How can you manage contract changes and variations more effectively?

1 Understand the scope

The first step to managing contract changes and variations is to understand the scope of the original contract and the agreed terms and conditions. This will help you identify what constitutes a change or variation, how it should be communicated, documented, and approved, and what impact it will have on the deliverables, timelines, and budget. You should also review the contract for any clauses that specify how changes and variations should be handled, such as change orders, variation orders, or change management plans.

2 Communicate clearly

The second step to managing contract changes and variations is to communicate clearly and promptly with all the parties involved, especially the client or customer. You should explain the reason, nature, and effect of the proposed change or variation, and seek their input, feedback, and consent. You should also communicate with your internal team, suppliers, and subcontractors, and ensure that they understand the implications and expectations of the change or variation. Communication should be done in writing, using the appropriate forms or methods, and confirmed by both parties.

3 Negotiate fairly

The third step to managing contract changes and variations is to negotiate fairly and collaboratively with the other party. You should aim to reach a mutually beneficial and realistic agreement that reflects the value and risk of the change or variation, and that preserves the relationship and trust between the parties. You should also consider the alternatives, trade-offs, and concessions that can be made to accommodate the change or variation, and avoid any unnecessary or unreasonable demands or conditions.

4 Document everything

The fourth step to managing contract changes and variations is to document everything in a clear, accurate, and consistent manner. You should record the details of the change or variation, such as the description, scope, price, time, quality, and acceptance criteria, and attach any supporting documents, such as drawings, specifications, or calculations. You should also document the approval process, such as the signatures, dates, and references of the parties, and the amendments or addendums to the original contract. Documentation should be stored securely and accessible to all the parties.

5 Monitor and control

The fifth step to managing contract changes and variations is to monitor and control the execution and delivery of the change or variation. You should track the progress, performance, and quality of the work, and report any issues, risks, or deviations to the other party. You should also verify and validate the completion and acceptance of the change or variation, and ensure that it meets the agreed standards and expectations. You should also update the project plan, budget, and schedule accordingly, and reflect any changes or variations in the final invoice and payment.

6 Learn and improve

The sixth and final step to managing contract changes and variations is to learn and improve from the experience. You should evaluate the outcomes, benefits, and challenges of the change or variation, and identify any lessons learned, best practices, or areas for improvement. You should also solicit feedback from the other party, your team, and other stakeholders, and incorporate their suggestions and recommendations into your future contract negotiations and management. Learning and improving from contract changes and variations will help you enhance your skills, reputation, and relationships in the long run.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?