Construction Change Orders: Maximizing your Opportunities and Profits

Why write a book dedicated to the construction management topic of change orders? We all want to make a profit, that is why we are in the construction business. This is one of the riskiest financial endeavors anyone can take on and the failure rate is extremely high compared to other industries. I have received countless requests from general contractors and subcontractors to advise how they can preserve what fee they bid and possibly improve upon it. The best way to improve profits is to beat the estimate and schedule. Change orders are also opportunities to improve the fee, but only if managed properly. There is no guarantee of fee enhancement, in fact many contractors will say they lose money on change orders. The best chance for fee improvement is by effective construction processes, which includes change order management, as is discussed throughout this book.

I have written several construction management books. In just about every title, change orders are discussed, as they play an important role in our industry. But my approach in those other books has always been change order mitigation and management, not short-term profit maximation. In this book we will deviate from that approach a bit and seek opportunities for maximizing project and corporate profits through construction change order processing. The premise for this book is that successful negotiation of change issues is as important to a contractor as achieving its estimate and schedule goals, building with quality, and maintaining a safe working environment.

The book covers several topics essential to change order management including strategies with the initial estimate, finding opportunities during construction, contract procedures, initiating proposals, pricing, negotiations, incorporation into the contract, payment, impacts, claims, dispute resolution, subcontract back charges, and additional profit opportunities.