Electronic Design

Engineers Vs. Bean Counters: The Struggle Continues

Here's an observation I've made about the corporate engineering environment: Accountants make noise in our signals and we make noise in theirs. Check out how:

1. Everyone who travels comes back and spends half a morning filling out an expense report. Pockets are searched for receipts. Every item must be entered in classified columns marked Hotel, Meals, etc. Those columns are cross-ruled into rows by date. The employee must then add the columns and rows and cross-add the sums. Meanwhile, the professional work for which this person is paid is being neglected.

I see why accountants must like this rigmarole. I believe that they believe if the sums match, the traveler didn't cheat. Plus, the document looks like the spreadsheets they make and thus must be good.

One of my best inventions is the expense report I used in my companies. It's a plain letter envelope. Whenever the traveler made a payment of any kind, he or she recorded it on the face of the envelope and stuffed the receipt inside. Upon return, the envelope got tossed, untotaled, to the bookkeeper. After all, the bookkeeper could add and classify better, faster, and a lot cheaper.

2. When I was at Convair/San Diego, a wooden box stood outside each of the large drafting rooms. If one rolled up a drawing, attached a blueprint order, and left it in the box, the blueprint fairy would make prints. One retrieved those prints from the box a little later.

Then, a clever accountant realized that the fairies were an overhead expense and got them fired. Now the engineer walked drawings to the reproduction building, waited in line, and carried the prints back. But his or her salary was direct labor, so overhead was saved.

3. Engineers there also telephoned vendors, customers, and other sources. Most calls were long distance, and all were charged to overhead. Another clever accountant created the rule: "Give the number called and your direct charge number to the operator, who will place the call and call you back." Since one didn't want to hire too many operators (on overhead), the actual time between placing a call and getting it through averaged 20 minutes.

During that time, the engineers went on hold. They dared not leave their desks. They couldn't continue with the task that lead them to place the call. They could try to switch to a different task or do without the call. Thus, they do a poorer job costing more money but on direct expense, chargeable to the government contract.

Convair/San Diego no longer exists. In my companies, I instructed everyone to charge $1.00 to overhead if they could save $2.00 in direct labor by doing so.

4. I was the first engineer hired by Teleregister in a division established to contract for data systems. The accounting department recorded costs and computed an overhead rate to include in new quotations. In the first years, with small sales, the rate was high. When we tried to quote on large systems, they insisted on the historical rate rather than a projected rate, which lost us our quotes. The new division was closed down, killed by accounting.

Of course, accountants do have real uses. They read time sheets and purchase orders and tell managers how much a project has cost, so far. Managers really should know. It has been known to happen that an engineer charged some hours actually spent on an over-running project onto a different project "which could stand it" Really, this is adding engineering noise to the accounting signal.

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