Change Order Management

Change is inevitable on construction projects. Managing changes protects your money and schedule.

The golden rule

Price and get the change approved in writing BEFORE you do the work. Doing extra work on a handshake is how contractors lose money.

A change order should capture

• The scope of the change.
• The cost (added or credited).
• The schedule impact (added days).
• Written approval from the owner.

Watch for scope creep

Small "while you're at it" requests add up. Track them, price them, and document them — every change is either a change order or a loss you absorb.

Going Deeper (Intermediate)

A change order (CO) adjusts the contract's price and time for changed work. The discipline: identify the change → give written notice → price it fully → get written approval → then perform. Never do extra work on a handshake.

Track everything on a PCO (potential change order) and CO log so nothing falls through the cracks.

Advanced / Pro-Level

Protecting margin and schedule through changes:

• Constructive changes — when an RFI answer or field directive quietly changes your work without anyone calling it a "change." You may still be owed, but only if you gave timely written notice (mind the contract deadline — miss it and you waive it).
• Pricing: lump-sum vs. time-and-materials (T&M) with agreed rates and the contract's allowed markups; include schedule impact, not just cost.
• Cumulative impact — many small changes can disrupt productivity beyond their individual cost; document it.
• The CO log is a living margin tracker — unapproved-but-performed extras are interest-free loans to the owner you may never collect.

Practice Challenge

Mid-job the owner verbally asks you to upgrade all the fixtures "while you're at it." What do you do before lifting a finger? (Answer: stop and write it up — issue a PCO, price the fixtures + labor + markup + any schedule impact, and get a signed change order; performing on a verbal request is how contractors do free work.)

In Practice

A GC does 'while you're here' extra work with no written change order — and the owner refuses to pay. Price and approve every change before doing it.

Common Mistakes to Avoid

• Doing change work before written approval
• Letting scope creep go untracked
• Not capturing the schedule impact of changes

Takeaway: Price and get written approval for every change BEFORE doing the work — unmanaged changes and scope creep eat your profit.

Educational content — not legal or contractual advice. Follow your contract's specific procedures and deadlines.