Amerimix
BMJ Stone
Echelon Masonry
EZG Manufacturing
Federated Insurance
Fraco USA, Inc.
Hohmann and Barnard, Inc.
Hydro Mobile, Inc.
iQ Power Tools
Kennison Forest Products, Inc.
Mortar Net Solutions
Non-Stop Scaffolding
Pullman Ermator
SPEC MIX LLC
Stabila
Tradesmen's Software, Inc.
November 15, 2005 7:59 AM CST

Silence is Not Golden It's Deadly for Your Change Orders

By

Listen up team: You really need to pay attention to this one. Some people won't, and it will cost them and their companies tens of thousands of dollars. As contractors, and as full contact project managers, we have one of the best jobs in the world. We get paid for what we used to do for fun as kids ? build stuff!

Life is sweet, work is satisfying, and sometimes we don't want it to stop. At least, that's how we pursue our projects. Get 'em started. Get some momentum going. Get finished. Get paid.

Ah, if only every project were simple, the plans were always correct, and the clients or the architects never changed their minds! But if I were in the room with you right now, here is what I'd do: I'd blow my whistle and bring us all back to reality. Why? Because building stuff isn't just about building stuff. In almost every instance, it's also about managing change.

If you can't manage change, you can't be a builder (at least not for very long). Changes are inevitable. More importantly, changes represent potential revenue for the contractor who recognizes them and knows what to do with them.

Let me tell you a story.

Your company is working on a job site and your foreperson calls. She says, "Such and such just happened. I don't think it's in our contract to do this, is it?" You smile because you have been working with all of your forepersons, training them to recognize potential changes and to call you before they do anything.

As a good full contact PM, you whip out a "winning" RFI and send it to the construction manager. You let the CM know that "such and such" is impacting your work and that it has potential time and money consequences. The impact is that you need to immediately put one extra person on this task.

You call the CM. Yup, he got your RFI, all right. He sees your point. He acknowledges that this task is requiring an extra man and that it is not normal to your operation. He's going to be taking it to the owner of the project.

You tell your foreperson to keep track of your crew's time and you have them get back to work. You also bring in an extra crewmember for the next two days. Because you build stuff, you want to keep the momentum going, and you don't want to stop.

WHISTLE! FOUL! PENALTY! YELLOW CARD! YOU'RE OUT!

What you have just done has been repeated by almost every reader of this magazine. (In fact, e-mail me if you have never had this happen to you ? bet you that I don't get many!) Here is the major transgression you have just committed: you have lost your leverage.

Lost leverage? In sports, it's all about leverage, whether it's pinning someone on the mat, making a block or taking a big swing at the ball. Leverage makes it work. Likewise, in the construction industry, managing change is also about leverage. Leverage for the PM is huge. When your team identifies a changed condition, your obligation is simply to inform your CM or your client. Your obligation, at this point, is not to fix the condition. If it's out of your scope of work then it's not your job ? literally.

As contractors and subcontractors, we often find ourselves with little leverage. However, at the point of informing your CM about the change, you are at maximum leverage. Do not forget this. At this instant in time, you stand your best opportunity for fair compensation. As you proceed past this point, you begin to lose leverage, and it falls off quickly.

Why? Because there is really only one thing that the CM wants from us, and it is not our friendship. The CM wants his job done now. And it is the wise PM who recognizes this, and asks his CM in the RFI, "How do you want us to proceed?"

But the PM needs to be willing to stand his or her ground. At the very least, even if the CM disagrees that the work is not in your scope, the CM is obligated to direct you, in writing, to proceed.

And here's what it comes down to, team. Wouldn't you rather know today whether or not the CM is going to pay you? Aren't you tired of wishing and hoping that your change order request is approved? And that's precisely why you can't be silent on these issues. Because being silent can set you up for the downfall. And then life would no longer be so sweet, right?


About the Author

Gary Micheloni is a working project manager, speaker, author, consultant and coach. He has severals years of industry experience, including a background as a licensed general engineering contractor. For further information and insight on the Full Contact Project Management approach, write Coach Gary at FullContactTeam@gmail.com.

Copyright © 2005, Gary Micheloni and Full Contact Project Management

 

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