Tips on Change Order Management

ParsCo Construction Tips on Change Order Management

Disputes commonly arise with construction contracts, particularly with change orders. If these disputes are not addressed with appropriate management focus, the distractions and economic costs of addressing them can result in significant profit erosion. In an economic environment where profits are already under pressure, change order dispute resolution can take on an even greater importance.

 

A change to a construction contract typically requires agreement among multiple parties, often revolving around the owner, the architect, and the contractor. All parties play important roles, with potential outcomes often at odds with each party’s understanding of the project’s terms as well as the associated economic costs and benefits.

 

An effective change order management process begins with a thorough understanding of the contract’s requirements, including what constitutes a deviation giving rise to a change order and the document flow processes required to be carried out. It is important to appropriately identify the change and the particular relationships to the contract terms; e.g., additional work required, plan deficiencies, changes in specifications, delays in schedules, etc. Make sure there is clear communication among all relevant parties as well as appropriate documentation that details the nature of the change and the associated economic consequences. 

These processes and the steps required to resolve disputes along the way are generally addressed in the construction contract documents. When public projects are involved, it is also necessary to adhere to specific regulatory requirements that can vary by state, locality, and public agency.

 

Most construction projects, no matter how well-planned in advance, will involve some level of change orders. It is in the best interest of all parties involved to come to a successful resolution in an efficient and expeditious manner. Clear and timely communication, combined with management support and focus, are critical to ensuring a successful outcome.

 

COMMON CAUSES FOR CHANGE ORDERS

Causes for a change order can vary from one project to another, but still they are additions that need to be quantified in terms of time and money. Change orders, sometimes are a headache when the complexity and time frame of the requested job are tight. Change order management is another different process than regular contract documents, and most common causes for change orders can lead to legal battles, disputes and arbitration.

·        Drawings Errors and/or Omissions

The most claimed situation for allowing change orders. Inadequate details, misrepresentation o simply avoidance to prepare a complete set of detailed drawings can lead to serious change order requests. Sometimes leaving out details and misrepresenting the exact environment in which the construction will be held at, can also lead to change order claims.

·        Design Changes

Several outer factors can lead us to start a construction project without a complete scope of the project and start the construction without final drawings. This type of error is also common on design-build projects, where the on-going process of design can induce to work stoppage or produce economic impact in the project.

·        Specifications

Sometime the drawing asks for one product but the specs calls for another. This situation is very common on construction projects where the drawings are assigned to different consultants, each one of them acting on their own, without any kind of direction from a team leader. This leaves the contractor with the difficult task of assuming and quoting on one article, but when the installation is going to be made, the owner, requires another article to be installed, instead of the one that you have already quoted.

·        Unforeseen Conditions

How many times do you have to complete a soil boring? Soil problems, in particular, are the most common problems with unforeseen conditions. Soil studies can induce you to expect some condition based on specific testing. This could be wrong. Your assumptions on the soil conditions or any other issue regarding the construction of the project can be different from the actual conditions that you find on the site. Also, if the drawings specify a certain amount of work, when, in fact, the amount of materials is almost double, and then a change order must be issued.

·        Substitutions

This is normally a contractor’s idea to substitute material, when he cannot get the specified materials or there is a shortage in supplies. This is kind of different because it can lead to another issue: a credit will be asked if the material cost is less, or sometimes the contractor will have to absorb the costs’ difference between materials and/or products. Sometimes, the Owner also asks for some upgrades during the construction process, in this case you must submit a change order request claiming the economic and time costs associated with the proposed modifications.

 

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ParsCo, LLC

P.O. Box 12862

Pensacola, FL 32591

O:  850.696.7656

Visit us on the web at www.parscoconstruction.com

 

Luxury Walk-In Closets by ParsCo Construction

One of the most important features to a home that is often overlooked is the walk-in closet. ParsCo Interior Designers take extreme care in making sure every detail on a new luxury home is addressed, especially the walk-in closet.

It is where you typically start your day and this makes a fabulous design all the more important.

The use of space is critical. You want a space that functions, offers storage based on your clothing, and has flair that matches your taste.

Some people prefer a minimalistic design whereas others want a fancy decorative design. ParsCo Interior Designers take your taste and make it a reality. Regardless of what it looks like, the designs are functional and meet your needs.

Contact ParsCo at 850-696-7656 or email us at info@parscoconstruction.com for more info.

Creative home design features with ParsCo Construction

Creative designs and implementation of customer requests are some of ParsCo's favorite things about making a project a reality.

Take for instance this gorgeous master bathroom. A fireplace with a bathtub or a bathtub with a fireplace?

Contact ParsCo to make your next creative dream a reality at 850-696-7656 or email us at info@parscoconstruction.com.  

