Jacob Austin** (((00:00:17))) - - Hi all. Jacob Austin here from QS.zone. And welcome to episode 51 of the Subcontractors Blueprint, the show where subcontractors will learn how to ensure profitability, improve cash flow and grow their business. Today's episode, number 51, is about practicalities of managing change during a live construction project. If you're new to the show, please do subscribe for more user friendly advice on all things subcontracting and on with the show. Well, we've all been there. We set out on a new construction project and three days into starting the work on site, we get a major instruction making a major change to work that you should probably be doing straight away. But now you've got to pause and work out what you can do without compromising on quality and losing too much money. Consider what you can actually do that isn't going to need to be immediately broken down and redone. And you're left thinking, if only somebody had mentioned this to you before you started, or if somebody had just told you two weeks ago you could have planned for this, you could have come with different materials, you could have started somewhere else, any number of things and some changes.
Speaker Austin** (((00:01:27))) - - All right. They're not always the end of the world, and they're not always the kind that cause monumental delays. But isn't it always the way that just as you're about to start something in earnest, you get issued with an instruction that rocks the boat, and unforeseen changes are usually the worst. I always think that changes are the best. When you can move two lines on a drawing before anybody starts doing anything, the changes incorporated might cost a bit of money to get the drawings reproduced, but other than that, it's caught so far in advance that everybody else can just crack on as if it was always going to be that way. And this is the thing with changes. Timing is absolutely key. Timing is everything. Timing is the difference between you moving those two lines on the drawing, or you're having to break something down and reconstruct it completely in a completely different place. And that's why it's so important for everybody to engage with the design process at the right point. Because when you're presenting designs to your client, this is the time that they can make minor tweaks, minor changes for next to no cost at all.
Speaker Austin** (((00:02:30))) - - This is the time when their architect might actually just revise the drawing to make it construction stage and pull in. The couple of comments for nothing. Issue out the drawing on the supply chain cracks on with that work. But if you were to start putting in a door opening two weeks before you are handing over a building, or as I remember doing on one of my jobs at the 11th hour, realizing that there was a problem and creating what was, in effect, a chimney breast type construction to house a projector screen because it wouldn't otherwise fit on the wall. There wasn't a big enough flat area for it to fit, and we ended up building out this plasterboard boxing to bring this section of the wall out in line with the steelwork boxing that was up at high level, and this was to incorporate this smart screen that was part of the employer's requirements and throughout the design development. This thing had always been assumed to fit on the wall because there's a whole wall to fit on, but nobody actually got the tape measure out and done a coordination exercise to see whether it did fit.
Speaker Austin** (((00:03:33))) - - And that meant two weeks before handing over the building, after we'd already done the builder's clean for those areas, we were peeling back floor finishes, creating a new plasterboard, boxing, skimming it, decorating it, finishing the floor back around it again and re cleaning that room. And because of the timing of that change, it was a real rush job and it ended up costing us a disproportionate amount of money for what it was. I mean, we literally on one of the same schools we built later did the same thing, and it cost a couple of hundred quid for a couple of studs and the extra reveals, whereas on this job it disrupted so many trades, nearly caused a critical program delay, required a re clean of the errors and rework by five key tradespeople. And this was all for the sake of not picking up a tape measure to check the dimensions. And we could argue that the client hadn't told us where abouts they wanted this screen in the room, but in reality, we hadn't actually created a space big enough to incorporate it anywhere.
Speaker Austin** (((00:04:34))) - - So it wasn't even as if we'd said, right, that's your location. And they said, no, they want it in a different place. They rocked up and said, well, where is it going? Or is it doesn't fit? So when it comes down to assessing a change, timing is often as big a factor as the actual work itself. And bearing in mind the change that I just described, was something that we had to incorporate to pick up a missed employer's requirement. And it's in this kind of scenarios where you can actually lose multiple weeks in a week when you have to pause, have a design knocked up, carry out a few weeks worth of work just to get yourself back to the same position that you were in before. And I suppose I can be glad in this instance that there wasn't anything with any particularly long lead in period associated with that change, because that would have been a real disaster. We're talking of sitting there and realizing that you've got to order something that's on a six week delivery before you can then build it in, which might take another two weeks before you can move on with the work.
