A change order form is a project management document that records contract or project scope changes. It is essential for any contract project because it outlines any changes to the original agreement, including the scope of the working document, timeline, and budget. This ensures that both parties are on the same page regarding the changes and can help prevent misunderstandings or disputes.
Writing a change order form provides several benefits, including documenting changes, managing risks, and avoiding disputes. How do you write one, and how do you use one? Let us here at Indy help you with that. Let's get into better detail about how to write a change order form.
Step 1: Identify the Need for a Change Order
Change is an inevitable aspect of any project, and while it is essential to work towards maintaining consistency, it is also possible that modifications to the project's scope or requirements will be required at some point. When there is a change, a change order must be created so that the alterations may be documented and to guarantee that both parties are in agreement. Changes to the project's scope, specifications, or requirements; unanticipated conditions or circumstances that impact the project; errors or omissions in the original contract or plans; requests for additional work or modifications may all necessitate the issuance of a change order.
The introduction of new information, the establishment of new requirements by stakeholders, or a shift in the objectives of the business could result in modifications to the project's scope, specifications, or requirements. This is especially true for undertakings that will take a long time. In situations like these, it is necessary to analyze how the proposed modification would influence the project's timeline, budget, quality, and safety level. As part of this process, confer with relevant stakeholders to understand the implications of the proposed changes and identify any risks that are connected with them.
During the project, unforeseen events or circumstances may also develop, such as discovering unexpected site conditions, changes in legislation or policies, or inaccessible essential resources. In situations like these, it is essential to examine the change's influence on the project and establish whether or not it would necessitate the addition of more resources, time, or funds.
A change order may also be required if the original contract or plans contain inaccuracies or omissions. For instance, the initial plan or construction contracts should have accounted for a specific amount of labor required to bring the project to fruition. If this is the case, a change order could be necessary to include these new tasks in the project's scope.
If requests for extra work or modifications are made, a change order may also be necessary. Requests like this can originate from either the client or the contractor, and they can be about alterations to the project's design, materials, or specifications. Determining whether or not a change order is necessary involves a comprehensive analysis of the impact the proposed modification would have on the project. Both sides may ensure they are on the same page and that the project is on pace to fulfill its goals if the adjustments are documented through a change order.
Step 2: Prepare a Change Order Form
A change order form is an essential tool for managing changes in a project and ensuring that the freelancer, contractor, and client are on the same page regarding any modifications. How do you prepare one, and what information will be on a change order form? Let's get to it.
What information should a change order form include?
A change order form should include the following information:
- Name and contact details of the client and contractor: This information is essential for identifying the parties involved in the project and ensuring that the change order is properly documented and communicated to the right people. It's important to include accurate and up-to-date contact details to facilitate communication throughout the change order process.
- Date and number of the change order: This information helps to track and organize the change order within the project. Once completed, a unique identifier (such as a sequential number) should be assigned to each change.
- Description and reason for the change: The description should clearly explain the nature of the change, while the reason should provide context for why the change is necessary. This ensures everyone knows exactly what the change entails and why it's being made.
- The effect of the change on the project scope, schedule, cost, and quality: This is the most critical part of a change order form. The effect of the change on the project must be thoroughly evaluated, including how it impacts the scope of work, schedule, budget, and quality. This evaluation should be comprehensive and include all possible impacts, even if they are uncertain. This information will help the client and contractor decide whether to proceed with the change and, if so, how to manage its impact on the project.
- Signatures and approvals of both parties: Once all the information above has been documented, the client and contractor must sign the change order form to indicate their agreement to the changes and commitment to follow through with the revised project plan. This signature also acknowledges the impact of the change on the project's scope, schedule, cost, and quality. It is critical to obtain signatures from both parties to ensure that the change is formally authorized and documented.
By including these details in a change order form, the client and contractor can effectively manage project changes, minimize risk, and ensure everyone is on the same page.
It is important to be as specific as possible when describing the change and its effect on the project. The change order should include associated costs, timeline adjustments, and other relevant information.
Examples of change order forms
Many templates are available for change order forms, but choosing one appropriate for the specific project and industry is important. Here are some examples of free change order template forms that can be used or adapted for different types of projects:
Construction Change Order Form
This form is designed specifically for construction projects and includes sections for the contractor or construction company's details, the client's details, a description of the change, the reason for the changes, and its effect on the project's budget and schedule.
