Oops... Additional work
It's not uncommon for additional work to arise at some point during the execution of a project. If you're not careful, this can lead to frustration within your own organization (because hours aren't billed) or with your client (who suddenly hears that hours still need to be billed).
Remember the win-win quadrant from Chapter 1.6 "Dare – No is Okay"? There, we discussed the pitfall of giving too much away to your client and shortchanging yourself. Or, conversely, shortchanging your client. We both want to avoid that.
Some people tend to give away extra effort easily, by booking hours on an internal code or working a few extra hours in the evening. And others tend to be a bit too strict when it comes to billing.
It's helpful to discuss potential additional work with a colleague who isn't directly involved. This provides an outsider's perspective and helps you determine whether you're being too kind or too strict with your client in certain situations.
Calculation example
Suppose you have a project with a turnover of €50.000. And you don't charge €1.000 for additional work. That's a shame, but it's only 2%, right?
Well, no, because you only make a profit out of that €50.000 turnover. If you do well, you'll make 10%, or €5.000. That's the amount you'll have left at the end of the year, which you can use for fun things. And if you give away €1.000 of that, 20% of your profit will just go down the drain.
When managing overtime issues, three moments are important:
- At the start of the process – make the topic open for discussion.
- If you foresee additional work during the project.
- If it turns out that additional work has unexpectedly been carried out, but has not yet been discussed with your customer.
It helps to discuss with your client at the start of a project that adjusting the scope or performing additional work is a common occurrence in practice. This isn't due to poor planning or unclear scope, but rather to evolving insights and unexpected obstacles. And often, it's also driven by enthusiasm, as both the client and you see what else is possible along the way.
Therefore, agree to include any additional or reduced work on the agenda during regular meetings. Or to maintain a joint "issue list" to track scope changes and additional or reduced work. And definitely do this during internal project meetings as well. After all, prevention is better than cure.
An organization that develops apps had to deal with a lot of overtime. Actually, more often than not. These days, they discuss it from the very start of the project. They say something like: Dear customer, we're delighted to be working on the app. Experience has shown that with an app, you often only truly understand what you want once you see what you're getting. Even if we carefully consider the scope beforehand, we or you might get so enthusiastic during construction that we start thinking about how to make it even better. And before you know it, we're going over budget. Therefore, I'd like to agree with you that we'll put the scope and additional work on the agenda during our biweekly progress meetings. If there's nothing to discuss, we'll be done quickly, and if either of us thinks there is something to discuss, we'll be there in time. The effect is that additional work is discussed much sooner, and customers also realise sooner whether something does or does not fall within the agreed scope.
The second time to discuss additional work is when you get the first signals. The client asks you for something, and you have a feeling, in your gut, that you're entering a gray area.
Because when it comes to additional work, it’s not always black or white.
- Sometimes it's a blank slate: your client requests something, and you immediately know it's within the scope. No extra work, no big deal. You can just mention that. Great idea, and it's completely within the scope of this project, so we'll do it.
- Sometimes you know right away that something is out of scope. Essentially, you're getting a buy signal. Naturally, you want to address that and make an appointment right away.
- And it will also happen that you don't know the answer right away. That's, of course, the most challenging.
If you know right away that something will require additional work, it helps to point that out as quickly as possible. Even if you think the client understands, this will prevent any surprises regarding how you handle this. For example:
What you ask is certainly possible,
And that's an expansion of the work, which doesn't fall within the current scope, and which requires an investment. So, a few extra hours will be added to the bill. I estimate about forty hours...
Is that okay?
Perhaps your client wants to make a more concrete agreement about those 40 hours first, or perhaps they want to discuss internally whether there's a budget for it, or perhaps it's all fine. As long as we can agree on how to handle this.
In fact, the request for additional work is a buying signal as discussed in chapter 2.1 Buying Signals: Offer Help to Your Customers. And the following applies: Yes is hooray, and no is okay. In between, it's way too much work.
But what if you know it's additional work, but you don't yet know exactly how much? Then you say so. Your IMI might be something like:
Yes, that is possible, and it also seems to me to be a useful addition.
And it is an extension of the program, so that means an invoice will be issued at some point. I don't have a clear idea of the amount yet...
Should I look into that so I can give you an indication of that next week?
If you don't know right away whether something is extra work or not, trouble is just around the corner. Many content-focused people naturally have their hearts set on the client and the project's content. It's a good idea, they understand the request, and they don't want to be a whiner. And well, how much work is it really if everything goes according to plan? But it doesn't always go according to plan...
Another pitfall in this gray area is the tendency to only discuss problems with the client when you already know the answer. Whether it's additional work, and exactly how much extra time or money is involved. In many cases, figuring that out takes days rather than hours, and meanwhile, the clock is ticking.
