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Scope management in fixed price deliveries requires good management in supplier and client organisation

Management plays an important role in the fixed price delivery, regardless of the method or targeted information system. It is more or less obvious that the supplier is usually main responsible for the management, but it is sometimes forgotten that the client has an important role to play as well.

The client organization management should ensure that the rules of the game are really followed in their organization. This means that the fixed price contract and scope are really understood widely within the client's project team.  Rules of the game are different in case of a product-based solution, than they are in case of a tailor-made solution. On the other hand, the rules of the game are different when the selected method is agile than when waterfall method is followed. The first step is to understand the situation and the rules of the game.

For example, if client has purchased a product based package solution, the client should be committed on that solution. This means that the existing processes should adapt to fit to the product. Extending the product by adding new additional fancy features should be avoided. At least it should be analysed carefully before accepting any extensions. Whenever there is need to extend the scope, it should be done by understanding the financial and schedule impact of the specific change.

Keeping the originally agreed scope requires strict discipline and management. For business developer the pursuit of perfection is natural. The business developer wishes he could have the best features. While building a product based solution there is need for compromises, and sometimes there is need to accept even worse solutions than in the existing system. Compromises are typically not possible without strong management in client organization.

It is self-evident that also the supplier should continuously control the scope. Supplier's project manager's role is to ensure that the scope is controlled.  Sometimes it is hard. Supplier's developers and analysts are typically happy to implement all the customer's wishes. Developers are doing (for example, in the name of agility) continuous rework to create better solutions to meet the customers wishes. Sometimes the reasoning for rework is simply their own passion for the work.  The word ”no” doesn’t naturally belong to developer's or analyst’s vocabulary. It can sometimes be beneficial to carefully listen the customer's wishes, but tricky in terms of the scope control.

The scope changes should always be done be done in a controlled way regardless of the contract or development model. Parties, should understand and agree on the cost and schedule impact while agreeing the change.  Scope control should be strict in the supplier side, but there should also be understanding of the rules of the game in client organisation. If the control fails, there is risk to make an unreasonable amount of work that ruins project's cost and schedule control.

Strict management in supplier's and client's organization are required to ensure that only the real delivery targets are reached and the unnecessary work is avoided.

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