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Scope of work and scope of services traditionally have the greatest impact on raising your profitability, yet they are not the only ways open to A/E firm principals eager to exert more influence over their financial destiny.
Scope of work. In consultation with your client, define the expected scope of work for the project more precisely than you have in the past. Then document that understanding in a written summary and share it with your client before you execute an agreement. This will avoid the negative effect of "scope creep" on your project's financial performance.
Avoid using ambiguous terms in the definition. For example, terms such as "renovation" or "code upgrades" do not adequately describe what is to be done within an existing facility. When you remove the existing suspended ceilings to install a sprinkler system to satisfy a code requirement, is it the owner's intent to reinstall the existing lighting or to replace it with new lighting?
The final scope of work should clarify issues such as this. If the client is not willing to help you define the scope of work as precisely as possible for this purpose, this may be a signal that the client has unrealistic expectations of you in the future.
Scope of services. While the standard AIA agreements offer comprehensive terms covering all the requisite aspects of a typical project, many of the terms related to the A/E's services are vague or too broad. They end up creating expectations on the part of the owner that may be very different from yours. To reduce the vagueness of these terms, insert additional language in your contracts, as suggested below:
* Surveys and borings. It is clearly the owner's responsibility to provide this information, but how often do you spend uncompensated time defining the survey parameters or soliciting proposals on the owner's behalf? Rather than give those services away for free, get compensated for them by adding contract language that makes it clear that such services are part of the owner's responsibility.
* Existing drawings. The same issues noted for surveys and borings apply to existing drawings. Rather than spending hours in the owner's basement searching for the appropriate documentation, make it clear that it is the owner's responsibility to...