What is "Gold Plating" and Why Should You Avoid it in Projects?

4/28/2011 Carsten Howitz Project Management

First, let me ask you to think about which is better: To meet your customer’s expectations or to exceed their expectations? If your answer is to exceed their expectations you really need to read on.

I sometimes come across companies that proudly show me their corporate mission: “Our mission is to exceed our customer’s expectations”. So is there anything wrong with that? Absolutely! In my opinion there is no way you can constantly exceed your customer’s expectation. Let me give you an example.

A courier company has the mission to exceed their customer’s expectations. How can they do that? They can deliver the packages faster than promised. So if they promise to deliver in three days they can deliver in two, which would exceed their customer’s expectations. If they do that for a while the customer begins to expect this, and in order to exceed their expectations now they have to deliver in one day. Soon the customer gets to expect this and in order to exceed the customer’s expectation they now have to deliver same day. So slowly but surely the company will not be able to exceed their customer’s expectation simply because it is impossible.

My point is that you should never make it your mission to exceed your customer’s expectations. Instead just meet them.

When we refer to the project scope we are referring to the work needed to successfully complete the project and only that work. Some companies have the same mission as the courier company in the example above. Thus they want to exceed the customer’s expectation. In a project they can do that by delivering more than they agreed upon. This practice is called “Gold Plating” and I strongly discourage you to gold plate any project and I will explain why.

What happens when we deliver more than we agreed to do? We increase the scope. Scope, schedule, cost, quality, and risk are all interdependent, which means that if you change one the other ones will also change. So by changing the scope we also affect the schedule and especially the risks. We just made the project more complex, we are not getting paid for it, it was never planned for, we have to spend more time on it, and we just introduced a considerable portion of risk into the project; risk that we never had to add to the project in the first place.

What happens now if the additional scope causes other parts of the project to stop working or causes the timeline to expand? The project fails!

The project manager’s job is not to exceed the customer’s expectation but to deliver what was agreed upon and nothing else! If the customer wants additional scope to be added to the project it is always handled in the Integrated Change Control process. If approved by the customer it may cause new baselines to be created. It could also cause the project to be delivered at a later date or cost more. Since that would result in new baselines for time and cost, that is exactly how the project manager should handle that.

You may ask if trying to exceed the customer’s expectation is the same as the “Scope Creep”? They are closely related. The scope creep is often introduced and grows by allowing small additions to the scope without using change control. Eventually all these little changes amount to a large scope creep that can cause the project to fail for the same reasons as gold plating, since the scope and risk are affected. The main difference is that gold plating is a conscious decision by the project manager, or his or her company, to deliver more than agreed upon to honor their corporate mission.

If you, as a project manager, gold plate a project and allow the scope to increase without change control, your project has failed. It’s as simple as that. Even if you deliver the project with the additional scope on time and within budget it is still a failure in my eyes. Why? Because you allowed unnecessary risk to be added to the project and that alone is a failure.

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