Why agency projects overrun: five delivery fixes that work

The pattern

The agency grows past 15 or 20 people. The founder can no longer see every project. Margins that looked fine at proposal stage disappear in delivery, and the founder only finds out when the final invoice is short or the client escalates. Delivery depends on two or three people who hold everything together.

This is a system problem, not a people problem. Here are the five fixes we’d make first.

Fix 1: Sell discovery as its own paid phase

Most overruns are baked in when a fixed price is quoted before anyone understands the integrations, the data or the client’s real requirements.

Do this: sell a short, fixed-price discovery (two to four weeks) that produces the requirements, the integration map and a firm build estimate. Clients who won’t pay for discovery are telling you how the project will go.

Fix 2: Estimate in ranges, and check estimates against actuals

Single-number estimates hide uncertainty. And if nobody compares estimates with what work actually took, the same mistakes repeat on every proposal.

Do this: estimate each workstream as a low–high range with its assumptions listed. Have a second senior person review every estimate over an agreed size. After each project, compare estimate to actual by workstream; within a few months you’ll know exactly where you under-quote (it’s usually integrations, data and testing).

Fix 3: Start change control in week one

On many projects, small favours accumulate into weeks of unbilled work. By the time anyone raises it, the client sees it as part of the deal.

Do this: keep a change log from the kickoff. Every request outside scope is logged, estimated and approved or declined in writing, even when you decide to do it for free. A free change that’s recorded builds goodwill; an unrecorded one becomes scope.

Fix 4: Track project health weekly, on money, not just status

RAG status reports are usually green until they’re suddenly red. A single number catches problems earlier.

The burn ratio = % of budget spent ÷ % of work complete.

Review every live project’s burn ratio in one 30-minute meeting each week. “% complete” must be judged by deliverables accepted, not by hours spent.

Fix 5: One view of resourcing

When developers work across five projects at once, every project slows, and the loudest client wins.

Do this: keep one resourcing plan for the whole agency, owned by one person and updated weekly. Limit how many projects one person works on at a time. Make the trade-offs visible: if a new project starts, something else visibly moves.

Where to start

Don’t do all five at once. Start with Fix 4: it costs nothing, takes a week to set up, and shows you which of the other four matters most for your agency.

If you’d like an outside view, our Delivery Operations Review looks at your delivery process, estimating, resourcing and project margins over two to three weeks and gives you a prioritised fix plan. See how we work with agencies.