Speaker Austin** (((00:05:35))) - - Now, it's not uncommon for when things get constructed like that, for there to be the lead in period beyond the timescale of doing the physical work on site. So knowing and getting to understand the impact of the change is a very real challenge and something that you have to get to grips with quite quickly to know whether you need to submit for an extension of time, or if you're working in New Zealand, to know whether you need to ask for more time as part of your compensation event. And remember that the impact could be in the form of time or cost or quality. It's at this point before you've actually got on with that work and implemented the change that you should be discussing. If you have any ideas for alternatives, sometimes instructions are dished out because a problem is seen with how the works are unfolding. I don't know, maybe a room can't be used for its original intention and something needs to be changed. Maybe a more powerful piece of plant is required. There's 1,000,001 reasons for making a change.
Speaker Austin** (((00:06:36))) - - But sometimes what actually gets asked for and specified by the designer or by the end user is just what they think the answer might be. And you as the subcontractor, with your experience of multiple jobs, of doing the same thing, you often have that slightly more pragmatic experience of doing the same or similar things. And using that experience, you might have come across different styles of the same kind of product. You might know of things that perform in a similar way, but are available for a lesser cost, or there are available more readily. So you're not sat there waiting for large lead in periods to elapse, because you can say, okay, yeah, we can do this. But if you consider using this product instead, then we can go and pick that up tomorrow and we can crack on with the install. Or if you really need the specified product, it's going to take an extra 2 to 3 weeks. Now, having those kind of constructive conversations can save a hell of a lot of cost and a hell of a lot of heartache if they're done at the right time, is, of course, no good to anybody.
Speaker Austin** (((00:07:39))) - - If in hindsight you say, oh well, you should have just done this because blah blah blah. Now it's worth considering that sometimes there is an additional value to things that can be done simply or more quickly, so you might be able to pitch something to say, I can get this done so that it doesn't cost you any delay, but it will be a little bit more expensive and pitch your ideas. And this is a sort of a different value proposition to just the pure cost of doing something, because there's a value in being able to finish something quicker and to be able to finish something with less disruption to the project, less opening up works, less different trades disrupted and having to come back and do something extra. If you can minimize these kind of things, particularly if you can minimize time, and that's going to prevent an extension of time from the contractor or from the client, and potentially prevent lads from being deducted. Then you're definitely onto a winner, and the definitely should be some recognition that you're able to achieve a solution here.
Speaker Austin** (((00:08:45))) - - That's going to save time. Now this is a little bit more of an abstract area, and some contractors will want to drill into that if they don't feel like they're getting value for money. And perhaps part of your justification ought to be program based, so that you're showing exactly what impact the change is going to have if it just unfolds as per the instruction. But by you using your sort of ingenuity or your experience, you're able to put forward something that saves time as an alternative and therefore the overall saving is the prelim saved, the management time saved, the delay cost done away with. And so by comparison, you're actually saving money by charging more. But this is an easily more tangible saving then that saving that your wife tells you that you can have by buying X and Y in the sale, when really you could just save more money by not buying whatever it is. Anyway, this is something that you need to do because of a client instruction, and you're trying to save the wider job the money by putting forward the best idea for it.
Speaker Austin** (((00:09:50))) - - Now, a point on changes and that a lot of the time the focus is on the physical costs of doing one sort of unit of a piece of work. So you might have X per square meter of this item and what that is compared to the original cost of doing a different piece of work that has now been omitted and the change added back. So let's say you are providing so many linear meters of a particular kind of petition, and now that's been omitted, and you've got a slightly different partition with two layers of an acoustic board on there. Now all of the focus tends to be on how and why that is costing more. You've gone from one board each side of the wall to two boards each side of the wall, and you've gone from a basic spec of board to a thicker and more expensive and higher performing board. But if there are large quantities of a change like this, then what you have to keep in mind is what that's going to do to your labor force and the resource that you need to carry out the same operation, but with the increased spec, because in terms of a square meter of cost or a linear meter of cost, if within that it's taking half the man time again to apply the second board to each side of that wall.
