Why Service Firms Have to Manage Scope

If you sell widgets, it’s easy to know if you got what you paid for. If you pay Amazon for a bottle of laundry detergent, then you will know the price, and you will know when you get the bottle of detergent.

But service-based companies are different. Managing scope becomes a practice we have to become very good at so as to provide the best care for our clients. Services are often unseen, they are nuanced, and their delivery can even go unnoticed. So solid service-based companies have to manage scope. What is scope? It is simply and clearly stating what services you will provide for the price you are asking to be paid. Scope is managed in at least two ways:

  1. With a one-time Contract. All service-based companies need to have written documentation describing their services in detail, along with the price that is expected and how that price will be paid.
  2. With ongoing Client Management. Establishing a contract in writing is just one way to manage scope. It is also an ongoing communication and work that is done throughout the relationship with the client.

Service-based companies are providing intimate services to other people. So managing the ever-changing relationships between those people takes time and conversations. We’ve taught our client-facing team members to be careful of over-work from our firm, and over-requests from our clients. Those are two ways scope can get out of hand. And when scope gets out of hand, the firm or the client can begin to be hurt by providing services without being paid, or giving the client more than they were initially promised in the contract.

Scope is a multi-faceted management animal. It’s always moving, always changing, and always learning. That is, many have to keep an eye on scope as it can get out ahead of us if not watched closely. We let our team be the front line on noticing scope. Then they bring potential out-of-scope issues to the owners so we can clarify and begin new conversations with the client (if necessary).

If you need help leading and running your agency better, let us know how we can coach you to growth. You can reach out at [email protected], or apply to become a client: https://www.blumercpas.com/client

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