Change of scope: Overview, definition, and example
What is a change of scope?
A change of scope refers to an alteration or modification to the original scope of work outlined in a contract or agreement. It typically involves a change in the specific tasks, deliverables, timeline, or other key aspects of the project or service that was initially agreed upon. Changes to the scope may occur due to unforeseen circumstances, client requests, or new requirements that arise after the contract is signed.
A change of scope can result in an increase or decrease in the project's scope, which may impact the budget, timelines, and resources required. In many cases, a formal process is required to document and approve changes to the scope, which may involve renegotiating the terms or issuing a change order to modify the contract.
Why is a change of scope important?
A change of scope is important because it helps ensure that the expectations of all parties involved in a contract or project are clearly defined and managed. When the scope changes, it can have significant implications for the project's outcome, including the timeline, cost, and resource allocation. Addressing these changes proactively helps maintain transparency, avoid disputes, and ensure that the work delivered aligns with the revised requirements.
For businesses, clearly defining the change of scope process and addressing any changes as they arise can prevent misunderstandings, budget overruns, and delays. For clients, it ensures that their evolving needs are met, while also maintaining control over the impact of changes on the overall project.
Understanding change of scope through an example
Imagine a software development company has agreed to build a custom application for a client, with the initial scope of work including specific features such as user login, basic functionality, and a reporting system. Halfway through the project, the client requests additional features, such as real-time analytics and mobile compatibility.
This request represents a change of scope, as the original agreement did not include these features. The software development company and the client would need to negotiate the terms of the new scope, including the additional cost, time needed for the new features, and any resources required. Once agreed upon, the contract is updated to reflect the new scope, and a change order is issued to formalize the modification.
Example of change of scope clause
Here’s an example of how a change of scope clause might be written in a contract:
"The Parties acknowledge that any modifications or additions to the Scope of Work must be agreed upon in writing and documented through a formal Change Order. Any changes to the project scope that result in additional costs, time, or resources will be addressed in the Change Order, and such changes will only be implemented once approved by both Parties."
Conclusion
A change of scope is a crucial concept in contract management, project execution, and business agreements. It ensures that all parties involved understand and agree upon any modifications to the original terms of the contract, helping to avoid confusion, delays, and budget issues. By properly managing and documenting changes to the scope, businesses can adapt to evolving needs while maintaining control over the project’s direction and ensuring a successful outcome.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.