Elements of Design by ParsCo Construction

Elements of Design with ParsCo Construction

It’s no secret that when ParsCo Construction designs a space many factors come into play. Some of the biggest factors that come into the process are the elements of design. If you do your research on aspects and elements of design, you will know that six significant elements of design are outlined and strongly emphasized. However, just to give you a better idea of what all goes into the intricate process of designing a new space, we’ve broken down the six elements of design into two parts.

 

The first part of the elements of design with ParsCo Construction:

 

 

Beauty, Form and Rhythm.

§             Beauty: The age-old saying “beauty is in the eye of the beholder” comes to life when ParsCo Construction transforms a mere piece of space into something that truly captures the eye. Many factors go into making a space or area beautiful such as scale and proportion. Paying close attention to detail and keeping functionality in mind, ParsCo Construction is able to expose beauty in just about any project.

§             Form: Being able to create a structure that is not only beautiful but also acts as a functional structure is an important element of design. ParsCo Construction is able to create dramatic and breath-taking structures that also have a high level of functionality.

§             Rhythm: The element of rhythm includes various factors such as repetition and spacing. ParsCo Construction keeps rhythm in mind when working on a project in order to accent and highlight even the smallest of details in a space.

 

The second half of design elements and how ParsCo Construction succeeds at exemplifying them in every project are as follows: 

 

 

Light, Place, and Materials.

 

§             Light: Taking control of light and how it effects spaces is a specialty of ParsCo Construction. Whether it’s daytime or nighttime, light is constantly playing into an area and should be carefully considered when planning out projects. Designing spaces to play up natural light as well as using lighting techniques to highlight your home after the sun goes down are considerations ParsCo Construction always pays attention to.

 

§             Place: Being considerate of the atmosphere surrounding your home or other space should always play a large role in the planning process. While you do want your home or space to be a sort of haven from the rest of the world, you also want it to blend nicely with the environment surrounding it. ParsCo Construction pays close attention to the exterior as well as the interior of a home or space to ensure that it all comes together as one whole piece.

 

§             Materials: Last, but certainly not least, are the materials. The idea of materials should not be thought of in a construction sort of way, but more as a vehicle in which beauty, form, light, rhythm and place are all delivered through.

 

Rest assured that when you work with ParsCo Construction, all of the important aspects of design will not only put taken into consideration, but will shine through in your final project. Contact ParsCo Construction today to learn more about beginning a new project.

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ParsCo, LLC

P.O. Box 12862

Pensacola, FL 32591

O:  850.696.7656

F:   850.390.4943

Visit us on the web at www.parscoconstruction.com

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ParsCo Varco Pruden Pre-Engineered Metal Buildings Benefits

ParsCo's & Varco Pruden Pre-Engineered Metal Buildings Achieve Your Construction Goals At Lower Cost

ParsCo Pre-Engineered Metal Building Systems can meet or exceed the functional requirements for your facility at significantly lower cost when compared to traditional construction. When selecting a building system, it is important to carefully consider these and many other factors:

• Initial cost
• Schedule
• Life-cycle cost
• Maintenance costs
• Aesthetics
• Structural requirements
• Flexibility
• Availability
• More…

Our dedicated ParsCo Team can guide you through the process of selecting the system that is right for your application.

The Advantages of ParsCo's Varco Pruden Pre-Engineered Metal Buildings

In addition to significantly lower cost, the proper use of ParsCo and Varco Pruden Pre-Engineered Metal Building Systems provides a host of other advantages when compared to conventional construction, including:

• Faster delivery & installation – shorter overall project schedule
• Enhanced quality – reduced maintenance (especially for roofing)
• Flexibility in design – building systems are customized for your specific application

Experience & Expertise You Can Count On

The ParsCo Team has decades of experience with both metal and concrete building systems. The group focuses exclusively on the proper integration of these systems into all of our construction projects.

ParsCo is an Authorized VP Builder and has constructed metal building single projects as large as 225,000 SF. We've managed the design and construction of more than $500 million in construction dollars over the past fifteen years. 

ParsCo Construction

Office: 850.696.7656

Fax: 850.390.4943

Visit us on the web at www.parscoconstruction.com

Check out our blog at parscoblog.blogspot.com

ParsCo's Design/Build Delivery Method

One of the most important items that Owner's neglect to consider when starting a new project is what type of "delivery method" is best.  This is a unique question and depending on the project and the circumstances, the answer may be different. An increasingly popular method that ParsCo has used on numerous occasions is the "Design Build" delivery method.  The hallmark of a design/build project is where a single firm is responsible for both design and construction of a project. The design/builder contracts directly with the subcontractors and is fully responsible for the delivery of the project.

