Getting, Spending, and Scope Creep

I recently saw a review of a book by Ronald Wilcox (review here, book here, blog here) on why Americans don’t save.  The topic in and of itself is timely — the US has been a negative net saver for years — but the review’s summary of the book provided an interesting clue to drivers of scope creep and insatiable requirement demands. 

We all have “reference groups” — family, friends, coworkers — that influence our spending patterns.  An academic can get a clue as to the car he should be driving by looking at the university parking lot: business school professors drive new cars, English professors older issues of the same brands. Volvos good, giant SUVs bad.

I know, you’re saying, what on earth does this have to do w/ scope and requirements?   Well, how often do you benchmark other applications, processes, buildings, products, etc. for ideas?  These are your “reference groups”.  What happens next is the kicker.

Unfortunately, the clues you get from your reference group are “one-sided.” You notice the Porsche more than the Toyota, the old heart-of-pine floors in a colleague’s house: “And, over time, my beliefs about what constitutes an appropriate level of consumption for my reference group shift towards extraordinary items that generally are more extravagant and costly than what I currently own.”  This is more than the traditional keeping-up-with-the-Joneses; it is keep-ing up with the most expensive items owned by each of the Joneses you get to know…

And we wonder why people come back from trade shows like kids in a candy store…

Advertisements

One Response

  1. Interesting that this type of psychology, which I used to explain consumption, also explains some behavior in business product and processes innovation. Never thought of it — but sounds right.

    Ron Wilcox

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: