Does the mere idea of a change order from your client make you anxious? Change orders can completely throw a construction project off track, affecting both the time of completion and the cost – and clients don’t always really understand the ramifications of what they’re asking.
Unfortunately, change orders are just a fact of life when you’re in the construction business. That means you need to minimize the potential problems that they will cause. Here are some tips that may help:
Make sure that your contracts are clear
The clearer the scope of your work, the easier it is to minimize change orders in the first place. Anything that seems vague should be reviewed and the details added to the agreement before work begins.
You also need to have some kind of agreement about what requires an actual change order (versus a request that requires minimal adjustment to costs and plans).
Have a plan surrounding how change orders are processed
The only thing harder than handling change orders is trying to handle them when there are no clear expectations surrounding the process. That can lead to confusion for you, your subcontractors, the engineer and your clients.
It’s wise to require change orders to be written. You should also specifically address how the additional costs will be calculated – and who has to agree to those costs before the change order can take effect.
Know how to communicate the impact of change orders
There are a lot of people who may be affected by a change order. It can extend the time you need your subcontractors and drag out a project considerably. Make sure that you have a system in place to keep all the stakeholders appraised and coordinate both the design elements and responses to requests for changes.
When construction disputes do arise (despite all your efforts to avoid them), make sure that you have a clear understanding of your legal position and rights.