Subscribe
Watching how change orders flow is one of the simplest ways to determine the adequacy of relationships and the project management system being used. The degree of realism present can also be assessed.
Why Change?
Over the years, PMI® has shown in the Guide to the Project Management Body of Knowledge® more and more acceptance of the need to address change as the project progresses. Why? Stakeholders rarely understand everything needed to address their needs. Frequently, they don’t have a clear set of needs or have a poor understanding of their situation and go looking for something that isn’t going to be all that valuable in the end. On top of this, the vendor does not always know what they will run into and has to shift their approach accordingly. Consequently, change orders are a “must” for almost all projects.
Shall We Dance?
Up front, the vendor and client will do best defining the change order process. The choreography is laid out ahead of time. You can imagine, then, what it must look like if there is no change order methodology in place and the need for a change surfaces. Imagine a couple on the dance floor, everyone watching, the lights focused on them. Also imagine no dance step has been chosen and the orchestra is waiting for the music.
Just like good dancers, three major considerations will drive the client-vendor relationship when it comes to planning and performance:
- Appropriate principles and approach
- Organization
- Discipline
Appropriate principles and approach. Each dance has a context, a history, and framework from which it flows and which also provides meaning. It can vary dramatically from dance to dance. Think of Flamenco and then compare it to Thai classic dance.
The same is true for project contracts. Is it design-build, time and materials, fixed fee, etc.? The framework for the dance (project plan/execution) is defined based on the contract. In turn, the boundaries for the change order process are also defined, e.g., the vendor will have to absorb any change orders associated with their own design flaws if the contract is fixed fee.
The vendor COULD ask the client to absorb the cost and go outside the established framework but this could get very confusing and prove to be impractical. Imagine dancers switching from Flamenco to Thai classic dance in the middle of the performance.
Organization. The contract selects what dance will be performed. The choreography puts detailed structure to the dance. Think network diagram and RACI charts.
Discipline. Now comes an even harder part – practice, practice, practice. Just like a dance pair, stakeholders from both sides of the contract must commit and engage at a very detailed level if the performance is going to be smooth and appear effortless.
The Importance of Change Orders: Performance not Perfection
For the uninitiated one might think a strong enough focus on principles, organization, and discipline would be sufficient. Rarely is that the case. Regardless of the level of detail and planning brought to a situation there always is some variance in performance present. This is where change orders come into play and why they are so important. Imagine one dancer leaping and being caught by the other. The ability to gauge and adjust to shifts in centers of gravity is extremely important. One or both dancers could be hurt seriously if that ability were missing.
Change orders provide flexibility to keep performance successful.
You can see how this makes sense when in the framework of principles, organization, and discipline. If no dance has been chosen, the dancers have yet to meet and the musicians have yet to work together let alone have no idea of what they are going to play – no amount of wiggle room to make it up as they go will help.
It is dangerous to believe enough change orders will compensate for vague contracting, lack of planning, and little or no discipline.
In other words, the more time spent defining the product along with relationships and mapping these into the appropriate contract format the better. It supports clear, frank discussions as to what the best change order process is and inclusion of such in the contract language
—