Speaker Austin** (((00:11:06))) - - Then you've got to remember that in two days time, you're going to have spent a whole extra man day getting the same length of petition installed. Now, when you're looking at a job and you're resourcing it and you're saying, oh, I need 14 men for the duration of this job, when you're picking up a change like this one, which is incorporating similar but different work, and that work is more labor intensive, then you need to remember that your resources need to shift in line with the changes, and that's something that can be quite easily overlooked because, all right, the number of petitions hasn't changed. Or rather, the length of those petitions hasn't changed. But the comparative output is so much worse and it's so much more labor intensive. So after looking at a particular change, you need to re-evaluate your resource to make sure that you can get to the end of the job in the same amount of time, or at the very least, you need to have that conversation with the contractor to say, look, this is what the impact of this is going to be in unit terms.
Speaker Austin** (((00:12:05))) - - And over the course of two weeks, I'm either going to get less work done because this new system takes longer, or I'm going to have to increase my labor service on site if we need to keep to the same program outputs. And that frank discussion on it might make the difference between you spending more money on resource, or you carrying on with the resource that you've got. Perhaps if the petitions have now been changed aren't as critical to the program. And this is why communication about changes and what they mean to the project are really critical to everybody. Because until you've sat down and discussed what the impact of them actually is, then you could just be guessing at what the contractor wants to get out of it. You could be building something up into a bigger problem than it is. Or of course, you could be right on the money, and you might then need to draft a notice off the back of it to make sure that you protect your interests and you protect your business, getting your hands on that extension of time you need because of the instruction.
Speaker Austin** (((00:13:05))) - - Sometimes when there is a big change, that change can mean different things to different contractors on the same job, and sometimes a change that impacts somebody else and requires extra work by somebody else can also impact you, meaning that you might not get access to certain areas in the same amount of time you'd previously been told. And sometimes changing those parameters can have a real big effect on your ability to complete your work to your program. And this is where the awareness of what's going on, on the job is absolutely vital, because you may be sat in project meetings thinking, this is all well and good, but none of it's hurting me, or none of these instructions are changing my package. And it's not until you get to sight and see the effects of the instructions that you realize that it's putting you in a pinch. Suddenly, if the electrical man has got twice as much lighting to do in each room, then you as the flooring man, following up behind him as having your program time squished. Then you might find yourself with less time in each area, meaning you need more manpower to get the same amount of work done in the same time.
Speaker Austin** (((00:14:11))) - - Or you might find yourself with all of your program dates slipping to accommodate that change. So you just need to be mindful that things can impact other trades, or be instructions and changes to other trades that might have a subtle program effect to you that you need to be prepared for. And a final thought on construction changes is that sometimes these things can be absolute blockers to the momentum that you need to progress on site, and particularly when they are unforeseen knock ons, or there's clusters of instructions that happen at once that caused delay to various different areas. These can sometimes be the most frustrating kind of changes, because you can lose a disproportionately large amount of time doing small things if there are a lot of them, and at the end of the day, nobody wins if things happen late. It's either you that it's costing more money to be there on site, or the contractor who's having to soak up the cost of extra prelims because he's overrunning, or the client that's having to pay the contractors and your extra bill to be there longer, or any one of these things.
Speaker Austin** (((00:15:18))) - - It might even be the end user who's not got the use of the building when they thought they would, and they're having to prolong a lease on something else. Maintaining momentum, maintaining morale, maintaining good communication and a proactive approach go a long way towards avoiding issues when changes come about and finishing on time against all odds. Because you've worked together as a collective, that is one of the most rewarding and satisfying things about construction work, and one of the key things that can lead to you getting that reputation of delivering and the all important repeat business that, in the long run, can be so much more profitable. Now, in today's episode, I've spoken a little bit more about some of the softer things that can come up as part of administering change, as opposed to the contractual approach that you might take as a subcontractor. And these things are equally as important to get right. But let me know what you think about today's episode. My mission is to help the million SME contractors working out there in our industry.
Speaker Austin** (((00:16:20))) - - If you've taken some value away from today's episode, I'd love it if you'd share that value and pass the show on to somebody else who would benefit from hearing it. And of course, subscribe yourself if you haven't already. And thanks for tuning in. If you like what you've heard and you want to learn more, please do find us at WWW.QS.Zone where you can subscribe to our training and support system for like minded subcontractors. In there you'll find templates, how to videos, interviews, and more. It's less than the price of a cup of coffee per day, and you can cancel any time. We're also on all your favourite socials at @QS.zone. Thanks again! I've been Jacob Austin and you've been awesome.
