Changing a Contract
Contracts often need to be changed. To do this excellently requires careful communication and evaluation. Here are the major steps.
PART 1. PROPOSED CHANGE
Most change requests come from the customer. The customer want to change the scope of the project.
Maybe they want to change the features that were already agreed-upon. Let’s say a new house is being built. The customer wants to change the color of the garage door.
Or maybe the customer wants to add altogther new features. To their new house project, they want to add a third floor.
But sometimes the change request is from the contractor.
Maybe the contractor found ways to improve functionality. Or save costs.
Whether the change is from the customer or the contractor, whoever is asking for the change needs to describe it carefully.
Here are three main points to address:
- What is the change?
- Why is the change needed?
- By when is a decision required?
PART 2. SUMMARY OF IMPACT
The proposed change shows up. Now it needs to be reviewed.
In most cases, it will be reviewed by a Project Manager.
The Project Manager is usually the person who is most familiar with the details:
- The scope of the project
- The timeline
- The contractors
- The customer
- The financial situation
When considering the impact of the change, here are the main points to address:
- What is the specific benefit?
- What is the estimated cost?
- What effect will it have on the timeline?
- What new risks does it add?
- Does it require additional Project Management?
- What effect will it have on other projects?
PART 3. DECISION
Having reviewed all the above, the decider needs to make a decision.
In some cases, the decider is the Project Manager.
But in other cases, it is an executive. Or a Board. The members of a Board are sometimes referred to as “stakeholders.”
Here are three most likely decisions:
- The change is accepted, as-is
- The change is altered and then accepted
- The change is rejected
Originally published on March 23, 2019
Last updated on April 28, 2023
TOPICS: Communication, Contracts, Project Management,