Warring Against Organizational Failure

Ted Hardy -

This post originally appeared August 11, 2011 on BetterProjects.net


I’m not a fan of Michael Arrington of TechCrunch. Leo Laporte, famous face in technology circles and all around really nice guy, doesn’t think very highly of Michael, either. (Warning, a small bit of NSFW language included).


It takes a lot to make someone as nice as Leo get that mad. Still, even a jerk like Arrington can, on occasion, really get something right. He did so recently with this piece on why the expense reporting process at his parent company, AOL, is so terribly restrictive.
Last night, for example, I was cleaning up my desk. I have an envelope I keep business expenses in. There was a hotel bill for a trip when my AOL issued credit card was turned off for the day. Some taxi expenses and a restaurant bill. I looked at them, thought about the process for turning those expenses in and then having to defend them via a phone call (Heather would probably save me from this, but there goes an hour of her time). So I did the rational thing. I shredded those receipts – around $1,500 – because it wasn’t worth the pain.
I don’t feel much sympathy for a guy who has enough cash on hand to just toss out $1,500 worth of legitimate business expenses paid for out of pocket, but were I in that same situation with those kinds of bills for a single day, I would have moved heaven and earth to get that reimbursed. What did get me was why AOL has such draconian policies:

Then today I was talking to someone at AOL about nothing in particular, and he brought up his own troubles with expense reimbursement. I asked why the company is so crazed about it. 
Enter Gregory Horton. This guy was head of HR at AOL a decade ago when the company was still part of Time Warner. His story is amazing. He apparently set up a dummy consulting corporation and was billing AOL $100,000 a month for made up work. All in all, the company lost over a million dollars to Horton, or so the story goes.

This reminded me of one of my former employers who had policies as absurd, yet in a different way. I once had an expense report worth about $6,000 (three weeks in France) rejected causing the payment to American Express to be late, resulting in a late fee. Did it get rejected by the hundreds of dollars of wine purchased at multiple dinners? Nope. What about the multiple hotels I had to stay at because rooms were hard to find (and expensive) for those weeks? Nope. Surely it was the last minute purchase of an airline ticket! Nope.

A $2 parking fee was missing from the receipt packet. No, I am not kidding.

At some point, you have to just wonder about what rule someone broke 10 years ago that would cause so many process controls to be put in place that would reject an entire expense report because of a receipt that was completely immaterial to the larger goal of my project. So when the late fee came in, that I was responsible for, what did I do? Its called inflating costs on my future expense reports to cover the late fee caused by idiotic processes.

Was that underhanded of me? Most assuredly. Yet, if you look at how poorly the rules were instituted, they were giving me incentives to monkey with the system. If someone had bothered to think about how trivial that parking ticket was when compared to the total of the expense report, there would have been a ‘minimum % rule with a maximum value rule’ instituted that would weigh the time it took to fix the missing data and the potential late fees against the value of the receipt. Its an adaptive rule that recognizes people’s time and that some things simply are not worth arguing about.

Its situations like this that we, as project people, need to remember. We’re the ones who are looked to as trusted advisors by our business partners and its our job to make sure bad rules like this are caught before they are institutionalized. Work with me to fight for the rights of our users and fellow employees. Down with bad rules.