Software Development Change Order Form
This form is designed for software development projects and includes sections for the client's details, the vendor's details, a description of the change, the reason for the project changes, and its effect on the project's timeline and cost.
Manufacturing Change Order Form
This form is designed for manufacturing projects and includes sections for the client's details, the supplier's details, a description of the change, the reason for the change, and the effect on the project owner's production schedule and cost.
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Step 3: Negotiate and Agree on the Change Order
Once a proposed change order has been evaluated and its impact on the project's scope, schedule, cost, and quality has been assessed, the next step in the approval process is to negotiate and agree on the change with the other party. This can sometimes be challenging, especially if the parties have different perspectives or priorities.
Below are some tips and best practices for communicating, negotiating, and agreeing on a change order fairly.
Be clear and specific about the change and its implications
It is essential to communicate clearly and specifically about the proposed change and its impact on the project. The change order should clearly outline what changes, why, and the expected outcome. Both parties should know how the change will impact the project's budget, schedule, quality, and other relevant factors.
Provide evidence or justification for the change
Providing evidence or justification for the proposed change to the other party is important. This can include documentation, data, or other relevant information supporting the change's need. This will help to build credibility and trust with the other party and increase the likelihood of reaching a mutually beneficial agreement.
Consider alternative solutions or compromises
It is only sometimes possible to fully agree on a change that meets both parties' expectations. In such cases, it is crucial to consider alternative solutions or compromises that may be acceptable to both parties. Brainstorming together and exploring different options can help find a solution agreeable to both parties.
Document and confirm the agreement in writing
Once an agreement has been reached, it is important to document and confirm it in writing. A change order form should be updated to reflect the changes agreed upon and signed by both parties. This ensures that everyone clearly understands what has been agreed upon and there is clarity and understanding in the future.
Negotiating and agreeing on a change order is an important aspect of managing any project involving contracts. Both parties can reach a fair and mutually beneficial agreement by being clear and specific about the change, providing evidence or justification, considering alternative solutions or compromises, and documenting and confirming the agreement in writing. Effective communication and collaboration between the parties can lead to successful outcomes for all involved.
Step 4: Implement and Monitor the Change Order
Once the change order has been negotiated and agreed upon, it is time to execute and manage it according to the agreed terms and conditions. This section will discuss implementing and monitoring the change order effectively to ensure its success.
Execute and manage the change order according to the agreed terms and conditions
The first step in implementing and monitoring the change order is to execute and manage it according to the agreed terms and conditions. This means ensuring that all necessary resources, including personnel, equipment, materials, and funding, are allocated to the project to complete the change order successfully. It is essential to ensure that everyone involved in the project knows the change order and their roles and responsibilities.
This is a process that can be streamlined by using a project management tool like Indy. Its all-in-one approach means that once the change order form is approved, all you need is to add it to your scope of work document, and you can keep track of it.
Use tools for tracking and reporting on progress and performance
Several tools and methods are available for tracking and reporting on the progress and performance of the change order. For example:
- Project management software or app: A project management tool like Indy can help track the change order status and ensure all necessary tasks are completed on time. Indy also has the tools to manage resources, budget, and communicate directly with your client.
- Updating the project schedule and budget: The project schedule and budget should be updated to reflect the impact of the change order. This will help ensure the project remains on track and within budget. Indy allows you to do this quite easily with its invoicing tool.
- Tracking additional time: Indy's time tracking tool allows you to add any extra time needed for the change. This ensures you, as a freelancer, will retain all billable time.
Monitor and report on the progress and performance of the change order
Monitoring and reporting on the progress and performance of the change order is essential to ensure its success. This involves regularly reviewing the project schedule, budget, and quality to ensure the project progresses as planned. It is also important to track and report any issues or risks arising during the project and take corrective action as necessary.
Implementing and monitoring a change order is a critical aspect of project management. The project can be completed successfully by executing and managing the change order according to the agreed terms and conditions, using tools and methods to track and report on progress and performance, and monitoring and reporting regularly. Effective communication and collaboration between parties will help ensure the construction change order process's success.
