Change order

Change orders is a common problem within the construction industry. A change order is a change within the original plan for the project which might cause changes in terms of delaying the project and add to the original budget so the project becomes more expensive than first estimated, it is therefore desirable to reduce the amount of change orders within a project. A change order might occur both in the design and construction phase of a project. A change order can be a change in the placement of pipes and the free height in the building. If there are pipes which are placed at the same place, the free height might not live up to the requirements from the building owner, and therefore there has to be a change in the design. Another change could be that the building owner want to make changes to the design of the building as it did not live up to his or hers expectation. The earlier the change the better as the changes are more easily integrated in the project and therefor it reduces the risk of delays and exceed projects.

There are several ways one might be able to reduce the amount of change orders. For instance BIM and virtual reality will make the building owner able to see the building before it is built and thereby make sure it looks like what he or she wants it to.

Why is change orders a problem

Change orders is a problem as it might up the cost of a project and therefore the budget might exceed what it is suppose to be. It is normal that the cost of change order will be around 10-15% more than if the change has been included in the original bid on the project (indsæt note). Which Changes in the orginal plan might also reduce the overall cost of the project. This can for instance be of there is a change in the materials used in the construction, though changes like this might have to be done before the construction has begun as the contractors have to buy the materials in order to build.

Another problem with change orders is that it might prolong the project as it takes time to make changes in the design of the building especially if the change first is made when construction has started. A change that might occur after the construction phase is stated is fixing already built things, like a damaged installation, which then need to be changed for a new one, which will cost more as there need a new part and then there is the added cost of man hours to remove the old and install the new.There often are a compensation to the contractors if the project is delayed which then again result in a higher cost of the project than firstly estimated.

Confusion within the project and the plan for this can also be a problem in terms of change orders. This will most likely only become a problem if there are a made a lot of changes without good communication to all involved in the project. When this happens more errors might happen and then this result in more changes to the project.

References

• Cooper, A., “Common causes of change orders”, Electrical construction and maintenance, 2015 volume 114, issue 4.
• O'Leary, A., (2009), “Coping With Change Orders. Keeping Confusion Under Control and Limiting Disputes” [ONLINE] available at: http://www.dcd.com/oleary/oleary_ja_2002.html