Scope creep is something that project managers in architectural firms have to be alert to whenever they are managing an architectural project. It refers to the ongoing growth or change in the scope of a particular project, often significantly beyond the original agreement.
Adding unbudgeted time and costs to projects can become a serious problem, as the original margins become eroded. If scope creep is allowed to go unaddressed, it can ultimately jeopardise the profitability and viability of the entire business.
How scope creep can impact architectural projects
While most projects are profitable during the early design stage, this profitability can disappear during the construction stage. This is generally due to on-site scope creep and the lack of control mechanisms to track and manage additional costs.
Scope creep can happen for various reasons, often with many variables coming together to create problems. Some of the principal reasons that scope creep can occur include:
Scope change or variations
One of the main reasons for scope creep is the client moving the goal posts or requesting significant changes to the brief after it has been agreed. Unfortunately, this happens regularly, meaning that architects need to be clear from the outset about the detailed project scope: identifying what is and (as importantly) is not included in the brief.
Any changes that have been made mid-design will effect the effort and cost the architect will need to expend to implement the changes. It can often require the architectural practice to adjust and re-issue their plans and specification documents to accommodate the client requests. These extra costs should rightfully be recouped from the client.
Communication problems at the outset can create issues as the project scope becomes ambiguous or poorly defined. It’s entirely possible for the client and the architect to continue for some time with very different ideas about what the project really entails.
When this isn’t addressed from the outset, it can lead to a breakdown in the working relationship with the client. However, more often than not, it leads to the architect making changes to the initial plans to try and find a way to meet the client’s expectations- expending additional effort that was not initially budgeted for. When this happens, costs will creep up and ultimately undermine the profitability of the entire job.
Additional design revisions
One of the most pernicious ways scope creep can occur is through additional design revisions. If an architect agrees to undertake a small revision after the design has been agreed upon, it’s more likely that further small revisions will be requested. These changes may be small in themselves and may even seem relatively inconsequential, but they can, over time, result in significant scope creep.
Handling the expectations around the agreed number of revision requests clearly from the outset is key to ensuring that a project stays on target.
Keeping track of the schedule
Managing project schedules can be a complex process with a range of variables that can result in unexpected costs. For example, as you try to meet particular deadlines in the project, clients may request changes, or circumstances such as site or supply-chain issues may compel unplanned-for delays. While this may not result in direct labour costs (like it would with, eg a drawing revision), there will likely be additional costs for simply having to attend site (eg weekly meetings) for a longer than expected period. Again, it pays to spell out your initial assumptions in terms of project durations and visits when agreeing the project scope.
What problems can scope creep cause?
Scope creep creates a range of problems for both the client and the architect and can, in worst-case scenarios, result in a complete breakdown in their relationship. Therefore, managing scope creep is critical to delivering projects on time and within budget and to sustaining a healthy professional reputation.
Some of the key pressure points that can be impacted by scope creep are:
As the scope of the project changes and grows, it becomes much more challenging to meet deadlines. This can create further problems with suppliers, contractors and the client. Missed deadlines add costs which further eat into the overall profitability of the project.
As project deadlines are missed, it can have a knock-on effect on other jobs that may be in the pipeline. Failing to meet deadlines and deliver projects on time can ultimately have a severe reputational impact on professionals.
When scope creep happens, it’s very rare for it not to have an impact on the overall cost of the project. In some cases, the costs can be quite significant. This then presents challenges in how these costs will be recovered (if at all). If the architect hasn’t been clear with the client from the outset about the consequences of any changes, then it can lead to disagreements and strains within the professional relationship.
In a worst-case scenario, scope creep can have such a detrimental effect on the relationship between the architect and the client that litigation follows. As well as disagreements about costs, clients may pursue litigation as a result of undue delays.
Standard 6.2 of the ARB Code of Practice requires that work is carried out without undue delay as far as is reasonable. Although delays can happen, the ARB expects there to be clear communication with clients to keep them fully informed of progress.
How to effectively manage scope creep
Managing scope creep requires an awareness of the risks and some of the potential problems that might arise. Delays and problems with delivery give more room for scope creep, with client concerns often prompting revision to plans.
Be clear on the initial Project Scope
The signed agreement between the client and the architect should clearly define the scope of services. This should include:
- A per stage breakdown of services
- An itemised list of services and deliverables that the architect will deliver
- An itemised list of exclusions that will not form part of the project scope
- An agreed hourly or daily rate that will be charged for any additional work outside of the above agreed services
- A clear process of how additional work is to be instructed by the client, and accepted by the architect
Manage start/end times
Unrealistic start and end times for projects are one of the most common causes of scope creep in architectural projects.
Currently, a range of extra complications is impacting the delivery of architectural services. Delays in the planning system are leading to significant logjams in the completion of projects. A survey by RIBA found that two-thirds of respondents said projects had been delayed by one to six months, while almost a third reported that projects had been delayed by more than six months.
Seven per cent reported that these delays had resulted in projects having to be abandoned. A further 39 per cent said delays had put back schemes by up to a month.
As well as problems with the slow pace of the planning system, there are also shortages of materials and labour. These shortages have a significant impact on the construction sector, adding a range of unpredictable variables when it comes to project completion. All of these factors need to be taken into account when establishing a realistic project programme.
Variations to the initial project scope must be costed
Any variations to the initial project scope need to be costed, and this should be communicated to the client from the outset. Clarity about costing can limit the potential of scope creep as clients are keen to stay within their budget.
Costings should be clear and upfront, and the cost of any variations to the initial plan should be made clear to the client before any agreement is reached to implement them.
Communication issues tend to underlie most scope creep scenarios. Lack of clarity about what changes to the project might mean can all lead to unrealistic expectations from the client or reactive proposals being made due to delays and other problems.
To avoid scope creep, you need to:
- Be clear on the project goals from the very start.
- Take the documentation of requirements seriously and use architect project management software to keep on track.
- Implement change control processes so that any reasonable changes can be reviewed and approved.
- Create a clear schedule and stick to it.
- Be brave enough to say no to a client if unreasonable changes are requested.
An overarching view of your project
Fresh Projects gives you the financial management tools you need to maximise the profitability of your projects. This includes:
- Intelligent CRM for Architects
- Architect Fee Calculators
- Timesheet Software and Time Tracking App
- Resource Planning Tools
We provide a seamless solution to improve your project accounting and profitability – including the ability to easily track (and invoice) any out of scope costs.
To find out more about how Fresh Projects can help you manage scope creep and other project challenges, book a 30-minute demo today.