The Project Change Order Request – Version 1

Ah…the Project Manager’s best friend and worst enemy…the Change Order Request.  Projects have been halted and customers have been lost by presenting one of these fun documents.  As most of you aware, the change order request is created to cover a known gap between the work that must be done and the work that was planned (and usually priced).

The change request originates because the customer or project now needs something that wasn’t planned as part of the original project scope.  It usually comes with a price tag because of a change in the customer requirements.  However, it can be and should be used to document any deviation in scope – even if it doesn’t result in a price change for the project.  That way you have a baseline (the original SOW and requirements) for the project and documented changes to that baseline (the change request documents) as a paper trail to cover what work was actually performed on the project.  It can also be useful at the end of the project when you’re trying to justify the resource hours spent on the engagement.

I’m calling this one Version 1 because I have at least one more example that I plan to post soon.  Email me if you find this helpful and would like a Word doc version of it or send me your example to post if you want to share a different version to our readers.

PROJECT CHANGE ORDER REQUEST

[Save file name as: client name CHANGE ORDER yyyymmdd]

PROJECT DESCRIPTION

Provide a brief description of the project objectives and overall performance of the work to be performed.

ISSUE TO BE ADDRESSED:

Describe the issue which the scope change will address

PROPOSED CHANGE IN SCOPE:

Describe the details of the scope change.

BENEFIT OF THE CHANGE IN SCOPE:

Describe the results of the scope change.

COST IMPACT OF THE CHANGE IN SCOPE:

The additional cost for this change will be $0. This will bring the total project cost to $0.

SCHEDULE IMPACT OF THE CHANGE IN SCOPE:

Project Schedule will be modified to a project completion date of month dd, yyyy.

ACCEPTANCE OR REJECTION OF THIS CHANGE ORDER:

The Client must accept or reject this Change Order within THREE (3) days of the date of this Change Order. The client’s failure to accept or reject within the prescribed period of time shall be deemed to be a rejection of this change order and Vendor shall continue with the project as if no change order had been issued.

Client hereby: Vendor hereby:

______ ACCEPTS the Change Order.

______ REJECTS the Change Order.

________________________________

Client Signature

______ ACCEPTS the Change Order.

______ REJECTS the Change Order.

________________________________

Vendor Signature

Phases of a Construction Project Life Cycle – Part 3

In Part 3 we’ll look at the next two phases of a construction project as described in F. Lawrence Bennett’s book entitled “The Management of Construction – A Project Lifecycle Approach.” In this article, we’ll allow Mr. Bennett to take us through the contractor selection and project mobilization phases.

Contractor selection phase

In anticipation of selecting a contractor, the owner must decide whether an open invitation will be issued to all possible vendors or whether only certain contractors will be invited to submit offers and whether any sort of pre-qualification process will be invoked to limit the number of tenders. On the other side, contractors will have to consider a number of factors in deciding whether they will make the effort to assemble a proposal for a particular project. If a contractor finds the prospective project attractive, two major tasks will be required. First, a series of planning steps will be carried out, including studies of various methods and equipment that would be employed and the development of a preliminary project program setting forth an approximate time schedule for each major activity. Second, a priced proposal will be prepared, including the direct costs of labor, materials, plant and subcontractors, various overhead charges and a sufficient added amount for profit. The last step in this phase is the submittal, opening and evaluation of tenders, the selection of the successful contractor and the finalization of the construction contract.

Project mobilization phase

After the contractor is selected, a number of activities must be completed before installation work can begin at the project site. Various bonds, licenses and insurances must be secured. A detailed program for the construction activities must be prepared. The cost estimate must be converted to a project budget and the system for tracking actual project costs must be established. The worksite must be organized, with provisions for temporary buildings and services, access and delivery, storage areas and site security. The process of obtaining materials and equipment to be incorporated into the project must be initiated and arrangements for labor, the other essential resource, must be organized. With the completion of this phase, it is finally time to begin the actual field construction.

Next

We will conclude this series on Construction Project Management Phases in the next article – Part 4. In that final installment, we’ll review of Mr. Bennett’s description of the project operations and project closeout and termination phases. If any of you have experience with construction project management and wish to comment, I would definitely like to hear your feedback as this is not an area where I have any prior experience.

Estimating the Project

Most of what I’ve written so far assumes that the project manager is usually in a situation where Sales has closed a deal for a project and the information is passed on to the Professional Services portion of the organization for execution. The project manager is assumed – unfortunately – to have little to no input into the estimation/sales portion of the project and he or she basically gets what they get. That would be in terms of negotiated resource hours, dollars/budget, and the statement of work (SOW).

Jason Charvat writes, in his book “Project Management Nation,” about the estimation process form the PM perspective – this would coincide with the type of work I performed earlier in my career where all high-level requirements gathering, estimating, pricing and negotiating the engagement with the internal business sponsor (these were all internal projects at a major corporation) rested on my shoulder. Talk about control…I loved it. Here is Mr. Charvat’s section from his book – this covers what he calls the estimation process.

