Avoiding Scope Creep - the Bane of Service Providers’ Profitability

Avoiding Scope Creep - the Bane of Service Providers’ Profitability

Entrepreneurs with service-based businesses have one major commodity to offer: their time. As a finite resource, it’s crucial to factor the time it takes you to complete the work into the equation when pricing your projects so you are fairly compensated. Pricing can be tricky because even a carefully-considered estimate can easily become derailed by unexpected scenarios and client requests that eat up more time than you charged for. Such "scope creep" is an all-too-common problem that plagues service-based entrepreneurs, causing them to spend time they’ve not been paid for, in the service of client satisfaction.

How does scope creep begin?

Scope creep is insidious: one more little tweak, one extra round of edits - the kind of request clients don’t think twice about - and suddenly hours of unpaid labor have piled up. You said yes to each one because you wanted to be agreeable and thorough before signing off on the project.

The usual causes of scope creep include:

• Vague (or undocumented) project parameters
• Client’s lack of understanding of exactly what is agreed upon
• Gradual, incremental requests that individually seem negligible
• Lack of a clear process for making additional requests

Often by the time the entrepreneur recognizes that scope creep has occurred, it’s too late to address it. This can lead to a sense of resentment for "being taken advantage of," even though the client isn’t aware of the impact of their requests.

Creep-proof your working arrangements

The best way to avoid scope creep is to compile an agreement, established before work begins, that spells out the scope of service meticulously and includes these elements:

• A clear, detailed list of deliverables agreed upon by both parties
• Specific mention of what falls outside the scope of the project, like revisions beyond the agreed-upon number, meetings or expedited deadlines
• Specific mention of actual numbers and details of what is included, like the number of included revisions, check-ins or meetings
• Expected timeline and project milestones
• Explicit descriptions of consequences for the client for exceeding project parameters or causing delays, as well as the process for expanding the scope of the project and how that would be priced.

An agreement that includes this information will ensure everyone is on the same page throughout the project; they’ll know what is and is not included and will be aware of how to proceed when changes are desired without it being awkward or confusing.

Think of this agreement as establishing a boundary that says, "I will not allow you to take advantage of me." Then, when scope comes into question, the response isn’t, "No, I won’t - or can’t - do that," which may come off as resistant or unaccommodating. Rather, it’s a simple, professional statement: "That request is beyond the scope of what we originally agreed to" - followed by an offer to make the change according to the process outlined in the agreement. This demonstrates that you recognize the value of your own work (and associated time) and in turn will signal to the client that you are worthy of their respect and trust.

Still, it can be difficult to adopt the necessary stance when responding to a client request for additional work for fear they may think you’re trying to bilk them out of more money unnecessarily. Some useful phrases that acknowledge requests name the boundary factually and offer a choice - rather than a refusal - which will help you express things with the right tone and promote a positive mindset around scope adjustments:

• "That’s a great addition - let’s talk about how it fits into the project as an add-on."
• "I want to make sure this gets the attention it deserves, which means treating it as additional scope rather than squeezing it into what we’ve already planned."
• "Just so we’re aligned - here’s what’s in our original agreement, and here’s what this new request would involve."
• "I can absolutely prioritize this, but it will mean adjusting either the timeline or the budget - which would you prefer?"

Project tracking is your friend

An effective way to keep control of a project’s scope is to track it diligently. Keep a running log where both you and the client can see how the project is unfolding, how and when deliverables have been met and when additional requests have been approved along with their associated costs or timeline impacts. Not only does this protect you should a dispute arise, but it also serves as a record for the client of how their choices have shaped the project, which tends to make them more thoughtful in their future requests for scope adjustments.

Lest you think every single minor client request needs to be reflected in the formal agreement, it does not. Your discretion and flexibility are key. A few minutes spent "off the books" occasionally to help a valued client is well worth the goodwill it buys you. Just be wary of frequent or repeated requests for favors; that pattern should be noted and formalized before it snowballs into an issue.

You want to be easy to work with, agreeable and helpful. You also want to be fairly compensated for your precious commodity: time. A balance can be struck with a practice of implementing and enforcing a scope of service agreement. Your client will be the beneficiary of a professional willing to accommodate their needs while you are rewarded for your efforts without feeling put upon or disrespected when called to provide additional service.

How do you currently handle scope creep in your business - and what’s one boundary you wish you’d set earlier?