A change order is work that is added to or deleted from the original scope of work of a contract, however, depending on the magnitude of the Change, it may or may not alter the original contract amount and/or completion date.A change order may fork a new project to handle significant changes to the current project.
Change orders are common to most projects, and very common with large projects. After the original scope (or contract) is formed, complete with the total price to be paid and the specific work to be completed, a client may decide that the original plans do not best represent his or her definition for the finished project. Accordingly, the client will suggest an alternate approach.
Common causes for change orders to be created are:
- The project's work was incorrectly estimated
- The customer or project team discovers obstacles or possible efficiencies that require them to deviate from the original plan
- The customer or project team are inefficient or incapable of completing their required deliverables within budget, and additional money, time, or resources must be added to the project
- During the course of the project, additional features or options are perceived and requested.
- If the contractor has to add work items to the original scope of work at a later time in order to achieve the customer's demands, a fair price for the work items and fees must be added for the materials and labor.
- Extreme weather conditions cause delays or require additional work to complete construction.
A project manager then typically generates a change order that describes the new work to be done (or not done in some cases), and the price to be paid for this new work. Once this change order is submitted and approved it generally serves to alter the original contract such that the change order now becomes part of the contract.
- Harold Kerzner. 2003. Project Management: A Systems Approach to Planning, Scheduling, and Controlling. John Wiley & Sons, Hoboken, New Jersey.
- Eric Verzuh. 1999. The Fast Forward MBA in Project Management. John Wiley & Sons, Hoboken, New Jersey. , 
- Todd Dawalt. 2013. 7 Keys To Dealing With Change Orders. 
|This business term article is a stub. You can help Wikipedia by expanding it.|