Getting paid properly and on time for your ‘extra work’ on a construction project can–and should–be a simple process. Unfortunately, sometimes clients can get in the way. Worse… sometimes processes and documentation create bottlenecks and YOU get in your OWN way.
Honest talk for a moment. No one loves processes and documentation, but it is required per construction contracts. With that in mind, there are tools to make the process of documenting questions and change orders on construction jobs easier and more efficient.
Trak Changes, the modern solution to change orders, helps eliminate bottlenecks by making the change order process simple and efficient. Along with using Trak Changes, following these 7 steps will help improve your change order management system.
Checklist of 7 Steps to Better Change Order Management
Get Legally-Binding Approval for All Change Orders
We’ve covered this in detail already in our post on the importance of written change orders, but let’s repeat it here, because it is your key to succeeding when it comes to managing construction changes. Let’s put it this way: If it’s important enough to you that you want to get paid for it, it’s up to you to keep the paper trail to show in case there is ever a dispute.
Keep Track of Communication & Documentation
Don’t let a missed email or phone call delay a project. Ensure your change order management process has efficient tools for communication. Ditch complicated spreadsheets, email and phone tag, and utilize a modern change order management platform like Trak Changes to house all the required documentation and approvals to make the change order process efficient.
Implement a Transparent System
The great thing about using a digital process to keep track of issues and changes is that it becomes very ‘transparent’. How? At every progress meeting or meeting with the homeowner you should be reviewing status on all issues, so everybody knows. Everybody sees. Ultimate transparency.
You Are In Charge of Each Change Order
If you have a project assistant or project engineer, that person can help to follow up. If not—it’s up to you! Follow each change until it is complete. Make it a part of your weekly progress meeting.
Utilize a System to Easily Outline Costs
Every change order request you create that is seeking extra money should have backup information showing breakdowns of crew and equipment and materials costs, plus your markups, per contract. For example, instead of just telling your client that the repair work is going to cost $1,400.00, it would be received much better if you explained it this way:
Total Change Order Request
2 Carpenters @ 35.00/hr x 16 hrs
4 ea 2x4x8’ DF lumber @ $16.00 (del’d)
OH & P @ 15%
A breakdown as to labor, materials & tools or equipment is much more transparent and believable. Giving a detailed breakdown will go a long way toward approval of your requested change order.
Review Contract, Plans & Specifications During Bid Process and Again Prior to Starting Work
Early in the bidding process itself,, and you discover something not clearly indicated on the plans, you can submit a ‘pre-bid RFI’. If it is ignored, it will be very helpful in the COR process!
Example: Your bid is for carpentry repair work only, per plans and specs. While inspecting the jobsite for the bid, you notice that the work area is damp, and you send a pre-bid RFI stating that “The work area appears to be damp. Will this remediation be handled by another trade?” However, the RFI was not responded to. Today, you have been awarded the job, so you send out a new RFI, addressing the same problem. The nice thing here is that, since the client never addressed the issue in your pre-bid RFI, you are free to assume that it is not a part of your scope of work, so it simplifies the matter of asking for a change order to handle the work.
All contract docs can and should be reviewed prior to job start for possible issues and changes, as well as for suggesting ‘value engineering’, which will save your client money and ensure you get paid for your time and resources. So, if you know of a different or better or more efficient way to do something than how it is drawn on the plans, in many instances, 50% of the cost savings goes to the contractor making the suggestion.
Understand the Impact and Value of Change Orders
The change order process can make all the difference in the profitability level of your company—including whether you make or lose money on any job. Implementing change orders efficiently can make change orders a profitable piece of your business compared to being a liability.
Having the Correct Tools for the Job
As a master of your trade, you could “make do” with generic tools to get a job done. You have that skill, but you’ve also learned that there are special techniques which most laborers do not have, nor do they know how to do them. But you do! You’re the expert, and you always insist upon using the correct tool for the job.
In your business, there are a number of “work-around” ways you could use to handle all of the changes required in order to make the plans work. You could send an email, or use a spreadsheet, write a letter, make a phone call, write a note on the back of an envelope.
Over the years, contractors have painfully used all of the above. But that was then. This is now. Trak Changes is a modern and simple to use platform to manage change orders for your construction business. From managing the documentation process to approvals to clear and professional communication with your clients, Trak Changes provides you with the tools to manage the change order process.
Simple, transparent pricing
Just like our product, our pricing is straightforward.
One price. Pay monthly. Cancel anytime.
No long contracts, no nickel and diming.
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