Game in the Brain

 https://pmstudycircle.com/contingency-reserve-vs-management-reserve/ 

I dont hear a lot about RESERVES. In pmbok we learn about Reserve, Allowance, and various types of reserves – from management to the work package and those reserves we use in Critical Chain Method to reduce the uncertainty and thus delays of a project or undertaking. 

REVENUE – COSTS =/= PROFIT

If you have a FUTURE then you cannot see any surplus time or resource or income as a PROFIT – any FUTURE means a RESERVE. 

Reserve is a KEY CONCEPT a lot of people don’t use – When you have a GOOD deal and make over your COSTS in a project, operation, or undertaking IF YOU PLAN TO OPERATE in the Future then anything OVER COSTS is a RESERVE. 

This is a different mindset where in people think in PROFIT – which is SOO SHORT SIGHTED.  Profit is seen mostly as “Disposable Funds” funds that I can spend – but that is only WITHOUT a context of the Future. Context of the FUTURE means I WANT TO OPERATE IN THE FUTURE. 

Reserve Margin =/= Profit Margin. In a company, team or enterprise it is OUR FUTURE OPERATING RESERVE. 

Profit can only be calculated if I know my target reserve. Target Reserve is only known if I know the Risks and the Future you will have to handle. 

Quality Management, TPS, LEAN, AGILE have a framework in RISK – a dirty word no likes talking about – the way most humans are so pain averse as to not have a healthy method of talking about risks and problems and thus defer and avoid it. Our fear of risk should not overwhelm as to cripple any dialogue to process it – but should be processed – because it signals problems that are EASIER TO FIX EARLY. Fear of Risks is a Great Deal! Its getting on the ground level of a huge discount in fixing a problem that will eventually cost so much more. 

Fear is processed by Actions that address it – either evaluated (if its valid or real or an opportunity), accepting, mitigating, transferring, avoiding, sharing, and processing risks.