TOP Ideas

You can lose value by ‘adjusting’ the project’s scope to fit within the project’s timeframe or budget. As few projects can actually align their project activities to the planned benefits, any scope changes are usually done with little to no knowledge as to their value impacts.

Too frequently scope changes can unknowingly eliminate much and sometimes all of the project’s value.

Value loss from poor scope management comes in two forms – missed value and destroyed value.

Missed value comes as a result of the drive to ‘contain the risks’ and, therefore, define your project scope too narrowly too soon – missing nearby opportunities for even greater value. We have often increased a project’s scope by 10% and its resultant value by 200%. Initially your scope can be defined widely – we call this the ‘opportunity scope’ – where you seek to find where the real value is.

Think of prospecting land for gold. Rather than just define where you think the gold is and go for it, you do the (prospecting) work to determine exactly where the most gold (value) is. Then you focus your efforts on the high-value area through your ‘solution scope’ which defines the scope of your delivery project.

By adopting this two-step approach to scope definition you are more likely to identify where the most value is (and not miss it) and avoid working in areas where there is little value.

The second form of value loss is where the solution scope, once agreed, is compromised. This can be by scope increases without commensurate increases in value; or by scope cuts that lose or destroy the expected value. Few scope change approaches actually identify their benefit and value impacts. This is partly an omission of content but is also due to the fact that few project delivery approaches can align their project activities and scope to the value to be delivered. They cannot identify which business outcomes and benefits each element of the project enables, supports or delivers. This is a major failing of current project delivery approaches.

But there is one more dimension required here – effective governance. It is the primary role of the governance team to protect and deliver the project’s business value. All too often governance teams are not aware that this is their primary role let alone knowing how to do it. They therefore approve scope changes that directly reduce the project’s value and then wonder where the value went! I recently witnessed a Project Board agreeing to a change that would save $400k and eliminate the benefits completely.

If you want to optimise your project’s value, protect it and ensure its maximized delivery, you need to review your project scope management and governance processes. In most cases you’ll find that they are not value-focused.

Obviously, the Value Delivery Management™ scope management and governance processes are both wholly value focused.