Change Order Approval for General Contracting

Obtain your company’s standard approval matrix and review the prime contract for any owner requirements related to change order approvals (for example, client pre-approval over certain amounts). Note any project-specific conditions.

Identify roles involved in change approvals, such as project manager, operations manager, and executive leadership. List typical approval thresholds from company policy (for example, PM up to $25k, Ops up to $100k).

Discuss with operations leadership whether standard thresholds are appropriate for this project’s size, client, and risk profile. Adjust limits if necessary and document any deviations from the standard.

Identify situations where higher-level approval is required regardless of dollar value, such as schedule extensions, changes to warranties, or scope deletions. Add these to the approval rules.

Summarize all thresholds and special triggers in a one-page matrix that shows who must approve what. Use clear ranges and examples to make it easy to understand.

Distribute the matrix to the project team and save it in the project controls folder. Refer to it in change order procedures so everyone follows the same rules.

Open the contract section covering change order procedures, allowable markups, required cost breakdowns, and any special rules (for example, time-and-material rules above a threshold). Keep this open while you review the proposal.

Check that markups on subcontractor work, GC work, and general conditions match the percentages and structure allowed by the contract. Confirm there is no double mark-up on subs.

Verify that the cost breakdown matches any client requirements, such as separating labor, materials, and equipment or grouping by CSI division. Adjust the breakdown if it is too high-level for contractual standards.

Ensure that subcontractor quotes, internal worksheets, and any supplier quotes are attached and clearly labeled. Confirm that all lines in the breakdown have recognizable backup if the client asks.

Confirm that any required preliminary notices or written directives related to the change have been issued and saved. Link the proposal back to those documents in your internal notes.

In the change event register, note that contract compliance was reviewed and identify any minor deviations or open questions that may need to be discussed with the client.

Determine which cost codes and budget lines will be affected by the change. Check whether there are related allowances, contingencies, or owner reserves that apply to this scope.

Look at the original estimate or bid backup for similar work and see whether unit pricing and productivity assumptions line up reasonably with the change pricing. Note any significant differences.

Calculate how the change will affect project contingency and projected profit. Note whether the change increases margin, uses contingency, or introduces risk of overrun in certain areas.

Review the pricing with the estimator (if available) or project manager to get their view on whether it is reasonable. Ask whether scope is fully covered and whether there are opportunities for value engineering.

Based on this review, determine if pricing should be revised prior to internal approval and client submission (for example, adjusting quantities or refining GC general conditions). Document any changes made.

Summarize key financial observations and decisions in the change log entry so there is a record of why the final pricing was accepted internally.

Open the schedule and time impact notes developed during Change Order Pricing. Confirm which activities and milestones were identified as impacted and what time extension, if any, was estimated.

Meet briefly with the superintendent to review how the change will be installed on site. Ask about access, rework, sequencing, and any impact on other trades or ongoing operations.

If the superintendent provides new information, refine the time impact analysis. Adjust the estimated days or weeks, and consider whether the change creates a new critical path or tightens float.

Decide, with the project manager, whether the change should formally include a request for schedule extension or whether the team will handle it through resequencing or overtime without contract time adjustment.

Write a simple summary of schedule impact for this change, including whether you are requesting additional time and how the work will be integrated into the existing plan.

Include this summary in the internal approval package so decision-makers clearly see the time and operational implications of approving the change.

Draft a one-page summary that lists the change ID, title, description, value, schedule impact, main trades affected, and whether you recommend approval. Use bullet points for clarity.

Include the final cost breakdown worksheet or form that shows line items by trade and cost type. Make sure it matches the summary values presented on the cover sheet.

Attach relevant RFIs, bulletins, sketches, subcontractor quotes, and internal cost worksheets that explain how the pricing was assembled. Do not overload the package with unnecessary documents.

Include any time impact analysis, schedule snapshots, or written explanations of schedule effects so reviewers can see the time dimension alongside cost.

Reference any prior notices to the client or written directives that led to this change, either by attaching them or citing their location in the project file structure.

