Change Orders In Construction: What You Need To Know

Construction projects are like puzzles, and just when you think you’ve got all the pieces in place, someone flips the table. 

Who knows, the client wants something out of the blue in the middle of the construction process.

That’s where change orders in construction​ come to the rescue. The unsung hero of keeping your project on track.

But the question is, “What is the change order in construction?”  Well, it’s all about making formal modifications to the original project scope.

Why does this happen? Well, there are plenty of reasons we’ll discuss in our guide below.

Whatever the case, change orders are here to make sure these surprises don’t turn your project into chaos.

But how do you handle these curveballs without losing your mind or your deadlines? That’s where the solid procedure of Clue comes into play.

In this guide, we’ll break down everything you need to know about change order construction and show you how to handle them with confidence, keeping your project running like a well-oiled machine.

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What is the change order in construction?

Well, the answer is right there in the name “a change to the original order." ‍

It can be a change in construction inventory, designs, timelines, or budgets.

It’s like swapping puzzle pieces mid-game and hoping they still fit together seamlessly.

Thus, a proper construction change order is required with clear documentation to discuss and approve the new order among the stakeholders, architects, and project supervisors to ensure they don’t derail the project’s progress.

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Components of Change Orders in Construction

Let’s get to know the different types of change orders in construction that play an important role in effective project management.

These include:

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1. Design Changes

Sometimes the architect walks onto the site, takes a long look, and says, "This just won’t work."

Or maybe the client suddenly wants something out of context that didn’t exist in the original plan. 

Instead of letting the chaos take over, a real-time collaboration can be your best friend.

It’lln ensure everyone from project managers to workers are on the same page.

Because the only thing worse than a design change is a design change no one knows about.

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2. Additive Changes

These involve adding new work or features to the original contract.

For example, the client wants a bigger lobby or upgraded equipment to their liking.

These changes can increase the budget and timeline, but they also raise the overall value of the project. 

It’s not just about adding more, it’s about ensuring these enhancements align flawlessly with the project's premium standards.

You need to make sure clear communication and careful planning so that the new additions fit seamlessly into the big picture. 

Leveraging automated resource allocation and job site detection help you redistribute resources efficiently.

You can maintain cost control, keeping the project on budget without compromising on quality.

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3. Deductive Changes

Sometimes, less is more. Deductive change orders let you scale back by removing unimportant features.

These changes reduce both the cost and the scope, but don’t mistake “less” for “less effort.”

It’s about streamlining, redistributing resources, and making sure the remaining pieces still align with the project’s flow.

With careful adjusting of the contract value and some strategic resource management, you can keep things on track without losing momentum.

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4. Schedule Changes

You can’t control nature, so sometimes delays are caused by weather.

And sometimes, a crucial equipment dispatch gets delayed, or unforeseen complications arise.

So, don’t let these roadblocks throw you off course.

Instead of playing catch-up, you can stay ahead with real-time trackers that identify bottlenecks early and adjust schedules dynamically.

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5. Client-Initiated Changes

A client's sudden decision to swap or change layouts mid-project can be frustrating.

But, by keeping tabs on equipment and resources in real-time, you can ensure smooth adjustments without missing deadlines.

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6. Cost Changes

Another reason, change orders in construction spark when budget overruns.

This can arise from equipment price hikes, labour shortages, or additional work requirements. 

But there is a solution to control the cost changes by implementing robust cost-tracking systems and maintaining transparent communication with softwares.

Then you can manage these financial surprises effectively, ensuring the project remains financially viable.

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7. Lump Sum Changes

Instead of juggling costs and hours, you can opt for a lump sum change order.

It’s like hitting the reset button with a clear, fixed price for the extra work. 

No need to guess, just one number to cover the adjustments. This approach keeps everything clean and straightforward.

It’s a smooth way to add scope without the headache of endless calculations, and it makes sure everyone from the client to the contractor knows exactly where they stand.

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What are the common reasons for change orders in construction?

There are several factors that contribute to change orders in construction, and each presents its own challenges, let’s take a look:

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1. Incomplete or Inaccurate Initial Plans

Missing or incorrect details in initial designs, like the location of a hidden utility line, are among the leading causes of change orders in construction.

These errors not only delay projects but can significantly increase costs. 

• Establishing detailed initial plans

• Reviewing designs collaboratively can minimize risks. 

Leveraging tools that analyze project data for inconsistencies can save you from headaches later.

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2. Regulatory Changes

If there’s one constant in construction, it’s change, especially when it comes to building codes.

