Change orders are pretty much a “necessary evil” in most construction projects. Whether they’re related to design modifications or unforeseen conditions, change orders are a natural part of the construction process.
There have to be limits, however. If not managed properly, change orders can derail your project by inflating costs, messing up timelines and budgets and disrupting your relationships with the owner, investor and other stakeholders. They can even compromise the quality of your work, which can later lead to litigation.
What can you do to put the brakes on unreasonable amounts of change orders? Consider these tips.
Detail the scope of work carefully
The more detailed your initial contract, the smaller the potential for misunderstandings. Make sure that you include notes on the materials, methods, timelines, boundaries and exclusions. Having your client articulate exactly what they want from the start gives you the ability to make sure that you’re both on the same page from the start.
Have a formal change order process
You don’t want to guess whether a text from your client is a change order or just musings. That’s why you should have a formal process in place. When change orders and your responses are carefully documented in writing, you have proof that the client understands the associated costs and any adjustments that have to be made to the timeline.
Consider a contingency plan
You may want to consider building contingency plans into both the budget and schedule, where the client is agreeable. A little room in the budget for such things can make it much easier to make timely adjustments to the project if certain materials need to be swapped out, and a fluid timeline that allows for potential delays can also help manage expectations.
Ultimately, change orders still have the potential to create a lot of confusion. Sometimes, those hard feelings evolve into legal disputes. If that happens, make sure that you have solid legal guidance about your options and the strength of your position.