Are you suffering from the Concorde Syndrome?
How do managers typically allocate a budget? They use last year’s budget as the baseline for the next year’s projection. However, there is an alternative: zero-based budgeting – so using zero as the baseline. This implies that every item in the proposed budget must be justified from scratch. The bad news is that this approach takes more effort. However, it also has many advantages: it efficiently allocates resources on the basis of needs rather than history, it uncovers exaggerated budget requests while drawing the attention to obsolete operations. So in fact, it encourages people to be clearer in their purpose and how their expenses align to a specific project.
Justify your time, energy and resources time and again
You can apply that principle of zero-based budgeting also to your own endeavours. Instead of trying to budget your time on the basis of existing commitments, just assume that all bets are off. Just start from the idea that all previous commitments are gone. And then begin from scratch – asking which commitments you would add today. You can do this for budget decisions, but also for specific projects you are committed to.
The point is this: every use of time, energy or resources has to justify itself again and again. If it no longer fits, then just eliminate it. Have the courage to uncommit. And those who are unwilling to do so, may suffer from the Concorde Syndrome.
The Condorde Syndrome
By any estimation, the Concorde jet was a striking achievement in aeronautical engineering. Aboard this passenger plane you could fly from London to New York in as little as two hours, fifty-two minutes, and fifty-nine seconds. That’s less than half the time of a traditional plane, making the Concorde the fastest passenger plane in the world. Unfortunately, it was also an extraordinary financial failure.
It consistently lost money for about four decades. But each time it went over budget, the French and British governments poured more and more money in. In spite of these efforts, the Concorde was never profitable. It may be very human: the more we invest in something, the harder it is to let go. The sunk costs for developing and building the Concorde were around $ 1 billion. In retrospect, we could say that both governments were suffering from the Concorde Syndrome: the believe that the more effort we put in, the more results we will see. Unfortunately, this is not always the case. Applying zero-based budgeting to your time, energy and efforts would definitely help to fight this syndrome… So have the courage to change course. Have the courage to uncommit.
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