Best Practices for Documenting Change Orders in Construction

In this blog, we will look at how proper documentation ensures transparency, helps manage disputes, and maintains project timelines and budgets.  

Lets look at the best practices for documenting change orders in construction:

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1. Establish Clear Procedures and Protocols

Create a Standardized Process

Develop and implement a standardized change order process that is understood by all project stakeholders. This should include a clear workflow for submitting, reviewing, and approving change orders. Ensure that this process is documented and accessible to everyone involved.

Use Templates and Forms

Utilize standardized forms and templates for change orders. These should capture all necessary details, including the reason for the change, scope of work, cost implications, and schedule impacts. Consistency in documentation helps in maintaining clarity and completeness.

2. Detailed and Accurate Documentation

Include Comprehensive Descriptions

Each change order should include a detailed description of the change. This includes what is being added, removed, or altered, and why the change is necessary. Be specific to avoid any ambiguity.

Attach Supporting Documentation

Attach any relevant supporting documents, such as drawings, sketches, photographs, and reports. These provide context and evidence for the change, helping all parties understand the necessity and impact of the modification.

3. Clear Communication Channels

Maintain Open Lines of Communication

Ensure that there are clear and open lines of communication between all parties involved in the project, including owners, contractors, architects, and engineers. Regular meetings and updates can help in discussing potential changes before they become formal change orders.

Document Conversations and Agreements

Keep a record of all discussions and agreements related to change orders. This includes meeting minutes, emails, and any other form of communication. Having a documented history can be invaluable in resolving disputes and ensuring everyone is on the same page.

4. Timely Submission and Approval

Prompt Submission of Change Orders

Submit change orders as soon as the need for a change is identified. Delays in submission can lead to misunderstandings and project delays. Prompt action helps in managing the project schedule more effectively.

Expedite the Approval Process

Develop a streamlined approval process to ensure change orders are reviewed and approved quickly. Delays in approval can lead to work stoppages and increased costs. Designate a team or individual responsible for expediting this process.

5. Financial and Schedule Impact Analysis

Conduct Cost Assessments

Perform a thorough cost analysis for each change order. This should include direct costs (materials, labor, etc.) and indirect costs (overhead, impact on other work, etc.). Provide a detailed breakdown to ensure transparency.

Evaluate Schedule Implications

Assess the impact of the change order on the project timeline. Identify any potential delays and include mitigation strategies to minimize disruption. Update the project schedule accordingly to reflect these changes.

6. Track and Monitor Change Orders

Maintain a Change Order Log

Keep a comprehensive log of all change orders. This log should include the status of each change order (submitted, approved, in progress, completed), along with relevant details such as costs and schedule impacts. Regularly update and review this log to monitor the project's status.

Use Construction Management Software

Utilize construction management software like SunRay to manage and track change orders. These tools can provide real-time updates, streamline communication, and ensure all documentation is stored in a centralized location.

7. Review and Learn

Conduct Post-Project Reviews

After project completion, review all change orders to identify trends and common issues. This can provide valuable insights for improving future projects.

Key Takeaways

• Use findings from post-project reviews to refine and enhance your change order processes. This helps in reducing the frequency and impact of change orders on future projects.

• By following best practices, construction professionals can ensure that change orders are handled efficiently and transparently, minimizing disruptions and maintaining control over project costs and timelines.

• Proper documentation aids in project management and helps build trust and accountability among all stakeholders.

If you find yourself facing payment delay issues in Florida, don't hesitate to reach out for guidance and support. SunRay can provide valuable assistance and expertise to help you navigate the complexities of construction payment disputes. Call 800-403-7660 today and get paid what you deserve.

Common Questions Contractors Ask

How can post-project reviews improve change order processes?

By using findings from post-project reviews to refine and enhance change order processes, you can reduce the frequency and impact of change orders on future projects

Are there specific regulations in Florida that affect how change orders should be documented?

Yes, Florida has specific regulations and statutes, such as the Florida Building Code and local county requirements, that must be followed when documenting change orders.

How can Florida's weather impact change orders?

Florida's weather, including hurricanes and heavy rainfall, can cause delays and damage that necessitate change orders. Proper documentation should account for weather-related adjustments.

What details should be included in a change order form?

A change order form should include the reason for the change, scope of work, cost implications, and schedule impacts.