The meeting ended. Will picked up his pad, stood up, tossed his paper cup into the wastebasket, and stepped through the doorway right behind Janet. But before he could get her attention, Ed got his.
"Will, just one thing to button up — can you stop by my office a minute?" Ed asked.
"Sure," Will replied.
It was a short walk to Ed's office. They stepped in. Ed closed the door quietly. "Just want to give you the charge numbers for this week and next," he began. He handed Will a slip of paper that had two account numbers on it.
"Here they are. Top one's for this week, the other's for next."
"OK," said Will. "That it?"
"Yep. See you."
Will opened the door, went around the corner to his own office, set his pad and the slip of paper on his desk and sat. Odd, he thought. Why the secrecy? And why split the work across two accounts, when it was exactly the same work? He wondered what was going on.
helps you stay out of
the gray areaWill never did find out. Perhaps it was legitimate, but it might have been a "budget swap."
In organizations that track expended effort, people charge their time to various accounts, represented by charge numbers. When "actuals" deviate too far from projections, the manager is often considered to have erred. Managers of overspent (or underspent) accounts are tempted to move charges across accounts to compensate.
In effect, they "swap" money across accounts. Here are just a few forms swaps can take.
- Altering time sheets
- This approach is less common today, because so many organizations now use electronic time reporting systems. Systems that still use hardcopy are the most vulnerable.
- Directed or conspiratorial misreporting
- Ed and Will might be a case of directed misreporting. Typically, this requires a level of naiveté or fear on the part of the person who's being directed. Conspiratorial misreporting occurs when all parties are aware that they're reporting false data.
- In Parking, team members are temporarily detached from Project A, and then attached to Project B, which has adequate funding. Once parked, they may continue to do "just a little" work on A — a meeting, or a quick phone call, or more — but they charge all their time to B.
- Out and in
- When two budgets use the same external vendor for labor, equipment, or materials, the vendor can overcharge one of the budgets, and undercharge the other to compensate. Usually, this requires collaboration between the vendor and the managers. It's much easier to arrange when both budgets are controlled by the same manager.
Managers who use budget swaps to conceal problems do real harm to their organizations. But they harm themselves, too, because of another, less visible swap — their budgets for their integrity. Top Next Issue
For more about budgetary deception in the wider context, check out M. Jensen, "Paying People to Lie: The Truth About the Budgeting Process," European Financial Management, Vol. 9, pp. 379-406, September 2003. Available at SSRN.
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More articles on Ethics at Work:
- Non-Workplace Politics
- When we bring national or local political issues into the workplace — especially the divisive
issues — we risk disrupting our relationships, our projects, and the company itself.
- Some Truths About Lies: I
- However ethical you might be, you can't control the ethics of others. Can you tell when someone knowingly
tries to mislead you? Here's Part I of a catalog of techniques misleaders use.
- Managing Personal Risk Management
- When we bias organizational decisions to manage our personal risks, we're sometimes acting ethically
— and sometimes not. What can we do to limit personal risk management?
- Personnel-Sensitive Risks: I
- Some risks and the plans for managing them are personnel-sensitive in the sense that disclosure can
harm the enterprise or its people. Since most risk management plans are available to a broad internal
audience, personnel-sensitive risks cannot be managed in the customary way. Why not?
- Telephonic Deceptions: I
- People have been deceiving each other at work since the invention of work. Nowadays, with telephones
ever-present, telephonic deceptions are becoming more creative. Here's Part I of a handy guide for telephonic
See also Ethics at Work for more related articles.
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- Many people who possess real organizational power have a characteristic demeanor. It's the way they project their presence. I call this the power affect. Some people — call them power pretenders — adopt the power affect well before they attain significant organizational power. Unfortunately for their colleagues, and for their organizations, power pretenders can attain organizational power out of proportion to their merit or abilities. Understanding the power affect is therefore important for anyone who aims to attain power, or anyone who works with power pretenders. Read more about this program. Here are some upcoming dates for this program:
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Amundsen reached the South Pole. Thirty-five days later, Robert F. Scott and four others followed. Amundsen
had won the race to the pole. Amundsen's party returned to base on 26 January 1912. Scott's party perished.
As historical drama, why this happened is interesting enough, but to organizational leaders, business
analysts, project sponsors, and project managers, the story is fascinating. Lessons abound. Read
more about this program. Here's an upcoming date for this program:
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