Updated building codes or compliance requirements can derail your project. 

You have to stay informed about regulatory updates using ERP systems that ensure your compliance data is always on point. 

Also, integrate them into your workflows because no one likes finding out halfway through a project that you’re out of sync with the latest regulations.

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3. Unforeseen Site Conditions

Ever dug into a site and discovered a surprise—maybe a hidden utility line or a soil issue that wasn’t in the original plans? It happens.

The key is to expect the unexpected. Preparing for these surprises with detailed planning is important. 

While you can’t predict every surprise, using real-time equipment tracking ensures you’re ready to adapt.

Makes site-specific challenges easier to tackle and reduces downtime caused by unexpected conditions.

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4. Client Requests

Clients can be unpredictable! One moment they’re all about minimalism; the next, they want a rooftop infinity pool.

The trick is keeping communication crystal clear and managing changes efficiently. 

Use tools that centralize workflows to manage client communications and offer a transparent and efficient workflow for approvals and adjustments.

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5. Equipment Shortages or Cost Fluctuations

Supply chain issues and fluctuating equipment costs can cause delays and budget overruns.

To address this, we recommend using technology to optimize resource allocation.

Maximizing inventory management can save the day as it empowers construction teams to maximize available resources, minimizing the impact of equipment shortages and keeping timelines intact.

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What is the process of change in order in construction?

The construction site can be unpredictable; you don’t know when and where a problem might arise.

By coming up with change orders, the authoritative group can come up with better transformations rather than wasting time and risking the project.

Here’s a step-by-step breakdown of the change order process in construction and how it works:

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1. Rapid Identification

The first step is recognizing the need for a change.

This could result from site conditions like hidden utilities, shifting client preferences, or updated regulatory requirements. 

Timing is everything here. The sooner you flag a change, the smoother it is to assess its impact and plan accordingly.

With automated alerts and real-time issue detection, your team can stay ahead of potential disruptions and address them proactively.

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2. Proper Documentation

After identifying the need for a change, preparing detailed change orders in construction documentation is the next prompt step.

This includes outlining the scope of the change, estimating the cost implications, and determining how it might affect the project timeline. 

Customized service checklists or frameworks make this process easier.

It provides a framework for documenting every detail; for example, construction report & analytics software, ensures no critical information is overlooked.

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3. Cost Estimation & Resource Evaluation

After documenting the change, you need to estimate the cost and evaluate resource needs.

This includes the whole cost of labour, inventory, and equipment. That may be required for the new scope of work.

By estimating the cost, i t will help you prevent misunderstandings later and thus ensure that the project remains on budget.

You can utilize cost estimation software for the construction sector to calculate and track actual costs.

To make future financial adjustments easier.

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4. Approval From Stakeholders

Once the documentation is ready, it’s time to secure approvals from stakeholders.

This means presenting the details, addressing questions, and ensuring everyone’s on the same page. 

You need to be clear and transparent in your communication at this point.

Using tools with role-based access simplifies the process, enabling stakeholders to review and approve changes efficiently while fostering trust and collaboration. 

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5. Precise Implementation

The final step is implementing the change.

This involves updating project plans, reallocating resources, and closely monitoring the process to ensure the change is executed without further issues. 

The importance of a coordinated approach during implementation avoids additional delays.

Provide live updates, keeping all team members informed and aligned as the change is carried out.

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6. Monitoring & Adjustments

Even after the construction change order is implemented, the job isn’t done yet! It’s important to keep a close eye on the project's progress to ensure that the changes are being implemented efficiently. 

This is where progress tracking and project management tools come in handy.

These tools help assess how the change is impacting the project’s schedule, costs, and quality standards. 

You’ll want a team that’s ready to make real-time adjustments to resources, labor allocation, or timelines if things shift.

Quick responses can prevent small hiccups from snowballing into bigger issues down the line.

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7. Final Verification/Closure

Once the change order is fully implemented and the project is running on the right track, a final verification should take place. 

This will make sure that the change has been carried out as planned.

A formal closeout includes reviewing the work as part of the change order and obtaining final approvals from all stakeholders.

This provides a clear sign-off on the modification and closes the loop on the change order. 

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What should construction change order include?

A Change Order in construction serves as a formal amendment to the original contract.

Basically capturing any agreed-upon changes between the Owner, Contractor, and Architect.

Think of it as the paperwork that keeps everyone on the same page when things need to shift. 

