the cheapest option is best.
In reality-based accounting, the hidden costs, consequential costs, potential damages, and costs of failure guarantee that cheapest is risky if you're lucky, and suicidally expensive if you're not.
The GAP are not designed to analyse those costs, so stupid decisions are made, avoidable consequences occur, and ultimately money is wasted, not saved.
We're seeing the same thing in the UK now where a huge government services contractor has gone bust.
In the UK it's policy to give government contracts to the lowest bidder. This makes perfect sense, if you're clueless and have no idea what you're doing.
In other countries it's policy to offer contracts to the second or third cheapest bidder, because this encourages bidders to to put in estimates that mean they're more likely to finish the job without cutting corners, more likely to include realistic margins to keep their business afloat, and more likely to estimate unexpected costs realistically.
The UK's policy has completely failed to save money. It's going to cost hundreds of millions of pounds in direct costs, and probably more than a billion in consequential losses around the rest of the economy, to deal with the fallout from a wholly avoidable corporate drama.