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Defining Scope

April 3, 2013

Research consistently points to the challenge of accurately defining the scope of work. It is the  number one cause of claims and disputes.

In this context, I came across an interesting article outlining a case study from the construction industry. As an industry, construction has made great efforts to tackle the sources of claim and dispute, or to simplify their resolution. An example highlighted in the case study is the definition of differing site conditions – for example Type I, Type II. These definitions allow for far greater efficiency in both negotiating and managing the contract.

The article emphasizes the importance of the contract and its wording when embarking on projects where there is a significant degree of uncertainty.

In this particular case, the discipline developed by the industry did not prevent a dispute. However, it made me think about the value that industry-wide definition could bring to other sectors, such as IT, software development or outsourcing contracts. In construction, terms such as Type I or Type II are used to depict levels of uncertainty in the underlying site conditions – for example, related to sub-soils or possible obstacles.  In a sense, contractors for projects in IT or outsourcing face very similar ‘site uncertainties’. They have to rely upon the representations of the buyer with regard to management support or user attitudes. They often face unknown elements regarding interfaces or related strategies.

Today, those uncertainties frequently lead to delays, unexpected changes, added costs. But because they were not identified as uncertainties, they typically become an issue of dispute. Like construction, might we not list the areas or ‘site conditions’ that are typically encountered and rank the extent of uncertainty and impact – thereby creating Type I, Type II, Type III models to reflect the areas and extent of potential variation to the original scope – and thereby more accurately set the expectations of both parties?

One Comment
  1. Peter permalink

    I totally agree, a solid contract Defined Scope is a must, backed up with a solid Project management framework (methodological) with penalties.If you are transitioning suppliers as part of your contract is to make shore that there is a transition plan/project plan with penalties in both entry and exit contracts.

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