When you receive a request for a scope change, you
should consider the three basic components of the change management process:

  • The
    client defines the business value of the change.
  • The
    project manager (or project team) determines the impact to the project.
  • The
    project manager takes both the impact and the benefit to the sponsor for
    resolution.

The project manager and project team are accountable for
understanding the total impact to the project. Let’s take a look at the most important areas you should evaluate.

Factors that affect scope change

Effort.
The first place to look is whether there will be more effort required as a
result of the change. Almost all scope change requests result in more effort,
unless the change actually implies a reduction of features and functions.

Cost.
The scope change request may require additional labor and/or non-labor costs. In
many organizations, the internal employees do not have an hourly chargeback to the client so there is no additional cost (from
an accounting standpoint) unless the work is done by contract resources. There
may also be non-labor charges. For instance, you may have to buy additional
hardware as a result of a scope change.

Duration.
It is an over-generalization to say that all scope changes result in a longer
project. The question to ask is whether the additional effort for the scope
change is in the critical path. If it is, the project may indeed take longer.
If the change is off the critical path, it may take more effort but it may not
effect the overall project duration.

Focus
/ morale. Some scope changes result in more than additional effort, cost, and duration. They can result in the team losing focus or experiencing decreased morale. This is especially true if the
changes come late in the project or if there are many, many changes that result
in project drift.

Don’t overlook this final factor: Deferred benefits

Your project will result in a benefit to the company. The
benefit usually starts immediately after (or soon after) the solution
is implemented. If a scope change request results in the project being delayed,
the impact of the scope change should also include the cost of the delayed
benefit.

Look at the following example. Let’s say your project will
result in a business benefit of $5,000 per month in increased revenue. As the
project is progressing, the client makes a change request that will cost $5,000
and add one more month to the project. The change has an estimated payback value
of $500 per month.

You could go to the sponsor with a change request that
states that there is a $5,000 cost, a one month project delay, and an estimated
benefit of $500 per month. The sponsor might reason that the change will pay for
itself in 10 months.

However, the part that is missing is the deferred benefit
cost associated with implementing one month late. In this case, implementing
one month later than planned also costs the company $5,000 in lost revenue,
making the total cost of the scope change request $10,000, and requiring 20
months to receive a payback. The sponsor may still approve the change. However,
taking into account the deferred benefit associated with a project delay should
be a part of the scope change impact estimate for the sponsor to evaluate.