The Third Revision Was Free Because Nobody Wrote Down That the Second Was the Last
· 7 min read · Written by Faceela Research & Editorial Team
Reviewed by Ahmed Hassan Algammal — Founder and Enterprise Systems Consultant
An engagement letter is the only enforceable statement of what a firm agreed to do. It is signed, it is dated, and in most firms it is read exactly twice — once by the partner who drafted it and once by the client's finance director, who is checking the fee.
The people who then deliver the work have usually never opened it. They receive a job, a deadline and a client contact, and they get on with it. This is not carelessness. It is the normal division of labour in a professional firm, and it is the mechanism behind almost every overrun, because the person doing the work is never the person who read the letter.
Scope is three territories, not two
Firms talk about scope as if it were a line with an inside and an outside. It is not. There are three territories, and only two of them have any writing in them.
There is what was written in: the deliverables, the periods, the number of revisions if anyone thought to say. There is what was written out: the exclusions, usually a short list assembled from whatever went wrong on the last job like this one. And there is everything else — the requests nobody imagined at the time, which is by far the largest territory and the only one that contains no document at all.
The shape of it
Three places a client request can land
Written in
How the line got there
Somebody drafted it, somebody signed it, and both of them read it.
What happens to the request
It is delivered. Correctly, on time, and to the standard the letter describes.
Who decides
The person doing the work, from the work plan.
What it costs the firm
Nothing extra. This is the engagement working as sold.
Written out
How the line got there
Somebody thought about it hard enough to exclude it in a sentence.
What happens to the request
It is quoted, or it is declined. Either conversation is short, because there is a line to point at that the client has already signed.
Who decides
Whoever owns the engagement, in one email.
What it costs the firm
Ten minutes, and no damage to the relationship.
Never stated
How the line got there
Nobody wrote it, because at the time nobody imagined the request. This is the largest of the three territories and the only one with no document in it.
What happens to the request
It is done. Usually well, usually the same week, and usually before anyone thinks to ask whether it was ever in the fee.
Who decides
Whoever received the email. Frequently a manager who has never read the engagement letter.
What it costs the firm
Every overrun on the job, and it is invisible until the recovery figure arrives.
You cannot shrink the third territory. You can only make it visible
No engagement letter has ever anticipated every request, and a firm that tries to write one produces a document nobody reads, which makes the problem worse. What changes the outcome is that a request landing in the third territory gets recorded in seconds by the person who received it — before anybody has decided whether to charge for it. The decision can wait. The record cannot.
The reason overruns live in the third territory is not that people are weak about saying no. It is that saying no requires knowing there is something to say no to, and a request that falls outside a written boundary does not announce itself. It arrives as a sentence in an email that reads exactly like every other sentence in that email.
What the request actually looks like
It is worth being concrete, because the abstraction makes it sound avoidable.
The client's financial controller writes on a Tuesday afternoon: while you have the file open, could you also give us the comparative for last year on the same basis? Or: the board asked whether we can see it split by branch. Or: can we do one more version with the new numbers before Sunday?
Nobody at either end experiences this as a change to a contract. The client is asking a professional a question. The manager who receives it can answer it in half a day and knows the relationship is better if she does. There is no moment in the exchange where anyone stops and asks whether it is in the fee, because the exchange has no such moment in it — it is an email, and emails do not have gates.
By the time the engagement's recovery is computed, three months later, the half day is one of eleven such half days, and none of them exists as a record of anything. What exists is a figure that is lower than it should be, and a partner who concludes that the fee was too low.
The fee was probably fine. The job that was done was not the job that was priced.
The variation conversation that never happens
Ask a partner why an out-of-scope request was absorbed and the answer is almost always about the relationship.
We are up for renewal in two months. It is a small thing and raising it would look petty. The client is under pressure. It was our own mistake in the first draft, arguably. He is a personal contact of the senior partner.
