I had this explained once by a civil engineer planning highway work. He said that teams who finish on-time and on-budget charge more. Newer teams less likely to meet requirements charge less to account for the higher risk. So it’s a risk vs. cost curve.
In civil engineering, risk is taken seriously and the cheaper pitches are less-often taken. In IT, decision makers don’t yet understand the risks so they always accept the lowest bid.
The interesting thing is that the technology to bypass this problem exists. There are early completion bonuses and late completion penalties. Both were available for the MacArthur Maze in Oakland, California.
That project finished rapidly. The reason for that is that it was important.
Most infrastructure is unimportant. We don’t need it. There is no marginal economic gain to it that justifies the spend (in time, and money) unless accounting for the political support provided by local pressure groups.
Comments
I had this explained once by a civil engineer planning highway work. He said that teams who finish on-time and on-budget charge more. Newer teams less likely to meet requirements charge less to account for the higher risk. So it’s a risk vs. cost curve.
In civil engineering, risk is taken seriously and the cheaper pitches are less-often taken. In IT, decision makers don’t yet understand the risks so they always accept the lowest bid.
The interesting thing is that the technology to bypass this problem exists. There are early completion bonuses and late completion penalties. Both were available for the MacArthur Maze in Oakland, California.
That project finished rapidly. The reason for that is that it was important.
Most infrastructure is unimportant. We don’t need it. There is no marginal economic gain to it that justifies the spend (in time, and money) unless accounting for the political support provided by local pressure groups.