Why Finance Departments cling to Project Accounting

Tuesday April 17 Meeting

with David Hughes, longtime member, will be discussing

Show Me the Money: Why financial departments cling to project-based costing and how to move them toward Lean-Agile costing and decision making.

See documents at

http://www.agilephilly.com/forum/topics/accepted-value-costing  and

Annotated Bibliography.PDF 

This is a follow-on to our meeting on Fixed Price Agile Contracts from February

Cost accounting structures are complex, deeply entrenched based on long years of hard experience, and effective in satisfying executive decision makers. Ironically, they are very costly, as well. Project-based costing continues as the management accounting approach of choice within Agile transformations, even after two decades of proven success with Lean and Agile alternatives. In addition to the costly overhead, project-based costing contributes to delivery unevenness leading to waste mostly in the form of multitasking. It contributes to a mindset of anti-patterns resulting in overburdening of the people involved.

There is an easier way, and this presentation will recommend a field-tested approach based on activity-based costing techniques adapted to the Lean-Agile paradigm of fixed cost + fixed time + variable scope value stream delivery on a cadence. It will explore the valid reasons for resistance by financial and accounting departments to change in favor of pure activity-based costing, Beyond Budgeting, and Lean accounting. It will then present a field-tested integration approach which favors enabling Lean-Agile decision making over the mechanics of budgeting, time reporting, and variance tracking.

Attendees will leave with practical ideas which they can implement immediately using only a spreadsheet and bulk data export from an Agile Lifecycle Management tool such as CA-Rally, CollabNet-VersionOne, or Jira Agile.

This presentation will be about 60 or 75 minutes long.

Meeting Location Cerner in Malvern

Directions  http://www.agilephilly.com/page/directions-to-meetings#Cerner 

Speaker Bio - Info:

David Hughes has taught over 7,000 people world-wide since 2003, with prior college-level teaching experience at four universities. He has 37 years of professional experience, 20 of them with Lean and Agile approaches.

Popi (pronounced POPE-ee) Makris has taught over 1,500 people and facilitated over 100 large-scale events across the United States and Canada since 2010. She has over 20 years of professional experience with an emphasis on business process optimization and Lean-Agile methods.