ParsCo's typical design/build approach is to have the owner select a design/builder/ CM working on a professional fee basis who can implement many of the advantages of construction management along with design/build such as:

• Early project cost guarantee
• Open book exposure of subcontractor costs
• Optimal scope change advocacy on behalf of the owner
• Shared savings with a guaranteed maximum price option

This eliminates any concern that the owner may have with splitting contract responsibilities, by creating CM/builder and designer with capabilities tailored to the project. Design/build is best suited for clients who want the simplicity of a single source or have new or renovation projects that are highly schedule driven so it can most readily fast-track if required.

 

 

 

Primary Benefits of Design/Build:

• Single point of responsibility for design and construction
• Fastest schedule delivery
• Early identification of guaranteed cost

Some of the other positive advantages of the 'design and build' procurement approach are:

• speed of delivery from concept to completed building. There is normally a much quicker delivery time than for traditional procurement. In its simplest form, design and build allows work on site to begin earlier (that is before the design is fully complete) than under traditional forms of contract, because of the level of design control given to the contractor. Normally, the design and build procurement approach allows programmes and budgets to be more easily met and the speed of construction is also often quicker;
• single point responsibility. The contractor is responsible for the design and the construction. Therefore the client should have a single point of responsibility and liability against the contractor. This is more advantageous than the traditional forms of contract where the client has entered into separate construction and design agreements. A common problem with the latter approach being that if a claim is made, the contractor, architect or other design consultants may argue over the extent of their own individual responsibilities. Consequently, there is less likelihood of claims being made by the contractor in respect of the split responsibility of design, and the contractor will be unable to make a claim for late design instructions being issued (other than for changes subsequently made by the client);
• acceptance of design. Because the contractor is responsible for the design and the construction, the contractor and his/her supply chain are involved in the production of the design to be used, and hence 'buy in' to that design. Also, it follows that the design is more likely to be 'buildable' than may be the case under other procurement methods;
• novation of design. There is normally the facility for the client's own designers to be novated to the contractor. This approach has several perceived benefits, including; the client may have used those designers many times previously and will be happy with the quality of their work; the design team is likely to be more attuned to the client's requirements; the design team can continue with the contractor where they left off with the client; and some clients believe that through the novation of their own designers they (in effect) have an independent voice in respect of the contractor's subsequent design intentions;
• cost certainty. It is generally the case that, as the contractor can use his experience and expertise in providing a design that allows him to buy goods and services which allows him to obtain the best buying margins, the design and build procurement route can be more cost effective and can provide more cost certainty - provided, of course, that the client does not continually change the brief;
• there is less client management/consultant involvement required post contract, and this therefore results in lower management costs and lower consultants' fees;
• unless a contract states otherwise, the law implies a duty of fitness for purposes on a design and build contractor. This is more onerous than the normal duty of 'reasonable skill and care' imposed on a design consultant. Of course, often the contract does state otherwise, and the contractor's design obligation is limited to a duty of reasonable skill and care. One of the reasons for this is that most professional indemnity insurance policies do not cover for a fitness for purpose obligation.

 

 

 

 

Disadvantages

There are always negatives to any delivery method.  Some of the disadvantages of the 'design and build' procurement approach are as follows:

• the initial price may be higher as the contractor may build into his price a 'risk premium';
• post-contract variations can be more expensive, and it is often more difficult to monitor the additional charges raised (particularly where works are priced on the basis of a specification and drawings - for example);
• the client has less control and influence over design matters;
• inflexibility. There is only limited scope for the client to make changes to his requirements once the client's requirements and contractor's proposals have been agreed otherwise the cost consequences may be prohibitive. If the client does not have a firm and robust set of client's requirements he may be given a design that he did not want, or may be required to pay considerably more to obtain the design that he did require;
• there may be a conflict between the client's requirements and the contractor's proposals unless both documents are carefully checked. This conflict can be obviated by making it clear in the contract which document takes precedence;
• design quality. Because it is often perceived that the contractor is driven by price rather than by design standards, it is often considered that the design and build procurement route is not the appropriate route to use where a high quality design is required, unless a robust specification is included within the client's requirements;
• the question of the quality achieved can be an issue because of the lack of control that the client has over the architect. The architect acts for the contractor not for the client;
• the lack of independence of the architect. If the client wishes to take independent advice on design issues following the building contract being entered into, the client will have to pay additional fees.

 

 

To learn more about Design Build Delivery or how ParsCo Construction can help you select the best way to complete your next project please feel free to contact us!

 

ParsCo Construction

"Serving the entire Gulf Coast Region"

Office: 850.696.7656

 

Visit us on the web at www.parscoconstruction.com

 

Check out our blog at parscoblog.blogspot.com