5 Tips to Avoid Scope Creep & Increase Project Profitability
by Jarno Koopman on July 18, 2023
One of the biggest threats to project profitability is scope creep.
Though sometimes inevitable for longer-term, more complex projects and services like software development, scope creep is largely negative. Scope creep can lead to delayed timelines, increased costs, and even unhappy clients who may never return.
Not to mention, scope creep can negatively impact the morale of your team by muddying the overall vision of the project and pushing the deadline back ahead again and again.
Here we discuss scope creep, including what it is, its main causes, and 5 easy tips to avoid it on your next project.
What is scope creep?
Scope creep refers to the unmanaged, unforeseen increase in the scope of a project or service agreement. This can include an increase in deliverables demanded by the client that exceeds what’s included in your project plan, as well as any other unauthorized work.
Your project scope includes what you will deliver to the client and any relevant requirements for the work. The project scope should be clearly spelled out during the project planning stage and agreed upon by both parties.
When clients and stakeholders make requests outside of what’s clearly outlined in the project scope, and it’s not managed in some way, you get scope creep.
In many scenarios, service businesses expect clients to request more work throughout the lifecycle of the project. Accordingly, they can account for this in their project planning and can make sure they’re compensated with a billable hours model.
Scope creep is not the same thing. Scope creep happens when a client’s additional requests are not effectively managed with any system or process. These changes are made without any controls in place. That means that effectively, the business will eat these extra costs in the interest of pleasing customers. The result is a lower project profit margin and often, the continuous extension of deadlines and deliverables.
The term itself speaks to the nature of what is happening with scope creep. It’s usually not about a major, costly change initiated by the client, as something like this would usually be covered contractually.
Instead, scope creep usually entails small increases that add up over time. An extra feature. An extension of service. Little additions to what the customer is demanding eventually creep up on you, hence the term.
What causes scope creep?
Anything that makes your clients demand work outside the agreed-upon project planning may result in scope creep. Here are the most common causes of scope creep in project management:
Murky objectives and requirements
Perhaps the initial project scope you gave the client was a bit vague, or worse, there was no official project scope completed whatsoever. Without crystal-clear documentation on this, clients and even your team may not effectively understand what the scope actually is. Inevitably, you’ll incur additional costs, and team morale may suffer substantially.
Murky objectives and requirements may leave the definition of deliverables up in the air. A clear project scope will outline exactly what the deliverables are, so everyone knows what’s expected.
The project scope needs to be clearly documented and shared with all stakeholders during the planning stage. Failing to communicate the project’s requirements clearly can result in both sides not knowing what’s expected. Early communication surrounding scope gives sufficient time for stakeholders to give their feedback. If communication is absent at the beginning, clients often will feel they can ask for more and more. This can quickly spiral, negatively affecting both the client experience and team motivation.
Too many opinions
When there are many stakeholders on a project with strong opinions and intimate involvement, scope creep can slowly chip away at your bottom line. In these cases, it’s critical that the project manager delegate leads and/or solid processes for each team. This can help keep everyone moving forward. While projects with many stakeholders may be unavoidable, no matter what, it’s about mitigating input according to project scope and respectfully filtering out the rest. Otherwise, your workflows can get clogged and thus, scope creep rears its ugly head.
Agile project management
Agile project management for certain service businesses like IT is a great methodology to maintain flow and effectively pivot when needed. However, the nature of agile project methodology can sometimes make it easier for scope creep to enter the picture, since many elements are already expected to be in flux.
This doesn’t mean businesses should necessarily abandon the agile method if that’s what’s working. But rather, certain processes and controls should be put in place to keep work on track and anticipate scope creep before it happens.
Can you avoid scope creep completely?
In a nutshell, no, so make peace with it. That’s because a bit of scope creep is sometimes necessary to please the client, and a couple of small changes shouldn’t negatively affect the bottom line.
For example, if you end up adding an extra feature or service, and this only adds an additional 5 hours of work for your team, it’s worth it to delight the customer. And if your profit project margins are on-point, a small deviation like this shouldn’t matter.
A negative example of scope creep would be increasing the work on the project by 15% to add new features. This is more of a significant increase in the costs required to complete the deliverables.
5 Tips to Avoid Scope Creep in Your Projects
1. Document in project scope and requirements in DETAIL
Get super detailed with your project scope and requirements in the project planning stage. Make note of everything your stakeholders want from the project, no matter how intricate and tedious this may seem. Then, compile all this information into a document that clearly lists all the requirements. Share with stakeholders during the project planning stage. Be sure to include how the project requirements will be tracked along with a clear-cut process to change them. It’s also highly recommended at this stage to provide a clear project schedule like a Gantt chart that will display a clear timeline to both your client and your team.2. Clearly communicate the project scope
When you’re initially documenting the project scope, communicate with project stakeholders to find out exactly what they want out of the deal. Make sure if the client(s) is being too broad to tease out tangible requirements that can then become milestones and part of the scope. Also, if stakeholders cannot agree on an item within the scope, act as a referee to settle the issue before project execution begins. Whatever communication is required to make sure clients clearly understand the project scope, do that and then some. To prevent scope creep, it’s better to overdo it with communication, so don’t be afraid to pester a little bit.
3. Put a change control process in place
Small changes in scope are not detrimental, provided you can manage them effectively. To do that, you’ll need to put a change control process in place. A change control process will explain exactly what needs to happen if someone wants to change something in the project plan along the way. This usually looks like setting up some sort of change request, after which a designated person will review it, and then, for example, the project manager approves or disapproves the change. However your change control process looks, create a document that explains everything clearly and share it with every stakeholder.
4. Use agile project management practices
Earlier, we mentioned that agile project management can actually be one of the causes of scope creep. Turns out, it’s also one of the solutions to keep it in check. This is especially true in software development, where at the outset, all the project requirements are not yet known. In these cases, the scope has no choice but to evolve, and agile project management is the perfect method to address that. With agile project management, deadlines are solid while intermediary dependencies are subject to change. Thus, if and when scope creep looks like it’s on the horizon, you’ll be able to respond effectively before it’s too late.
5. Benefits management
The final tool at your disposal to mitigate scope creep is what’s called benefits management. Also known as benefits realization, benefits management is a process that involves identifying, planning, measuring, and tracking project benefits. Whereas project requirements are specific and task-oriented, benefits are broader and related to customer satisfaction. For example, a project requirement might be to increase the speed of a website. A project benefit would be to improve UX. With benefits management, you can stay focused on the real purpose of the project and effectively evaluate whether change requests are indeed necessary.
A final word on scope creep
Scope creep is largely unavoidable to some degree, but it doesn’t have to negatively affect the profitability of your projects. The key is to anticipate scope creep, clearly documenting and communicating project requirements from the beginning. If you put a change control process in place, communicate incessantly, and focus on benefits management, you’ll be able to successfully keep scope creep in a smaller range where the customer is satisfied and your project profit margin is where it should be.