Making Change Management Simple

Managing a construction project is like navigating a road trip with detours, bad weather, and a destination that changes mid-route. You know the direction you need to go, but constant changes must be addressed.

When you are on the job site, you may feel like you are the sole navigator, dealing with the roadblocks and new requests from the general contractor (GC) as they come up. But this is usually not the case. You have project team members to support your efforts. Open communication with your project team is critical, so when you do need to pivot, you can make an informed decision that lets you remain in control of your project.

Clinical research done by MCA, Inc. indicates that a typical construction project will see 30% change orders. Gaps in visibility depend on your level in the company and your ability to anticipate change orders.

Managing money, manpower, and material can be challenging when it comes to change orders. Some may be fairly obvious, depending on who you are, where you’re working, and how they’re communicated. The link between work and money is not always connected and easily managed. While you may know it’s different “work,” are you able to bill for it? Conversely, sometimes there are change orders that you have funds for that may not match the work that needs to be done.

Visibility of change orders

If you’re on the money side, when do you find out? You might be the last to know. It depends on your internal processes for managing change orders. It could be:

• When an input change is pending (i.e., the project team has sent it out for a quote).
• When it’s approved (i.e., when the customer sends the official change order back).
• When the job has unusual behavior (typically a fade), which prompts the team to think through whether they should put in change orders to cover the fading material or labor estimate.

If you’re a project manager or work in the office, you may hear about change orders in a few different ways and usually when your GC/customer needs something officially.

• Receiving a proposed change order (PCO) — customer/external request.
• Other communications, such as a verbal request, RFI, construction bulletin, or supplemental instructions. 
• Weekly job review meetings.

In the field, your foremen/lead may see or hear based on impacts and fast items that they’re adapting to at the job site, such as:

• Revision of a print or answer to an RFI.
• Customer is talking with them (e.g., GC, owner’s rep).
• Project manager talking to field lead throughout the week (phone call, text, email), letting them know what they’re hearing.
• Weekly job review meetings — when you see that there is a productivity loss that can’t be explained within the current work scope.
• Updating observed percent complete, and realizing there is missing work, or extra work not in the original plan.
• Other trades (hear of a change that was sent to someone else, but you haven’t gotten it yet, or they’re back in a place that you thought was done).

These change orders can be the most difficult to capture in the office as the field teams are making many decisions each day to keep the jobs moving forward, and, in many cases, the office has no idea, according to Dr. Heather Moore's 2013 dissertation, "Exploring Information Generation and Propagation from the Point of Installation on Construction Jobsites: An SNA/ABM Hybrid Approach." Tack on those things that happen that you may not connect to an official change order. Sometimes it’s the things you DON’T see that you’d like to know about in advance and get documented. Key areas of scope creep or change orders needed include:

• Trade stacking — leading to delays.
• Schedule impacts — requiring work changes.
• Temporary power — adjustments not in the initial scope.
• Out-of-sequence work (less effective manpower plan, working over finishes, etc.).
• Multiple passes (go-backs) for a variety of reasons.
• Changes to job-site logistics (parking, lay-down, lifts, etc.).

We hear of the changes, but what can we do about them?

The key is to get things out of your head and into an easily accessible single point of entry log. Thinking about change orders as a change in money and scope that you let the field know is coming is different than thinking about changes in work that need to be followed up with money for the defined scope. Two-way communication is key.