Ed Kless Is Wrong

Once again, the self-proclaimed Defender of the Timesheet and Champion of the Dissenters, Greg Kyte, is at it again. This time he takes me on rather than Ron Baker of VeraSage.

Dear Ron,

Quite awhile ago, I sent the following letter to the Journal of Accountancy, but apparently they were too scared to print the truth. Enjoy as I expose the falsehood of your co-conspirator, Ed Kless.

In April 2010 the Journal of Accountancy published the article, Project Management for Accountants by Ed Kless. Although the article contained a significant number of words, many of those words created lines, and if one reads between those fabricated lines, one may find the same offensive subtext that I found. The author is waging a guerilla war – not against gorillas, but against the accounting profession. Project management is for ignoble professions such as contractors, engineers, and doctorate-level pharmacology researchers. Project management may be good enough for those and other financial Cro-Magnons. We accountants, however, are the progeny of a dignified tradition, and our collective pecuniary prowess has led us as a community to a near-universal acceptance and usage of the financially sophisticated and elegantly simple concepts of the billable hour and the timesheet.

Mr. Kless’ approach to project management is his attempt to rob our profession of the fringe benefits that accompany the billable hour and the timesheet. In his article, Fast Eddie lists eleven essential components of a scope statement. He advocates the use of a scope statement because it is designed to limit “scope creep”; however, he ignores that fact that under the billable hour paradigm, scope creep creates revenue. Ergo, Fast Eddie is trying to decrease your firm’s revenue, and if you consult your accountant, she’ll verify that revenue is a good thing.

In his opinion, all assumptions between a firm and a client are to be clearly enumerated. Mr. Kless exhorts us to “answer the question, ‘What should we not leave unsaid?’” But since I bill by the hour, there is only one assumption that I can’t leave unsaid—the assumption that if I work on an engagement for an hour, the client is going to pay me for an hour.

I actually liked his idea of maintaining a “future project list.” It’s a list of possible projects and major tasks that will be deferred until the future … like when I need more billable hours.

He argues that constraints need to be brainstormed and specified. Constraints are limitations and restrictions that could hinder the efficiency of an engagement. The article states that constraints are “risks in waiting.” Don’t look at constraints as risks in waiting; look at them as semi-avoidable wellsprings of cash flow.

Possibly the most offensive part of this article was the following assertion made while discussing how to calculate percentage of completion: “Measuring the completeness of your projects by hours billed is akin to listening for the smoke detector to determine when your cookies are done. The alarm only goes off when it’s too late.” This is blatantly invalid. The beauty of using billable hours is that we don’t need to measure completeness. Billable hours and timesheets are actually like cooking with the Ronco Rotisserie and BBQ Oven: “Just set it and forget it!”

Once again, Greg demonstrates that he is quite deserving of his self-developed moniker.

4 thoughts on “Ed Kless Is Wrong

  1. Ed – I think you’re taking it wrong: Google tells me this guy is a stand-up comedian. Taken in that perspective, it makes complete sense. I mean, really, there is NO way a professional could call constraints, “semi-avoidable wellsprings of cash flow”, or say, “we don’t need to measure completeness” with a straight face. I mean, if he really believed that, and his clients read it on the Internet, the joke would be on him!

    Maybe we need a “Kyte’s Law”, analogous to Poe’s Law… something like: “Without a wink or a smiley, a parody of a rabid accountant living in fear of the measurement of the value of his services is indistinguishable from the real thing.”

    P.S. “Spring Ahead Waffle Parties” as a benefit of hourly billing? This guys written humor is far better than his stand-up!

  2. Greg’s entire article seems to be written ironically and actually advocating FOR the principles espoused by Ron and Ed. It’s hard to read it as serious.

    If I read it as a serious statement (putting aside his dismissive nicknames and cutesy phrasing), it seems as if he is advocating overtly dishonest and deceptive practices?!

    I’m not going to pick apart his essay piece by piece although it is begging for that treatment. Here’s a few points that I would make based on personal experience:

    1. Greg can bill for all the hours that he wants but if a client doesn’t agree that the work was done correctly or as expected, the client may choose to not PAY for the hours. Billing Revenue where it counts, ie your bank account. Cash In = Revenue and I don’t need to consult my accountant to know that!

    2. I’ve attended many sessions presented by Ed and never once have I heard that we don’t do additional work beyond the project scope. The goal is to treat out of scope work as maturely and rationally as the initial project. We present what is being done, how it will be done, the impact on the timeframe and the impact on the budget.

    We provide options on doing the project and subsequent change requests and the client can decide if they want to proceed or not. To sneak hours in on a time and materials basis in order to accomodate a poorly specified project is fraught with potential headaches for all parties (see point 1 above).

    3. I strongly disagree that timesheets have some sort of benefit of allowing consulting firms to coast along on a project. If things go off the rails, the timesheet will be used to pick apart who did what wrong and how long it took instead of focusing on the underlying team mechanics to resolve the problem for future engagements. With fixed bid projects, we all own the deliverables and the timeframe and our focus is on those key objectives – not on whether Joe and Jane Biller have entered their time for the day or week.

    Apparently Greg has the type of clients that he can just bill whatever he wants and they just sit and take it. I am jealous in part.

    My clients want projects that convey a well-understood set of deliverables and inherent value within a set timeframe. I have yet to find a client that just says “start the clock and go to town! Please bill me as much as you want”.

    Frankly, I prefer the open, honest dialogue with my clients where expectations are set for both sides BEFORE the engagement and then it’s up to my firm as the professionals to accomplish those objectives the best way possible. If we choose to train a junior resource, our profit will be greatly hit – but it’s our choice. If we can re-use something we have done for others in the past, our profit will be increased – again it’s our choice.

    The client wants the end results. As professionals, why do we continue to force them to deal with the internals of our businesses?

  3. Where does Kyte get clients who give him blank checks? The equation ‘Kyte Billable Hour x Rate = Value’ isn’t in my clients’ business manuals!

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