I believe that we all overly dependent on our experiences. We become familiar with how certain scenarios unfold, and tend to expect similar results from analogous situations whenever we encounter them. Of course, each time these scenarios proceed as expected, it reinforces the notion that our formulaic expectations will be realized at the next iteration. I’ve written previously on how our experiences can become our worst enemy when it comes to selecting the optimal Project Management strategy for resolving a given problem, but what I’d like to address now is the phenomenon where we stick to pre-selected strategies even in the face of evidence that it’s a mistake to do so.
I think it’s fascinating how this effect influences management decisions and business analysis (ProjectManagement.com’s theme for November), because I’ve witnessed countless times managers making poor decisions in the light of evidence that their decisions are ill-advised. But probably the best dramatic example of this effect is beamed into households around the world here in Holiday Season, that example being George Baily’s behavior in the film It’s A Wonderful Life (1946). Briefly, George manages a small Savings and Loan (or Building and Loan) in the town of Bedford Falls, but his uncle Billy misplaces an $8,000 deposit to the local bank, which is run by the antagonist, Mr. Potter. As George contemplates suicide, his guardian angel appears and arranges for George to experience Bedford Falls as if George had never been born, in an attempt to get him to see how his life has had a positive influence on so many others’.
So what we have in this movie is George Baily experiencing an altered reality, but he spends almost the entire time rejecting his new circumstances, even in light of the following:
- By my count, Clarence Odbody, George’s guardian angel, tells George no fewer than twenty-seven times that the world around him has been changed to reflect what it would have been like had George never been born. Rather than accept Clarence’s information at face value, George constantly explains the things he is seeing and hearing as coming from different causal factors, including:
- Clarence is crazy,
- Clarence is playing some elaborate prank on George,
- George drank some “bad liquor,” or something,
- Everyone else is crazy,
- Or George has gone crazy.
- The clues that Clarence should have been taken at face value far earlier in the movie mount quickly. These include:
- George’s daughter Zuzu wanted George to fix her flower, which had shed some petals. George surreptitiously hides the petals in his pocket, and pretends to have fixed the flower. When George is transported to the George-less world, the petals have disappeared from his pocket.
- In what has to be a blow to those who do not accept anthropomorphic global warming, it doesn’t snow in Bedford Falls on Christmas Eve if George is never born.
- His acquaintances do not recognize him, and his home is obviously derelict.
- The landscape around Bedford Falls has changed, since the Building and Loan was not in existence to build homes for its families.
- These and other clues point to the, frankly, inescapable conclusion that Clarence is right, and George is experiencing the world as if he had never been born. Even so, George feels compelled to track down his wife, Mary, to see what’s become of her. Still not completely accepting the alternate-world explanation, he confronts Mary, telling her that he’s her husband. She faints.
Meanwhile, Back In The Project Management World…
The well-known study in Cost Performance Index stability[i], performed by Captain Scott Heise, with attribution to Major David Christensen, represented, in my opinion, a significant event in Project Management Information system efficacy. Probably the most significant inference that came from that research is that, since a project’s Cost Performance Index (CPI) is fairly stable relatively early in its life cycle, then the common Estimate at Completion (EAC) formula of dividing the Budget at Completion (BAC) by that very same CPI will yield an EAC that’s reliably accurate to within 10 points.
However, even in light of this well-done and clearly relevant study’s results, there are many George Baily PMs out there who refuse to accept its implications, that the easily-calculated EAC is reliably accurate. They’ll see that the calculated EAC is indicating a future overrun for their Control Accounts (or even the project as a whole), but will convince themselves that they can correct the negative variance prior to project’s end, even going so far as to generate the so-called “bottoms-up” EAC to indicate that there’s no real problem, or it’s not as big as the despised calculated EAC is showing. I’ve been told of executives who order their PMs to perform this very tactic when the calculated EAC is an embarrassment to them. Cost performance report after cost performance report, project after project, and these PMs won’t accept the evidence in front of their eyes.
Just as George Baily’s ordeal would have been much shorter had he simply accepted Clarence’s explanations earlier in the movie, and proceeded directly to understanding how dreadful the lives of his family, friends, and associates would have been without him, I believe that many managers in the PM world would be far more successful if they were to rely on the calculated EACs, and deal with the indicated overruns more quickly and directly than attempting to deny or minimize their implications (or accusing the calculated EAC aficionados of being crazy).
But then, had George accepted that Zuzu’s missing petals constituted ipso facto evidence of the validity of Clarence’s assertions, It’s A Wonderful Life would have been a much shorter movie.
[i]Heise, Scott, A Review of Cost Performance Index Stability, September 1991, retrieved from http://www.dtic.mil/dtic/tr/fulltext/u2/a246621.pdf on September 12, 2018, 14:17 MST.



