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Clive Shearer
Management
by Design
By Clive Shearer

August 9, 2000

Don't let project changes get you off track

By CLIVE SHEARER
Special to the Journal

Most service organizations do a superb job when everything is going well. However, when changes happen and things start getting off track, these organizations may perform poorly or even fail miserably. These failures occur at opposite ends of the spectrum. One group implements corrective action poorly, so their clients become unhappy. The other group does an excellent job implementing corrective action and changes, but they never get paid for their extra work and so profit goes down. Consider the following seven points:

1. Start off right.

Prior to commencing a project, start with identified thresholds so that both you and your client clearly know what will trigger a scope change. Then the project can proceed within a known and agreed upon structure. Doing this tends to hold down change orders because the limits do not need to be tested, and any changes that do occur are usually necessary and not challenged.

2. Know the four types of change.

One type of change is a change in personnel. Another is a change in conditions. A third is a change in scope. Finally, there is a change in timing, either in schedule milestones or in schedule sequencing. All four of these must be anticipated with planned thresholds, or problems may still surface.

3. Be patient.

Clients almost always want you to start work on the change immediately. This is dangerous. Try to resist until the impact of the change is clearly understood and agreed to. And make sure that these understandings are put in writing and signed off by the client. Pay particular attention to the title of the person who signs off on the change. A job site superintendent may not have the authority to approve a change and you may do the work and not be paid because your claim is denied. Remember that once you have delivered your work, your leverage in negotiations falls close to zero.

4. Reconsider innovation.

Innovation can be professionally rewarding. If you are innovative and thereby get more done in less time, you reap the rewards of your innovation. On the other hand, if your innovation rewards the client, do not expect to be paid more just because you saved money for the client. True, this can help you in your efforts to get more work on their next job-but do not count upon it. Being innovative also puts you at some risk. Your risk something going wrong and the client's attorney claiming that you did not follow generally accepted standards of care.

5. Pay attention to accounting.

It is important to track the costs of change orders separately. This is important for your own records, and for invoices to clients. Many companies apply a separate job number for change orders, yet staff may not be clear what to charge under which number. This requires an adjustment to your tracking system.

6. Don't count on help government.

Contract Officers, no matter how friendly, are not there to help you make money. Nor are they there to deny you money. They are there simply to enforce the procedures and rules. They may not fully understand the contract small print, nor all of the legal loopholes, so do not expect them to point out all of your options in any particular case. This also applies to interpretations of government language. You might want to get another opinion in case of a disagreement. Again, put all understandings in writing. If you proceed with changes before a change order is settled, get your expectations down on paper and get concurrence from the government.

7. Keep the client in the loop.

A common failing is to proceed with a change for private or public clients without informing the client of the ripple effects. You do not have to wait until you know every last detail of the change impact, but record what you know, and what you believe will occur as a result of the change. Note in clear and unambiguous language that this is a "preliminary assessment," with an update to follow.


Clive Shearer is a professional trainer, educator and retreat facilitator and can be reached at cgb9@yahoo.com


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