How Indy Can Help with Change Order Forms
Indy's Forms tool is an excellent solution for freelancers who need to create and manage change order forms during projects. Change order forms are crucial for documenting and tracking alterations to a project's scope, budget, or timeline. With Indy's intuitive form builder, freelancers can easily design customized change order forms, using available templates or starting from scratch.
The platform enables users to embed or share these forms with clients, ensuring a seamless and organized communication process. By utilizing Indy's Forms tool, freelancers can efficiently manage changes and modifications to their projects while maintaining a professional appearance.
- Invoicing: Indy's invoicing tool is designed to make it simple for freelancers to create, send, and track invoices. Users can create professional invoices in minutes, automate reminders for overdue payments, and accept various payment methods. This feature helps freelancers maintain healthy cash flow and reduce the stress of managing their finances.
- Contracts: The contracts tool streamlines the entire contract process for freelancers, from drafting to signing. Users can choose from a range of customizable templates, add their terms and conditions, and send the contracts for electronic signature. By using Indy's contract tool, freelancers can protect their interests and maintain a professional relationship with clients.
- Proposals: Crafting persuasive proposals is essential for winning new clients, and Indy's proposal tool makes it easy. Freelancers can create visually appealing proposals using templates or by starting from scratch. The tool also allows users to track proposal views and receive notifications when a client has opened the proposal, enabling freelancers to follow up promptly and increase their chances of success.
Indy is a highly recommended platform for freelancers, offering a comprehensive set of tools that cater to their unique needs. With its ease of use, affordability, and centralization of essential tools, Indy empowers freelancers to manage their projects more efficiently and grow their businesses. By choosing Indy, freelancers can confidently navigate the challenges of running a successful freelance business, knowing they have the right tools and resources at their fingertips.
Change Orders in Construction Projects
Change orders are common in construction projects, as unexpected issues or changes in project scope may arise during the construction process. A change order is a document that outlines the changes to the original scope of work and can be initiated by either the owner or the contractor. Change orders typically include information such as the reason for the change, the cost and time impact, and any other necessary modifications to the project plan.
Managing change orders effectively is crucial for the success of any construction project, as they can significantly impact the project timeline and budget. Please properly manage change orders to avoid delays, cost overruns, and disputes between the owner and contractor.
To ensure effective management of change orders, it is important to establish clear procedures and communication protocols for initiating, reviewing, and approving change orders. This includes identifying the appropriate personnel responsible for reviewing and approving change orders and establishing a clear process for tracking and documenting changes. Also, it is essential to regularly monitor and update the project schedule and budget to account for any changes resulting from change orders.
The following section will provide a template for a change order document based on a fictional mine construction job site to demonstrate how change orders can be effectively managed and documented in practice.
Change Order Form Template for a Construction Project or Construction Contract
Project Name: [Insert project name]
Change Order No.: [Insert unique identifier, such as a sequential number]
Date: [Insert date of change order]
Requested By: [Insert name and contact details of the party requesting change]
Approved By: [Insert name and contact details of party approving change]
Scope of Change: [Describe the nature of the change and how it impacts the project]
Reason for Change: [Explain why the change is necessary, such as unforeseen site conditions or client request]
Estimated Cost Impact: [Provide an estimate of the cost impact of the change]
Estimated Schedule Impact: [Provide an estimate of the schedule impact of the change]
Revised Contract Amount: [If applicable, provide the revised contract amount]
Revised Contract Time: [If applicable, provide the revised contract time]
Additional Details: [Include any additional details, such as potential risks and mitigation strategies]
By signing here, the parties acknowledge and agree to the above change:
Client Signature: ____________________________ Date: __________
Contractor Signature: _________________________ Date: __________
A template like this ensures that all necessary information is included and that both parties agree. It is important to carefully evaluate any proposed changes and thoroughly document them in a change order form to avoid misunderstandings or disputes later.
To summarize, a change order form is indispensable to every contract-based undertaking. It details any changes made to the original agreement, including the document outlining the scope of work, the timetable, and the budget. This ensures that all parties understand the changes and can prevent misunderstandings or disagreements. A change order form contributes various positive aspects to project management, including the documentation of modifications, the management of risks, and the prevention of disputes.
The best practices to reduce the number of change orders required for future projects include meticulously planning and defining the project scope, completely examining and confirming the contract and plans and predicting and minimizing any potential risks and concerns. If you do all these, you won’t have to create a change order form as your original scope of work won’t require changing.