Guide to Project Scope in Business

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Guide to Project Scope in Business

According to the Project Management Institute, adversarial scope changes are the biggest cause of project failure. Project scope in business is a crucial component of project management, and when not clearly defined, it can lead to serious schedule and budget challenges.

Read on to learn more about what project scope in business is and best practices for writing and managing one.

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What is Project Scope and Why is It Important?

The scope of a project defines what is part of the project and what is not. Project scope definition is a concept that is not clearly captured, explaining why it’s problematic for many teams. It represents the sum of things that a project has to take care of, including its purpose, objective, and how to achieve them. Scope defines the project boundaries.

Since a project is a temporary endeavor with a start and end date, poorly defined boundaries results in moving goal posts that make it harder to manage projects.

Here’s a real-life example.

When the team behind the Royal Adelaide Hospital construction closed the project, they realized it was 18 months behind schedule and AU$640 million over budget. The total cost reached AU$2.3 billion, making the hospital the most expensive building in Australia. The primary reason why the project ended this way was because of project scope changes that included requests to add features such as service robots that deliver linen and digital tags that track medical equipment and patients. 

A loosely defined project scope increases the risk of the project going behind schedule or over budget or both. To avoid these, project managers need to write a good project scope statement.


Read also: What is Scope Creep in Project Management?


What is Project Scope Statement?

A project scope statement outlines the entire project. It includes a description of the scope, deliverables and their features, justification of why the sponsors initiated the project, exclusions, constraints, and assumptions.

Overall scope description: The scope description is a high-level statement that lists what is within the scope of the project. It is an important step that helps establish the boundaries for the project.


Read More: Project Statement of Work (SoW)


Project deliverables: The project team lists the deliverables that the project aims to produce in order to meet the business objective or client need. It includes the key components that constitute a successful project. This section identifies the key features and can include instruction manuals and other marketing documents or materials.

Project justification: Project justification, sometimes called business case, provides a better understanding of the scope statement. It explains the need for the project and how the end result solves that need.


Read More: How to Effectively Participate in Meetings


Project exclusions: At the start of the project, not all information is available or known, so it may include uncertainties. Just as it is important to identify the boundaries and state what the project includes, it is also as important to list out what is not included in the project to dispel any wrong assumptions.


Read More: Service-Level Agreement in Project Management


Project constraints: All projects have time, budget, and scope constraints all interconnecting at some level. But other constraints can exist for projects, such as resources, methods, or customers. The project team needs to list all constraints so they are ready to build solutions when needed.

Assumptions: This section lists the assumptions the project team made in defining the scope of the project. The team should list all those conditions and the impact those assumptions have on the project if it turns out they were inaccurate.


Read More: What is Project Management? Definition, Types, and Examples


Project Scope Example

Project managers do not know all project boundaries at the time of writing the scope statement. But that’s okay, as long as they remember that all uncertainties are risks that can be come project schedule or project cost issues. The following is a simple project scope example.

Project scope sample

Project Scope Management

Writing a good project scope statement limits the risks and unpleasant possibilities coming from poorly defined project boundaries. A clear scope statement makes it easy for stakeholders to accept them, put the project team in sync, and prevent unauthorized tasks from creeping in. Project scope management is a knowledge area that professional project managers study and practice. The PMBOK identifies six processes:

  • Planning scope management: planning the process and creating the plan
  • Collecting requirements: defining and documenting stakeholder needs and other requirements that the project needs to meet
  • Defining scope: compiling the requirements into a scope statement
  • Creating WBS: subdividing project deliverables into smaller work packages and tasks
  • Validating scope: formalizing the acceptance of the deliverables
  • Controlling scope: monitoring and managing changes into the project scope

    Read also: Managing Scope During Project Life Cycle Phases


    Best Practices for Project Scope Writing and Management

    Every project includes uncertainties. Project managers have no way to include each one of them as they write their project scope. But there are three ways to deal with uncertainties and risks:

    • Accept the risk and take on additional time, cost, or scope.
    • Transfer the risk to a third party and let them assume partly or wholly the cost.
    • Mitigate the risk by performing actions that will reduce the risk of the uncertainty.

    In writing project statements, here are some of the best practices to consider while writing your project scope:

    • Avoid jargons and keep the language consistent and clear for all project stakeholders and participants.
    • Keep it short and simple, and save the details for the full project plan.
    • Avoid sweeping statements so as not to overcommit and underdeliver.

    Watch out for scope creep. Instead of making corrective but costly actions later in the project, consider the following straightforward steps as preventive measures:

    • Limit timelines and rein in schedules from the start to ensure a smaller and more manageable scope.
    • Identify what’s out of scope and define both sides of the boundary with project sponsors.
    • Build contingencies such as a strong contingency budget to limit the negative impact of scope creep.

    Read More: What Is Traceability and How Does It Impact Project Management?

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