The Estimation Process

The project manager should remember that the estimation that results from the planning phase is not final and is considered a temporary estimate. Once more detailed project planning is performed and the project costs and WBS schedules are fine-tuned, a more accurate estimate emerges. Basically, the estimation process has a few primary steps:

• Develop the WBS.
• Estimate each part of the WBS constituting the total project.
• Schedule the work according to each WBS task.
• Determine the resources needed, quantities, and availability.
• Obtain the latest resource rates, including next salary reviews and increases.
• Determine the level of effort needed to complete each WBS task.

Something that is very important during the estimation process is that project managers ask the client to pay a price that is relevant to the perceived value of what they receive. If the client is willing to pay for the project, the project manager needs to determine whether it is profitable enough to do the work. To determine this, project managers must determine cost. This is where the estimation is needed.

What to Include in a Project Estimate

• Internal labor or cost of employees – Burdened cost to company—benefits included
• Hardware costs – Servers, printers, workstations
• Software and licensing – Application software, downloaded software patches, code
• Travel and accommodation – Airfares, hotel, tolls, gas
• Administrative support costs – Personnel, finance, and legal support
• Training costs – User training, computer-based training, lesson plans
• System documentation costs – Manuals, policy & procedures, on-line documentation
• Stationary costs – Project stationary
• Infrastructure costs – Office space, desks, rent, parking

Estimating the Effort

It is said that you cannot manage what you cannot measure. No matter what project a project manager has been allocated or assigned too, the project estimate should include the following:

• Size of the project
• Resources required
• Project duration
• Costs needed to complete the project, labor, hardware, travel, etc.

Estimates in the IT industries are incredibly difficult to complete due to so many unknowns. The initial estimate is, in many ways, the most important. The initial estimate will be a focal point with which the project manager can compare all future estimates. Because of this, there are several recommended steps to follow when achieving an initial estimate.

• Break down the project requirements as far as possible to subsystem levels (WBS).
• For each WBS element, identify its similarities with previously developed projects and use this historical data.
• For those WBS element units not strongly related to previous IT projects, use SMEs to estimate the size of those elements needed.
• Form the size estimate for the entire project by rolling up the estimates for all the WBS elements.
• From historical data and expertise, estimate the level of effort.
• Divide the size estimate by the work rate to obtain an estimate of the effort in work hours.

Once the WBS has been developed, many project managers move directly to determining the duration of the task. This is normally done using a software tool, and it visually appears as though the project manager is on the right track. This is not the correct approach; it creates room for errors and bad planning. Remember that it takes a lot of skill and experience to estimate all WBS tasks. For example, it can take one seasoned IT architect a few hours to do a server capacity assessment, but the same task could take two junior IT architects double the amount of time to perform.

Similarly, a situation may arise where only one person can do a specific task, such as cloning a server. Only one resource can do the specific task, not two. Therefore, in this case, the emphasis is on ensuring that the resource is best-qualified to perform this task. The project manager also needs to discuss the issue with an SME to determine the amount of effort. The cost per task is directly related to the resources and effort needed. The project manager must accommodate the level of effort needed to perform the task.

Nakisa Inc. Selects Tenrox Project Management Software

(M2 PressWIRE Via Acquire Media NewsEdge) Glendale, California — Tenrox, the leading provider of on-demand project management software solutions, today announced that Enterprise Talent and Organization Management Solutions provider, Nakisa Inc. has chosen Tenrox as its supplier of choice in its mission to streamline its resource management, project cost and revenue accounting, time tracking and billing processes.

Initially, Nakisa was using manual processes and several disparate applications such as Excel, MS Project and Dynamics GP to track project time and expenses and to invoice its clients. It was therefore a requirement to find a tool that would allow them to have one system of record to manage all of these processes as well as having access to real-time project cost and revenue reporting and analytics.

After an in-depth review of several project management software vendors, Nakisa chose to the Tenrox solution not only for its professional services team but also for company-wide use due its comprehensive product offering and on-demand capabilities. During the evaluation of Tenrox project management software, Nakisa realized that users across the enterprise would benefit from taking advantage of the solution’s advanced project management features ranging from resource and project forecasting, resource scheduling, project accounting and project process management.

Tenrox on-demand project management software solution is being rolled out in three phases: Phase one includes the implementation of the Tenrox Time, Expense and Billing modules throughout Nakisa’s locations in Canada, United States and Germany. The software will initially be used by the professional services staff to report project time and expenses from the office or while travelling. Phases two and three include implementing the solution throughout the entire company and rolling out the Workforce Planning, Project Planning and Project Process Management modules “We identified Tenrox as the preferred project management software solution due to its capability to support our international business requirements and the appeal of their On Demand offering, among other things. We are convinced this solution will improve our resource utilization, streamline our project management, cost accounting, and billing processes and enhance our ability to effectively manage all of our human resources. We are aggressively pursuing the rapid integration of the entire Tenrox solution,” explained Babak Varjavandi, CEO, Nasika Inc.

Read the entire story here..