Change is an inevitable and ever-present force in the construction industry. Contractors must be prepared for construction change orders and the associated costs that come along with them.
A construction change order is a document that outlines changes to the scope, cost, or schedule of a construction project. These changes can be requested by the owner, architect, or contractor and must be approved by all parties before they can be implemented.
To utilize a change order, you must have a contract/agreement.
Common reasons for change orders
Everyone knows that something is bound to be a little off-kilter from the original plan as soon as it’s in writing. Especially if the job is projected to take the company months or even years to complete!
There are many reasons that change orders may be requested during a construction project. Some of the most common include:
- Unforeseen site conditions: Sometimes the conditions at the job site are different from what was expected, and changes to the original plans may be necessary to accommodate these conditions.
- Owner-requested changes: The owner or client may request changes to the original plans or specifications, such as adding or removing a feature.
- Design errors or omissions: Errors or omissions in the original plans or specifications may be discovered during the construction process, requiring changes to be made.
- Material availability: Material availability may change and force the contractor to change the originally planned material.
- Change in design standards: There may be a change in design standards or building codes that require changes to be made to the original plans.
- Change in schedule: The project schedule may change, requiring changes to be made to the original plans to accommodate the new schedule.
- Change in the budget: The project budget may change, requiring changes to be made to the original plans to accommodate the new budget.
- Subcontractors: Subcontractors may come across issues that they did not plan for, which leads to the need for change orders.
The main purpose of a change order is to ensure that any changes to the project are clearly documented and that all parties are aware of the impact on the project’s budget and schedule.
How Does a Change Order Process Go?
Change Order Request
Before a change order can be issued, the project manager, general contractor, or owner must request it in writing to document changes made to the original construction plans or specifications.
When does a change order become legally binding?
The form is usually submitted for approval by the owner or client before the change is implemented. Once approved, the form is a legal document that outlines the change and any agreements on cost and schedule impacts.
It is important that all parties are involved in the project review and understand the change order before it is implemented.
What to include in a change order request form?
Provide a detailed description of the change, the reason for the change, supporting documentation, the estimated cost of the change, and any impact on the project schedule.
It’s crucial to clearly understand how the change order will affect the project’s timeline. This includes ensuring that all parties know the new completion date if the change order delays the project completion.
How can I stay updated on a project’s timeline?
Having progress tracking capabilities allows contractors to understand a project’s timeline by providing them with real-time information about the status of the project. This information can be used to identify any delays or issues affecting the project schedule and make adjustments as necessary. With progress tracking, contractors can:
- Track progress: Progress tracking allows contractors to monitor the progress of each task and compare it to the original schedule, which helps identify any delays or issues that may be affecting the project timeline.
- Identify critical paths: Contractors can identify the critical paths of the project, which are the tasks that must be completed on time for the project to be completed on schedule.
- Monitor resource utilization: Easily resource utilization, such as labor and materials, which helps identify any issues affecting the project schedule.
- Communicate with stakeholders: Stay in contact with stakeholders, like the owner/client, by giving them real-time info about the project. This helps everyone stay updated and in agreement.
- Improve forecasting: Always know the state of a project, enabling you to understand the remaining work better and make better forecasts of the project completion date and costs.
Overall, progress-tracking capabilities provide contractors with valuable information that can be used to identify issues, make adjustments, and improve the overall project timeline.
What to be aware of when handling change orders.
Unfortunately, timelines for construction projects are not always followed as expected, which can take a toll on businesses that are involved in the project. In order to avoid contract disputes when dealing with change orders, it is essential to have an effective plan in place.
If disputes do arise, it can lead to costly delays, disruption of the project, and even long-term legal proceedings. It is important to be aware of the potential for contract disputes and have strategies in place to help minimize their impact.
One final tip on dealing with change orders.
When it comes to change orders, information is king. Knowing not only when things fall off track, but why will help you make the appropriate changes and avoid derailment in the future. Having clear documentation and data from every aspect of your project will make your life infinitely easier when change orders come into play.
busybusy is a construction time tracking and job site management platform that helps contractors with change order forms in several ways:
- Capture all necessary data: busybusy allows contractors to capture all necessary data related to the change order, such as the reason for the change, the cost of the change, and any impact on the project schedule. Create a schedule, notify employees, and even attach detailed instructions for any changes. This helps to ensure that the form is complete and accurate and that your crew doesn’t waste time standing around on the job site.
- Keeping a record of all change orders: Now you can upload all kinds of documents like change requests, site plans, permits, zoning certificates, diagrams, building codes, expense report forms, and even safety toolbox talk files in busybusy. These can be easily accessed and reviewed by everyone, helping them to stay organized and on top of any changes that occur throughout the project.
- Time tracking: busybusy allows contractors to track the time spent on the project, including the time spent on change orders, which can help them accurately estimate the cost and schedule impact of the changes.
- Job Cost tracking: busybusy gives contractors job costing capabilities, including data that can be filtered into multiple categories, which helps them to ensure that the project stays within budget.
In summary, a construction change order is a legal document that outlines changes to a construction project’s scope, cost, or schedule. It must be requested in writing including a detailed description of the change, the reason for the change, and any supporting documentation. It is important for all parties to understand the change order and its impact on the project’s budget and schedule.
