By: Barbara Hunt
According to David Foster, representative of the Canadian Home Builders Association (CHBA), CHBA members cite project changes as their biggest dilemma. When owners, designers, or unforeseen occurrences instigate change during the building process, work scheduling and costing suffer due to the escalating demand for extra equipment, materials, labour or overtime hours. But preparing some realistic solutions to the inevitable change orders that happen on the job will help keep projects on track and within budget.
Renovator Steve Barkhouse, president of Amsted Construction in Ottawa, Ontario takes a proactive approach to his projects by planning ahead. He utilizes pre-construction meetings, thorough forensic inspections and precise paperwork that details the project scope, cost and timeline to keep all parties up-to-date.
But since clients and projects can be unpredictable, it’s critical to identify when and where in the schedule delays can happen, and to communicate accordingly with the client.
"It helps to walk the clients through as many decisions as possible beforehand," says builder/renovator Mike Cochren of Cochren Homes in Oakville, Ontario. He accounts for issues that may arise when making schedules. As a result, in a recent project when his client took seven days to deliberate over granite counter edging, the project’s budget and schedule did not suffer.
Changes due to defective plans and specs, change in scope of a project, differing site conditions, scheduling delays, substitutions or incomplete design all result in increased costs. But any changes that are identified immediately are always much easier to manage.
"Anything can happen when walls are opened up," Cochren says. "It’s our job to control the process and explain everything before or as we do it."
On a recent excavation and concrete project, John Friswell of Canadian Constructors International Ltd. in North Vancouver discovered that fill-removal was creating an extreme overrun on the budget. "The problem was two-fold," he says. "The excavation was deeper than anticipated and the other, more serious issue was that we had not estimated our costs high enough due to changes in scope during the budget stage. Not a fun problem, but it had to be presented to the clients." In the end, the clients agreed to the overage and the problem was deftly resolved.
Barkhouse adds that it is in the best interest of all parties to be upfront about the proposed time and costs associated with any and all solutions to change orders. In many cases, this straightforward approach serves to curtail some frivolous alterations by clients or their architects during construction.
Cochren also presents alternative solutions along with paperwork at weekly meetings with clients. "We cover agenda items from the site and try to push for decisions," he says, especially when there are several options to discuss. "It’s crucial to stay upstream of production."
Friswell notes that alternatives are most often called for in the finishing of a project. However, creative problem solving is necessary at any stage of the process. "We have also come up with structural changes, such as ingenious beam placement, in order to not run supports to a foundation, for example," he says.
Cochren’s open and frequent communication with all relevant parties expedites getting clients, architects, engineers and subcontractors on the same page when problems arise. After all, time is money.
Friswell explains that change orders are laid out in the contract with a copy of a sample change order document, and that orders must be signed by the same people who signed the contract. This contractual arrangement prevents precious time loss during a crisis.
The greatest challenge is to ensure that all work is done properly and coordinated well, even when presented with changes orders. Like most contractors, Friswell attempts to safeguard quality first, then keep
Cochren says keeping trades advised or getting them to spot the job ahead of time allows for a tight response time when changes arise. On a recent $203,000 renovation, total changes resulted in the project only being 4 percent over budget, and the project came in one day early.
According to the National Research Council Canada’s findings, most construction outfits in Canada use software for information recording, document approval, change estimation, impact analysis and to perform post-change analysis.
Friswell regularly maintains a detailed budget and specification document in order to help identify problem areas. "This budget is constantly monitored as we bill—billing every two weeks—so the budget forecast is also updated every two weeks," he says. Once the contract is signed, changes only happen with an approved change order.
And when it comes right down to it, changes happen. "You have to manage. Not shy away from that part of the business," Barkhouse says. "Planning is everything. Managing is the rest."
Clients or projects that are difficult to manage require additional attention. Here are some suggestions on how to best manage them. In order to make clients more comfortable, apply heightened communication levels. Although all vital information between contractor and client should be in writing, stress face-to-face meetings because technology can make it more difficult to establish a good rapport with clients. "Deal with any concerns or changes quickly, professionally and honestly," says Steve Barkhouse of Amsted Construction Multiple solutions to issues give clients choices and a greater sense of control. Like Amsted's policy, try to get prior client approval to deal with any change that is less than $500 immediately rather than impeding workflow for minor occurrences.
Being flexible in any communication helps to build strong relationships with clients by showing interest, appreciation and respect. When issues arise, compromises will be that much easier to achieve.
As Mike Cochren of Cochren Homes says, "business used to be 75 percent technical knowledge and 25 percent business skills. Now it's 80 percent communication and 20 percent technical expertise." Communication from all members of the team and within the team itself keeps the clients in the center of the process in a very collaborative manner.
When issues arise, clearly explain everything in advance and in as much detail as possible in an effort to maintain trust in the relationship.
By creating a knowledge-sharing team culture to improve all relationships through trust, care and openness, not only will the organization be stronger, but the contractor/client relationship will thrive.
Both Mike Cochren and Steve Barkhouse of Amsted Construction stress weekly client meetings and an "open-door" policy that gives clients the opportunity to raise concerns. This markedly increases clients' comfort levels, changes aside.
Incorporate and reinforce these qualities in your organizational image: honesty, sociability, integrity, decision-making ability, reasoning and listening by honing well-rounded communication skills. "Communication alone helps in the times when you may not be keeping up with the information flow and gives the client confidence that they are getting the answers-one way or another," says John Friswell of Canadian Constructors International Ltd.