How to blow £250k by not trusting your instinct

I've been examining cost models a lot recently - the swathe of statistics, pivot tables and macros that help me decide if I should spend X on Y for Z reason. In most cases, I'll defer to a spreadsheet when I'm making major financial commitments. (Both professionally and personally - I know, I need to get out more). But one thing I tend to rely on most is instinct and experience. Because time and time again that's proven to deliver.

Take a major project I worked on in a previous role. We were building a major piece of software. I'd created the vision, the roadmap and - crucially - the budget. When I presented it to the rest of the board (who were all quite nervous given how much of a departure this type of project was from the firm's 'norm'), the first, and loudest, question was "how do you know it'll cost £ and take n weeks to deliver?"

My answer was simple: "because that's how much it will cost and that's how much time we have."

I was immediately asked to get comparable quotes.

So I did. And this is where the lesson, for me, reads greatest.

I had stipulated a budget of £380k and a timescale of 35 weeks. Why? Because that's what felt right. There's no simpler answer. My Excel wizardry confirmed I was about right, subject to the decisions I'd made. But I had three other entities quote the exact same brief. And what they came back with was:

1. One company suggested we'd need to allocate £550k and the process would take up to 50 weeks. 2. The second told us the same, basically. We would spend £600k and we'd be done in a year. 3. The third told us the 35 weeks was fine, if we'd allocate a £750k budget.

The average is £633k and 46 weeks. That's £253k and 11 weeks longer than I had predicted and, instinctively, gauged (guessed).

At this stage, most corporate structures would've encouraged (forced) me to revise (increase) my budget.

But I didn't.

And I delivered the project at +1.1% against my initial budget and -1.8% against my initial timeline.

Why?

Because that's what we had. And that's what we wanted to do. Similar to Google's revered 'moonshot' thinking, we could've played safe, we could've given ourselves a cushion. But we'd have then played safe. And we'd have spent the cushion. Instead, we had two aggressive targets - which pushed us to create aggressively innovative solutions to the challenges we faced on the way.