Change Orders Part 5

March 20, 2003

Schedule and time considerations

Time is a critical factor on virtually all contracts, and most will include specific dates for completion. Many have penalties for time overruns. With this in mind, all changes must be evaluated with respect to the job schedules to determine the total impact on workforce, performance, cost, overhead, and job duration. This will require developing a network schedule for the change order work, and incorporating it into the overall job schedule.

Change order schedule
As part of the evaluation process, a separate schedule for the change order needs to be developed. All normal schedule considerations such as workforce, deliveries, access, and other constraints must be incorporated.

Integration with control schedule
After the change order schedule is completed in detail, it must be incorporated into the overall control schedule. Complete analysis must then be conducted as to the requirements necessary to complete the change work, as well as what impact the change work will have on the original project.

In the absence of obvious schedule impacts, consideration must be given to the ripple effect. This is especially true with a series of small change orders. The effect on schedule is cumulative and some downstream repercussions will occur.

Time extensions
Contracts will vary considerably with regard to time extensions. Some will allow extensions for certain justifiable delays, while others will emphatically state that no extensions are allowed. Regardless of contract stipulations, time extensions are often unavoidable, and it is an absolute necessity for you to address this possibility on every change order considered.

When time extensions can be justified, be firm about the need for them. If in doubt, go ahead and include a request for more time with your change order proposal.

If a time extension is justified, ask for it! It is much better to have to deal with requesting a few days from time to time throughout the job than it is to try to come up with justification for several weeks delay at the end of the job.

Don’t overlook indirect costs where extensions of time are involved. Where specifications do not preclude it, you should attempt to help the owner to recognize that certain fixed costs of plant and equipment are a function of time.

Requirements vary with different contracts. Study and know your particular contract requirements.
For example, in certain government contracts:

1. Time extension without money is granted for:

    a. Excusable delays (strikes, weather, material availability)
    b. Both parties at fault with causative factors unable to be segregated
2. Time extension with costs, but not profit, is granted for suspension of work.

3. Time extension with full cost and profit is granted for:
    a. Changes and extra work
    b. Differing site conditions
    c. Seasonal changes (heat, cold, etc.)
    d. Inefficiency
    e. Sequence changes

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