November 4, 2013
By: Gray Slocum
It’s not too late to check out the October 2013 issue of Modern Contractor Magazine for Interface Consulting vice president and principal consultant Chris Sullivan’s article, “Death, Taxes… and Changes.” In the article, he summarizes the importance an effective change management process, provides insight into potential issues, and recommends ways to maximize your ability to successfully manage a project through changes.
According to the article, an effective change management process includes the following five (5) key steps:
Identification of a change is often the hardest part of change management, as some changes may initially be subtle in nature. A change can be defined as any anticipated or actual deviation from the contract basis, scope of work, cost, or schedule. All key project team members should be familiar with the contract scope, estimate basis, and schedule in order to enable them to more quickly identify variances from the contract basis.
Most contracts have change notice provisions that require a contractor to provide notice to the owner of potential changes within a fixed period of time. Construction disputes often result from a failure to provide timely and written notice of a change. Timely notice enables the owner the opportunity to review and analyze the potential impact of a change before deciding whether to implement the change.
The next step is to document the change and its impacts. Furthermore, confirm in writing all relevant oral directives and changes.
4. CHANGE ORDER PREPARATION
The change order proposal and estimate should be prepared as soon as possible, keeping in mind any contractual time limits. The estimate should be based on the best available data using the contractual unit rates and mark-ups or other contract requirements, where applicable.
Parties are encouraged to settle changes as quickly as possible, as changes made earlier typically result in less rework and allow more time for efficient planning and scheduling, hence minimizing project cost. A properly documented and prepared change order proposal stands a much higher chance of resolution when it is based on contemporaneous data and factual information.
Remember, change is inevitable on construction projects, but it’s how changes are managed that determines project success. For the complete article, please visit the following link to our website: http://www.interface-consulting.com/articles/death-taxesand-changes/