A well-designed Construction Change Order Template lays out all the necessary details, offering clarity and avoiding potential disputes down the road.

If the contract doesn’t have a specific template, the contractor can craft one—just as long as it covers all the essential info.

Here’s what you need to include in your Change Order Form:

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1. Project Information

Start by clearly listing all basic details about the project to establish its connection to the original contract.

This section should include:

• Project Name and Address

• Contract Number and the original Contract Start Date

• Owner’s Name and Address

• Architect’s Name and Address

• Contractor’s Name and Address

• Change Order specifics, such as the Change Order Number and the date it was issued

Including these details ensures the construction change order is easily linked to the specific Scope of Work (SOW), particularly for Large Commercial or Government Projects, where documentation accuracy is critical.

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2. Details of the Changes to the Contract

This section outlines the proposed changes to the original contract in comprehensive detail.

Be as specific as possible and include:

• A clear Description of the Changes

• Supporting materials like photos, drawings, or documents that explain the reasons for the change

• Itemized details of the required adjustments

Providing precise descriptions and attaching relevant evidence ensures that all stakeholders fully understand the nature and necessity of the changes.

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3. Cost and Schedule Adjustments

This is where the financial and timeline impacts of the Change Order are documented.

Include the following:

• Original Contract Sum or Guaranteed Maximum Price (GMP)

• Net Changes from previously authorized Change Orders (if any)

• Contract Sum Prior to This Change Order (the total of the original amount and previous net changes)

• Adjustment for Current Change Order, showing how the Contract Sum will increase, decrease, or remain unchanged

• Revised Contract Sum after incorporating the current change

• Schedule adjustments, including (whether the Contract Time will increase, decrease, or remain unchanged. The revised Substantial Completion Date, calculated by adding or subtracting the days affected by the change.

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4. Signatures

A Change Order construction is not valid until signed by the key stakeholders:

• Architect

• Owner

• Contractor

• Project Manager

These signatures signify that all parties agree to the terms, including the revised Contract Sum and Contract Time.

Without these validations, the Change Order cannot be executed.

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How to avoid change orders in construction?

Avoiding change orders in construction is like trying to keep a project on track when the unexpected seems to pop up at every corner. 

But if you stay one step ahead with some clever planning, communication, and the right tools, you can significantly reduce the chances of needing those annoying change orders.

Here's how you can handle it like a pro:

• First things first, clear communication is essential. You need to talk regularly with the client about their expectations, timelines, and budgets to prevent confusion down the line. 

• Properly estimating the cost and scope from the beginning of the project can help you avoid issues that might pop up as the project unfolds.

• The more detailed your blueprints and construction drawings designs are, the fewer changes you’ll need to make. 

• Ensure that all parties have signed off on the pre-construction phase to avoid unnecessary surprises later.

• Constantly check progress with real-time productivity tracking and conduct regular site visits to catch any issues early on.

• Use integrated project tools between teams to avoid miscommunication and keep everything aligned.

• If you’ve built a buffer into your budget and timeline, you can manage unforeseen site surprises without needing a change order.

By incorporating these practices, you’ll be able to avoid the majority of change orders in construction.

While it’s impossible to predict every challenge, these steps will help you navigate the unexpected with confidence and keep your project running smoothly from start to finish.

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Role of Project Managers in Change order in construction

Well, managing change orders is not for the faint of heart; as a project manager in the construction industry, you're like the captain of a ship.

When unexpected conditions arise, it's your responsibility to navigate the challenges and keep the project on track.

So, what’s a project manager supposed to do when the client wants a last-minute change, or you’re hit with a material shortage? You guessed it, change orders to the rescue.

But how can you manage the responsibility in the middle of the madness? Here’s the thing: You’ve got to anticipate the changes before they even happen.

Sounds like magic, right? Well, it’s not. 

It’s all about reviewing the scope, equipment, timeline, and site conditions so you can predict the disruptions that might pop up.

The more prepared you are, the less likely you’ll be blindsided by a surprise.

When everything is said and done, the project manager is the one who is responsible for adjusting the schedule and budget to reflect that new scope of work.

If that change means more work or a longer timeline, you’re reallocating resources, tweaking the schedule, and updating the financial plan like a pro. 

The key is tracking everything and ensuring that those changes are fully incorporated into the project. Without causing a chain reaction of new problems. 

Once the dust settles, it’s up to you to make sure everything is completed, approved, and documented.

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Best Practices to Manage Change Orders In Construction

Dealing with change orders in construction doesn’t have to feel like a migraine.