Every one of those is a real commercial judgement and some of them are correct. The problem is that they are being made at the wrong level, by the wrong person, without the information that would make them decisions rather than reflexes.
The manager who absorbs the eleventh half day does not know it is the eleventh. She knows this one is small, which it is. The partner who would happily raise a variation for eleven half days never sees them, because each one was individually too small to escalate and there is no place where they add up.
This is the whole mechanism, and it is why "have the conversation with the client" is not the fix. The conversation cannot happen if the fact does not exist.
Separate the record from the decision
The single most useful change a firm can make here costs nothing in client goodwill, because it does not involve the client at all.
Recording that a request was out of scope must be cheap and immediate, and it must not commit anybody to charging for it. Those are two different acts, and firms conflate them. A manager will not raise a variation, because raising a variation means a conversation she does not want to have. She will happily log fifteen minutes against "additional client request" if doing so is one click and implies nothing.
Then the decision moves to where it belongs. At the end of the month, somebody with the authority to make commercial judgements looks at eleven logged requests, decides that seven are goodwill and four are a variation, and has one conversation instead of eleven avoided ones. The client hears about the four with evidence attached, months earlier than he would otherwise, and in a form that reads as a well-run engagement rather than as a complaint.
| Where the boundary is written | What the request costs to handle | Who ends up deciding |
|---|---|---|
| In the letter, as a deliverable | Nothing — it is the work | The work plan |
| In the letter, as an exclusion | One short email quoting a signed line | The engagement owner |
| In the work plan, as a stated assumption | A short internal check before it is started | The manager, correctly |
| Nowhere at all | The work, done immediately and silently | Whoever opened the email |
The third row is the one most firms are missing and the cheapest to add. An assumption is a boundary that has not been agreed with the client yet, and writing them down at planning time — the number of revisions, the state the client's records will arrive in, who will chase the client's own bank for confirmations — converts a large part of the silent territory into the written one before the work begins.
What to make a vendor show you
On a live system, on a real engagement, not on slides.
- Show the engagement's scope, exclusions and stated assumptions on the same record as the work, visible to the person doing the work.
- Log an out-of-scope request in one step, from the task, without deciding whether to bill it.
- Show all logged requests for one engagement, with their time against them, on one screen.
- Convert some of them into a variation and leave the rest as recorded goodwill — and show that both remain visible afterwards.
- Show recovery on the engagement with the absorbed requests separated from the priced work.
- Show the same picture across every live engagement for one partner.
- Take a scope change and show it reaching the fee, the plan and the invoice without anyone retyping it.
Item 2 is the one that decides it. Every system on the market can raise a change order, and every one of them will demo it beautifully. Almost none of them lets somebody record an out-of-scope request without committing to a commercial position on it — and that gap is precisely why the eleven half days never exist. If logging the request and starting an argument are the same action, nobody will log the request.
Item 1 is the quiet one. A scope statement stored in the document management system, three folders away from the task, is a scope statement nobody reads. It has to be on the screen the work happens on.
The short version
Scope is written in, written out, or silent — and the silent territory is the largest, the only one with no document, and the one every overrun comes from.
The person who reads the engagement letter is not the person who receives the request, and the request arrives as an ordinary email with no gate in it. So the absorption happens one small favour at a time, none of them big enough to escalate, and nothing anywhere adds them up.
Making the record cheap and separating it from the commercial decision fixes both halves at once. The manager logs a fact without starting a fight. The partner sees eleven facts and makes one judgement, with evidence, in time for it to be a conversation rather than a complaint.
What the absorbed work does to the fee is the realisation bridge; why it never reaches the invoice at all is unbilled work in progress; and none of it is measurable unless the half days were recorded, which is the timesheet problem. Whether the engagement should have been fixed-fee in the first place is fixed fee versus time and materials.
The wider picture for a firm is the professional and business services page, and the system is ServX — where a milestone cannot be invoiced without a signed client acceptance behind it, which is the same discipline applied at the other end of the same problem.