Contractor's Practical Guide To Change Order Pricing and Management

“Change is inevitable,” as the old saying goes. On construction projects, a more appropriate statement might be that “change orders are inevitable.”  Change orders in construction projects are the most significant source of financial increases, disputes, and schedule delays for general contractors, subcontractors, owners, and consultants! 

Are you losing money on changes, your schedule getting out of control, subcontractors not providing pricing on time, and owners not issuing change orders when they should? Are you leaving money on the table and overlooking recoverable change order cost items? The “Contractor’s Practical Guide to Change Order Pricing and Management” workshop will provide the contractor with valuable guidance and working tools for effective change order management to increase the effectiveness in preparing for change orders, simplify the process and boost change order approval rates. This workshop is a comprehensive and practical guide for managing one of the most critical areas of construction contracting: preparing, pricing, gathering, submitting, negotiating, and getting paid for all changes to construction projects. 

Working with the manual, which has over 25 example checklists, forms, and letters, this workshop will guide the contractor through step-by-step procedures, checklists, forms, and letters that combine to create the blueprint for the successful submittal of proposed change order pricing and issuance of change orders. 

Topics will include:

• Understand conditions that create change orders and be prepared for them
• Learn the Request for Information (RFI) process and how to leverage RFI’s for answers and changes
• Understand the Supplemental Instruction (SI) – a no-cost, no-time document and how to manage risk associated with improperly issued SI’s
• Learn about the contractual obligations of the change order process including overhead and profit, valid pricing periods, and more
• Learn the step-by-step change order process including:
  • Creating a master change control log
  • Managing subcontractors' pricing including distributing, managing receipt of, reviewing, and returning pricing for correction
  • Managing and determining all internal company costs, including direct, indirect, and consequential costs
  • Determining schedule impact and additional general conditions costs related to the proposed change, including time impact analysis and creating fragnets
  • Compiling and assembling all proposed change costs including internal, external, and schedule impact costs
  • Learning the value of complete and comprehensive supporting documentation
  • Submitting the proposed change pricing package and the importance of submitting it on time
  • Understand the qualifications to add to proposed change order pricing to protect the contractor regarding the validity of the pricing duration as well as others
  • Managing the consultant and owner review and issuance of the change order
  • Understanding when the contractor needs to raise the flag by issuing first and second notices and then a “Notice of Delay”, if required, to the owner for prompt change order issuance
  • Managing the change orders and issuing subcontractor change orders
• Understand and be prepared for common change order issues
• Learn the risky business of change directives and the importance of submitting daily labour timesheets (example included) and costs
• Learn the importance of issuing “zero dollar” subcontractor change orders to ensure that all subcontractors are working from the most current set of documents.
• Learn about the cumulative impact of changes and how it is the contractor’s responsibility to be able to predict the future impact of current changes

Exclusive to this workshop is a comprehensive manual that is used as a reference and guide throughout the sessions. The manual is based on accumulated knowledge gathered over 40 years in the construction industry. It is a valuable and effective tool that contains not only practical how-to’s, checklists and templates but will also be a foundation for new processes and procedures back in the office or on the job site.

There are no prerequistes to this course.

Owners, senior managers, project managers, project coordinators and supervisors for general contractors and subcontractors who want to learn how to create repeatable and profitable processes for change order management.

1. Computer or laptop

• • This course will involve on-screen interaction with your instructor and classmates, reading/viewing on-screen content (slides or videos), and interacting via typing with questions or responses. For this reason, cellphones may not be adequate. 

  • Windows 10 or Mac iOS. 

2. Webcam (Mandatory)– in order to engage and collaborate, participants will be expected to have their webcams on for the duration of the class

3. Microphone (Mandatory)

4. Internet connection- For best results, you will want to ensure you have an internet connection with an upload/download speed of 3-5 Mbps. You can test your internet speed here. The minimum recommended speed is 1.5 Mbps, but anything below 3 Mbps may result in loss of quality or buffering. Ideally hardwired connection versus wireless for stability - connect your computer directly to your router using an ethernet cable, rather than using your home wi-fi.

5. A quiet space with minimal distractions –The microphone will be engaged for interactive sessions. Please plan to be fully engaged in the class and clear your work schedule just as you would for the in-class program.

6. Comfortable chair

"Everything was new. This was extremely helpful."

"Great course, learned alot and have more to learn as there is so much information."

"It was great, a lot of information. Thankful for the document handouts."