A quick guide to managing change orders in construction


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Change orders are an inevitable part of working in the construction industry. You may have had to deal with them at some point in a project and you will continue to engage with them on future projects. When change orders are not managed properly, they can quickly hamper project success. Increased project costs, delays in reaching major contract milestones, interrupted workflow, and not completing the project on time are some of the issues that can result from problems with change orders not being addressed and resolved early. The ability to effectively manage change orders does not have to be difficult. All it takes is a little preparation, understanding and a lot of communication with all of the parties involved in the project. Getting clarification on the scope of work Your first step before signing a contract and starting any work is to review plans and specifications with all parties involved in the project. Get clarification from the client, architect and engineers regarding any questions you have regarding the scope of the project. Any aspect of the project that is vague or unclear about what is expected should be resolved. This is also a good time to address any errors or omissions identified in the plans and specifications. Ensure that any subcontractors you do their work are also clear about the work they have been contracted to complete. Construction contract review The next step is contract review. Make sure there is a clause written in the contract that addresses exactly how change orders are handled. This includes procedures for issuing any modifications to the original scope of work that will lead to the completion of new or different work. Disagreements over what warrants a change order are common, because they affect the different parties involved in different ways, so clarifying any discrepancies or ambiguous elements in scope, plans and specifications can go a long way in eliminating the need for change orders down the road. The contract should specify how the work cost is calculated from change orders including equipment costs, overheads and materials. How change orders affect schedule changes and delays in the contract should also be covered. Be sure to include the written change request form in the contract. Obtain written approval for all change orders. Avoid conflicting clauses in the contract regarding change orders. If the contract states that the contractor cannot commence work on any changes without a written change order, then there should be no language stating that the owner can request additional work to be performed without a compensation agreement. He made it clear that no new or additional work will be carried out without a written change order or a written notice to follow-up signed by all concerned parties. There are times when a change order does not affect the cost or schedule of the project, but this is not always the case, which is why it is important that the contract covers how these elements are handled. Communication with stakeholders Change orders are issued for a number of reasons. A customer can change his mind about what he wants to do, or unexpected or changes in site conditions may require additional work, omissions and errors in plans are all common reasons for change orders. It is important to communicate and have an open dialogue with the client, designers and any affected subcontractors when the matter of change comes. Inform your customer of any work that needs to be stopped as a result of the changes and discuss any delays or schedule changes that need to be made. Ensure that all labor, materials and equipment needs are accounted for in the change order, whether the new work required will adversely affect any work already completed. Understand the impact of change orders Remember to consider how each change order will affect subcontractors on the project. Work with your subscribers to assess any changes to their costs and schedule and determine how their contracted work will be affected by the change order. If you encounter multiple change orders on a project, confirm and review the combined effect of the project as a whole. Determine how it will affect your productivity and the pressure it will place on your resources (workers and equipment). A large number of high-impact change orders can lead to a backlog of work, so careful planning and scheduling of your resources and subcontractors is vital to avoid disruptions to project flow. Final thoughts on change orders Change orders are part of doing business in construction but can be easily managed by requiring written documentation and being honest and honest with your customer about the time and money it will cost to make these changes.


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