Instead, let’s flip the script with best practices so that you can get a clear picture of what to expect and what to plan early:

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1. Be Flexible

Why wait for the storm when you can pack an umbrella? From day one, be flexible! Create a "change-friendly" project framework into your plans.

Allocate a buffer budget and craft timelines that allow room for adjustments. It’s not just about planning to succeed; it’s about planning to adapt.

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2. Real-Time Updates

Old-school spreadsheets? Toss them. You have to polish your skills on real-time project management tools; it’ll save you time.

These platforms keep everyone on the same page, so any kind of change, big or small, can be noticed promptly among the project members. 

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3. Teamwork Makes the Dream Work

Don’t be the lone wolf. Bring everyone to the table like architects, contractors, clients, even that one guy who always has “a better idea.”

When everyone’s involved in the decision-making process, you’ll avoid drama, confusion, and unnecessary delays.

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4. Lean into AI 

We’re not in the stone age, let artificial intelligence help.

Predictive analytics tools can analyze past projects to identify areas most likely to require changes, giving you a heads-up on potential hiccups. 

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5. Create Your Change Order Book

Every construction pro needs a playbook.

Document your processes, templates, FAQs, and even examples of past success stories.

This not only saves time but also ensures consistency, no matter how many change orders come your way.

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Role of Technology in Handling Change Orders

In 2025, technology isn’t just a luxury, it’s a revolution that’s reshaped the way we do things, especially in construction.

Honestly, if you’re not using it to handle change orders in construction, you’re making life way harder than it needs to be.

Think about it: Change orders are like those last-minute plot twists in a movie.

You’ve got to rewrite the story, adjust the timing, and make sure everyone loves the updated version. But how are you going to achieve a happy end?

That’s where AI Driven construction software - Clue comes and saves you from this miserable state.

With real-time tracking, Clue ensures you and your team are always in the loop. Keeping every change order updated instantly and accurately.

Its centralized communication hub means no more scattered updates, everyone from contractors to architects stays aligned in one place.

Plus, Clue’s intuitive interface makes it incredibly easy to use, so you can focus on the project rather than learning complicated software.

For those who need clarity at a moment’s notice, Clue also offers comprehensive reports that provide both quick snapshots and detailed insights into your projects.

Want to impress clients? Well, that’s only possible with the advanced technology of 3D modelling and virtual reality in the construction sector.

Handle change orders by taking your client on a virtual tour and show them how the new layout will look right there in the room.

And get rid of those old-style tactics where you’re struggling to picture it with bizarre drawings.

Why is using tech in construction change orders such a big deal? Because time is money in construction, and tech helps you save both.

Predictive maintenance flags potential problems before they even happen.

Construction Scheduling lets you reshuffle tasks in minutes, so if one thing gets delayed, the whole project doesn’t grind to a halt.

Honestly, it’s not just about working smarter; it’s about staying competitive.

So why not make life easier? Your team, your clients, and even your bottom line will thank you.

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Conclusion

Construction is all about building something extraordinary, and changing orders in construction is just part of the journey.

They might feel like hurdles, but with the right mindset, tools, and teamwork, they can actually become opportunities to shine.

By following a structured construction change order, from identification to implementation, you can handle these surprises smoothly.

Just be attentive and set a clear communication path between stakeholders, architects, and team members. 

The more you connect with each of them, the more they’ll have a clear vision of what you're expecting from them to achieve. 

So, next time a change order lands on your desk, don’t sweat it.

See it as a chance to showcase your expertise, adapt, and deliver something even better than you imagined.

Because, in construction, just like in life, it’s not about avoiding change, it’s about mastering it.

With the help of tools like Clue, you can navigate these challenges with confidence, ensuring projects stay on track and within your budget. 

Ready to take control of your construction projects?

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FAQ’s

1. Do change orders affect the project cost?

Yes, change orders can increase or decrease the overall project cost. If the changes require additional work, equipment, or time, they will likely result in higher costs. 

2. Can multiple change orders be combined into one?

Yes, multiple small change orders can be combined into a single change order if they are related to the same project or require similar adjustments. 

3. Do change orders apply to all types of construction projects?

Yes, change orders are common in nearly all types of construction projects.

4. How do I track change orders during a project?

Tracking change orders during a project can be done through project management software, spreadsheets, or dedicated change order logs. 

5. How do I determine if a change order is necessary?

Deeply analyze if the change is essential for the project’s progress, whether it’s due to unforeseen issues, client requests, or external factors.

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