Penny Wise and Pound Foolish

You have probably heard the phrase "penny wise and pound foolish". The phrase generally is applied to someone who pinches pennies and then turns around and spend exorbitantly. More essentially it means that someone is fretting over small details while ignoring the bigger picture.

I witnessed a humorous (at least it was humorous to me) example of this during a meeting with a general contractor. He was presenting several painting contractors with a very large project involving a national fast food company. He was giving us some general information about the project, which was going to occur in cities across the South. At one point he mentioned that we would be using Sherwin Williams' products, so we would not have problems getting the same products.

One of the contractors started asking which specific products we would be using. He wanted to know if we'd be using SuperPaint or ProMar, whether the walls would be flat or satin, etc. Mind you, this project was still in the planning phases and no products had actually been specified yet. The issue was not the product, but how we would organize production and insure quality control. The product was an irrelevant detail.

I recently read a similar story on Denise Landers' blog.

One former user of Paper Tiger software told me he’d wanted to recreate that product’s great functionality by setting up an Excel spreadsheet and doing keyword searches to find his filed documents. I suggested he just buy the software instead, and maybe putting a completed time management worksheet in his first new file.

“Do you think you’ve saved money by trying to do that yourself, instead of just buying the software?” I asked. “Isn’t your time really worth more than that?”

In other words, this person was going to spend countless hours trying to re-create something that already exists. All to save a few dollars. Not only was he being penny wise and pound foolish, he was also trying to re-invent the wheel. Both are a huge waste of resources.

I see a lot of contractors do this on a regular basis. They plod along, year after year, doing the same things. They vow that next year will be better. They keep looking for some magic marketing pill. They keep trying to hook up with a general contractor or builder who will overwhelm them with work. And they keep refusing to do the simple, proven things that will actually help them build a better business. That's more than penny wise and pound foolish, that's just plain foolish.