Using the lines of code (LOC) metric in software project management can be a financial moral hazard to an organization. This is especially true for upper management who handles an organizational budget and strategic plan. Software project managers have their own budgets. However, if they fail to meet the budget, the organization's cash flow, rather than the project manager's personal cash flow, will suffer. This chapter will discuss the practice of software project management, the field of software metrics, game theory, and the game theory issue of moral hazard. It will demonstrate why using LOC as a metric can present a moral hazard to senior management and an organization.
