Let's look at a scenario: You have worked with your client to determine the business requirements for a new solution. After gathering all 100 requirements, you estimate the time and money that is required to deliver the requested solution. However, the client tells you that they do not have enough money in the budget, so they have to cut back their list of requirements from 100 to 80.
Now let's say that as the project progresses, you realize that you can actually finish the project earlier and for less money that you estimated. You further decide it would be a nice surprise to include the extra 20 requirements that the client initially requested. You deliver all 100 requirements but find out that the client is now upset at you. Why did this happen?
Let's first take a step back. The project manager should always strive to understand the expectations of the customer and then meet those expectations. This makes sense. But what if you have a chance to exceed the expectations of the customer?
The term "goldplating" refers to delivering more requirements than what the client requested. Even though it might seem that this is a good thing, it actually isn't. It's wrong for two reasons. First, the primary focus of the project should be to make sure that you deliver what the client wants--on time and within budget. By adding additional work, the risk increases that the project will not meet its deadline or budget. If you end up missing your deadline date, you won't get any sympathy if you explain that the date was missed because you added more work than the client agreed to.
Second, if you goldplate, you're taking it upon yourself to make a business decision on what is of most value to the client--the extra requirements, or to complete the project early and underbudget. In our prior example this decision is easy to see. If you determine that you're going to complete the project early, you shouldn't make the decision on what to do with that good fortune. The client may want to add the additional requirements. On the other hand, the client may prefer that the project finish early and underbudget. The client may have other projects they would like to start early or they may have a better use for the remaining budget.
You may have heard it's better to underpromise, but overdeliver. This is actually a good thing if it refers to your ability to deliver your work earlier than promised or for less money than you estimated. However, it's not the right thing to do in terms of business requirements. If you can complete the project earlier or for less money than was budgeted, let the client make the decision on what to do with the good fortune.