It's best to discuss potential additional work early and manage expectations, even if you don't yet know the details. It helps to have a few sentences ready in such cases. This prevents surprises, maintains a good relationship, and also raises the possibility of paid additional work. Then your client will at least know that we're in the gray area.
A few examples in response to a customer request that smells of additional work:
What you ask is certainly possible, and I will be happy to do so.
What I don't know is to what extent that question also falls within the current scope of this project...
I'll look into that and let you know, okay?
Of
I heard this morning from the development team that they'd like to design a report about ABC. That certainly seems like a useful addition.
What I don't know is whether that falls within the scope of this assignment or not.
Should I ask Bertine Baas to call you about that?
Of course, it's also possible that the additional work doesn't stem from an additional customer request, but that you yourself discover that more is needed than initially estimated. For example:
I have to get something off my chest…
We've discovered that, against all expectations, bats are present at this construction site. We hadn't anticipated this, and we have to address it. Our contract doesn't clearly state whether this falls within the scope or not.
Should we discuss how to deal with this?
It's certainly helpful if you already have an idea of how you want to handle this, or what the options are. Another scenario is that you decide for yourself that additional work might be worthwhile, so you take the initiative.
It's not uncommon for additional work to arise at some point during the execution of a project. If you're not careful, this can lead to frustration within your own organization (because hours aren't billed) or with your client (who suddenly hears that hours still need to be billed).
I want to discuss something with you…
As discussed, we're replacing the tram track and road surface on the Krokobrug. The bridge will be closed for three months for this. It now appears that the bridge motor will need replacing in two years. Replacing the motor now would be a bit more expensive, as the depreciation period will increase from 50 to 48 years. However, it's good for residents that the bridge won't be closed for another extended period in two years.
What do you think, do or not?
Make your own version and practice a few times until the sentence flows smoothly. Preferably with colleagues.
Name gifts
If you order an extra dish at a restaurant, you pay for it. Sometimes the waiter will give you a drink on the house. And they make it a special occasion.
Sometimes you do a little extra work for free. For example, because the administration surrounding the extra work takes more time than the extra work itself. In that case, it's a good idea to make it clear that you're giving a gift.
This can be discussed during a regular project review. You can also include it on the invoice with a €0 amount added.
This way, your client will notice that you occasionally go the extra mile. This is good for your relationship and for the balance of give and take. Should additional work ever arise, the other party will likely be more willing to accept it.
Despite all the measures taken, things can still go wrong. Especially in complex projects, you might discover at some point that more hours have been used than intended. What then? Then it's time to "Name What Is," as described in Chapter 6.7. In this specific case, that might be something like:
Tjerk, I'm having a problem... I looked at our timesheets this morning and saw that, in our enthusiasm, we went 45 hours over budget. I didn't pay close attention to the number of hours we spent...
(don't explain too much now, and just keep your mouth shut for a moment, so the other person has time to let the bad news sink in.)
Tjerk might say something like: That's not so good.
Consultant: Yeah, I don't think it's very pretty either... How are we going to deal with that?
Now the ball is in Tjerk's court. Of course, Tjerk doesn't automatically cheerfully say you can send the bill. But many customers find discussing the situation much more pleasant than finding an unsolicited extra invoice in the mail.
Here too, it is of course a good idea that you have already thought about what you consider a reasonable way to deal with the situation.
- Arrange the administrative aspects of additional work properly. Discuss additional work verbally and confirm by email. Even minor adjustments should be addressed.
- If additional work occurs frequently, you can maintain a list of additional and reduced work that you discuss periodically in internal project meetings and in progress meetings with your client.
- If additional work is unexpectedly added, explain why. For example: Our people are so enthusiastic that they created an extra module without asking.
- For additional work in the gray area, you can consider in advance what your BAZO (Best Alternative Without Agreement) is. What if you can't agree? Will you pay for it yourself this time, or will you involve a lawyer? Become aware and make a choice.
- From a customer loyalty perspective, additional work sometimes feels "grayer" than it actually is. In that case, it's better to tell them there's additional work than to hesitantly ask your customer for their opinion.
- Don't be too quick to assume that the other person will understand that something involves extra work.
- Factor in additional work in your solution on a single page and your quote, especially if you're a rather optimistic calculator or for a long-term project. Have a colleague review this.
- Choose your words carefully. I would like to discuss periodic additional work sounds different than I would like to discuss possible scope changes periodically.
- It helps to have a few handy phrases at the ready so you don't have to search for words in emergencies and can respond quickly. For example: Great idea, and that's an extension of the scope...
This article was written by Jan Willem van den Brink and Maarten van Os from DreamfactoryIt's based on a chapter from our book Client Wanted – Acquiring as part of your job.
If you wish to use it, we would greatly appreciate attribution.
Want to know more about this topic or how we can help your organization? Email or call us at 0348-741670.