accounts scare

Avoiding the dreaded ‘scope creep’

When you’re a service business, it’s not unusual to go above and beyond for a client, but those little extras can really add up! Ailsa Page from MYOB has some advice to help you keep it under control. ~WizeOwl

If there’s one thing that can fill a consultant with dread, it’s the constant tiny little requests to add onto an original scope of work – here’s how to stop it.

Scope creep has a way of, well, creeping up on you and turning what started out as a profitable job into a non-profitable one in a heartbeat.

It might start with a simple, easy request by the client of ‘can you also just do this?’ In isolation the request is easy to fulfil as part of the job. In isolation, it won’t take you much time and energy – and like most businesses consultants will think little about going above and beyond to delight the customer.

The challenge is when a lot of ‘little extras’ mount up and you are doing more work but left charging the originally quoted price.

The greatest danger of scope creep is that you risk your profitability and may end up highly resentful towards the client. Two things to be avoided at all times!

In an ideal world you would try and avoid scope creep altogether, but job quoting isn’t always a black-and-white practice and things can change – from the client and from you.

What you can do is put you self in the best position to:

  • Decrease the likelihood of scope creep occurring
  • Identify when scope creep is happening and
  • Take immediate steps to halt it in its path!

Four ways to protect against scope creep

1. Fully scope out the job

This is about taking the time up-front to fully scope out the job.

Play Devil’s Advocate and think about the things that may pop up which are beyond the scope of the contract, and also think about what may go wrong.

Often, we get excited about a new job and put our rose coloured glasses on and assume everything we go swimmingly.

Think about what could go wrong, ask the difficult questions to the client to make sure you’re clear about their expectations and the result they’re looking for.

2. Document

As soon as any request outside the scope has been made, large or small, document it and get the client to sign off on the changes.

You can decide later whether these changes fall into the original price as a substitution, or whether they’re an extra.

3. Spell out how you’ll handle amendments

Instead of telling the client on the fly how you’ll deal with amendments to the original job, spell it out in the contract of work.

This sets expectations right at the start, and will avoid the client being shocked by your reasonable request to charge more for more work.

They may forget over the course of the job what they agreed to, but if it’s in the scope of work at the start of the job you can simply show the client what they signed.

4. Discuss

At the first sign that there are changes or additions to the original scope, set up a meeting to discuss these changes with the client and work out a mutually agreed way forward.

This might mean re-scoping a particular stage of work.

It’s important to have the conversation early rather than later. Being proactive in this situation will also benefit you.

A new approach to quoting

If a job is a tricky one to quote, for example you don’t know certain conditions until you start, or you haven’t worked with the client before, you may like to break your quote into smaller stages rather than quoting as one big job.

This gives you the option to quote each stage when you have more knowledge up your sleeve to be more realistic of the work involved and your pricing for it.

It also can work for the customer as they can take a smaller risk as they get to know how you work.

Offering an indication or estimation of cost highlighting the variables that may impact on price can also assist in managing customer expectations and negotiating changes to an original scope.

Scope creep can happen with any client, on any job at any time.

The most important thing you need to do as a business owner is to recognise the signs, take action and then set up processes to make it easier for you in your business.

Did you know your accounting software may be able to help you with quoting? Contact us today to find out how.