Convert the cover sheet and attachments into a single PDF or neatly organized electronic folder. Name it with the project, change ID, and “Internal Approval” so it is easy to find.

Using the project approval matrix, determine who needs to approve this change based on its dollar amount, schedule impact, and risk (for example, project manager plus operations manager).

Submit the approval package through your company’s workflow tool or via email with a clear subject (for example, “CO-012 Internal Approval Request”) and concise instructions on what you need (approve, comment, or reject).

If the change is time-sensitive or holding up work, clearly state the desired approval deadline and the impact of delay in your message to approvers.

As approvers review, answer any questions they have about scope, cost, or schedule. If questions reveal a gap in the package, update the documents and resend as needed.

Once approvals are granted, capture them via electronic signatures, approval stamps, or saved email responses. Note any conditions or comments that accompany approvals.

Change the status of the change in the register to “Internally Approved” and record the date and names of approvers. This creates a clear record of internal sign-off.

Determine whether the client requires their own change order form or will accept your company’s standard form. Retrieve the latest version to avoid using outdated formats.

Fill out the client form with the agreed description, cost summary, and any required breakdown. Ensure that line items and totals match your internal numbers exactly.

Draft a short, non-technical description of the change that explains what is being added or modified and why. Avoid internal jargon and focus on how the change affects the finished project.

If there is a time adjustment, clearly state the number of days or the new milestone date you are requesting. Reference any attached schedule explanation.

Include a level of backup appropriate to the client’s expectations—enough to support the price without overwhelming them. Typically this includes subcontractor quotes, key drawings, and a high-level cost breakdown.

Before sending, double-check that all documents in the client package tell the same story: scope, value, and time all align, and no numbers conflict between forms or attachments.

Decide whether the change will be discussed in a dedicated meeting or during a standing project meeting. Ensure the right client decision-makers are invited or informed.

Start the discussion by explaining what the change is and why it is needed before diving into dollars. Use the clear scope narrative and any visuals (for example, marked-up drawings) to support understanding.

Present the overall value and major cost components (for example, main trades and GC costs) without overwhelming the client with every detail. Offer to walk through the detailed breakdown if they want more information.

Explain any requested time extension and how you plan to manage the change operationally. If you have taken steps to mitigate delay, describe them to show you are being responsible.

Allow the client to ask questions or challenge elements of the change. Answer calmly and factually, referencing backup and contract provisions where helpful.

If the client requests adjustments, negotiate within the parameters agreed internally (for example, small scope tweaks, minor concessions). For major changes to price or time, pause and seek internal guidance before committing.

If pricing, scope, or time were modified during discussion, revise the change order document and cost breakdown to reflect the final agreement. Double-check that all numbers recalculate correctly.

Transmit the finalized change order to the client using the agreed method (for example, e-signature platform, email, or portal). Clearly indicate that this is the final version for execution.

Monitor whether the client has opened, signed, or returned the change order. Follow up politely if the document is pending and work is waiting on formal approval.

Ensure your own internal signatories sign the change order per company policy, either before or after client signature as required by procedure.

Once all signatures are obtained, save the executed change order to the project’s Contracts/Change Orders folder and link it in your project management and accounting systems.

Update the change register with the approval date, final amount, time impact, and location of the executed document. Change the status to “Approved/Executed” or equivalent.

Record the approved amount, time adjustment, and any key notes in both the formal change order log and the internal change event register. Mark any related events as combined or closed.

Adjust the project budget to include the new change order value in the appropriate cost codes. Update the cost forecast and projected final cost to reflect the change.

Issue subcontract change orders or purchase order revisions to pass through approved changes to affected trade partners. Ensure their commitments match the owner-approved scope and value.

In the scheduling software, enter any approved time extensions or resequencing tied to the change. Recalculate and review the schedule to confirm critical path and milestones are updated.

Communicate the approved change, scope, and schedule impacts to the project manager, superintendent, and relevant subcontractors. Provide clear instructions about when and how to implement the change in the field.

Ensure all related documents—executed change order, budget adjustments, subcontract change orders, and updated schedule reports—are filed neatly in the project system. This makes it easier to answer questions later and support post-project reviews.