Training for Handling Change Orders Effectively
The construction industry is one where contractors (and subcontractors) often start small through marketing their new business to family, friends, and acquaintances, promising them good quality and setting terms verbally. Those are usually small projects that are completed smoothly because, even when any modifications are required, they are discussed and executed without conflict. Then the successful small contractor enters the big game, and these small modifications become huge change orders.
Change Orders: A Major Nuisance in Construction
As a construction supervisor, or worker on any other level, you have probably heard about change orders. If that is not the case, you can quite easily determine what a change order is from the paragraph above. They are modifications that a client requests once work has started on their construction project. With contracts that include major construction work, one can imagine any significant modification means considerable addition in the labor, materials, time, and costs to bear all of these additions to the budget (which many clients would not want to approve).
Change orders are nothing but trouble. They make your project timelines go haywire. They demand a lot of resources you did not think would be needed for the project. The client will not be happy about any more money you ask for, although you will be asking a just price for the excess work. Additionally, they might damage your reputation if they find an excuse to leverage it to get you to do the extra they want without paying you.
Understanding the Key Problems (and Solutions)
Now, you might be thinking that sounds like an unreal situation because contractors these days know how to protect their business and draft long construction contracts with clear pricing and scope of work.
You would be right about the latter, but the situations we described above are true in a lot more cases than we know because proper construction change order training and education is not as common as it should be. Many small contractors are still falling into these traps due to the fact that they want to work, complete projects, and make money. However, inconsideration to these possible setbacks can lead to big problems.
What you need is to understand the key problems involved with change orders and how you can protect yourself and your construction business against them. Here’s a short list of them:
- Change orders are in and of themselves not a problem if they are executed with like the rest of the contract. They become a problem only when terms in the contract are not clear and leave room for the client to demand more work without paying the due additional price.
- On the other hand, the contractor could be a cause for change orders if their team is working inefficiently or they discover problems during project execution that lead to modification in the original plan and thus result in a change order.
- Contractors need to give due importance to contract drafting with particular focus on the pricing and scope of work sections.
- With pricing, the best way to go about drafting the section is itemizing the price, breaking down the final price into components with their particular share in the price. This provides transparency and gives the client some idea of what kind of value each aspect of the project has. When a change order is required, these figures can help reach a mutually agreed price for the modifications.
- With scope of work, make sure your contract has no loopholes and use contract writing best practices to deliver a clear promise of deliverables and also draw clear limitations to the project and the work you will be doing. The clearer you are the more easily you can protect yourself from any false claim afterwards.
Our Products to Help You with Construction Change Order Training
The thing with change orders is you cannot avoid them. They are, and will, continue to be a part of construction projects for years to come. The solution to better change order management is adequate construction change order training.
As a growing name is online education for amateur professionals, Lorman Educational Services has developed a number of products and programs for constructions executives, managers, and supervisors. Many of them are related to change orders and you can use them to get highly professional training about managing change orders effectively.
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Get started learning about change orders today. Find a course on this page or start a search in our course catalog by clicking the training link at the top of the page. You can choose to do a course at a time or you can choose to get the All-Access Pass which gives you access to unlimited courses for an entire year. This is by far the best value for your training dollar. Start today!