Causes of Variations in Construction Projects

Variations in construction projects are alterations to the original scope of construction work. It comes in form of an addition, substitution, or omission from the original scope of works envisaged in the contract.

Also, it is defined as any change to the construction works, which is instructed or approved by the architect or contract administrator with the authority of the client.

Therefore, variation in construction means the modification of the design, changes in quality, and the quantity of construction work. It includes alteration of the standard of materials or goods to be used in the work and the removal from the site of any kind of material which is not as specified by the contract.

In construction, variations are inevitable. It is a good practice to anticipate them during both the design and construction phases to avoid surprises. Consequently, some contracts have clauses that permit variations within the bounds of the scope of works without changing the terms of the original agreement.

When Do Variations in Construction Projects Occur?

A variation occurs when changes are made to the original design after a contract has been signed. It could be additional work or omission needed for hidden problems that were not apparent at the time of the contract.

Changes to any of the contents of a contract document are effected using a variation order. Variation orders are usually initiated by a consultant on behalf of the client. They can also be raised by contractors and responded to by consultants.

Let’s see below the types of variation orders that can be found in a construction project.

Types of Variation Orders

There are two types of variation orders. These include the beneficial and detrimental variation orders.

Beneficial Variations Orders

Beneficial variation orders help reduce cost, schedule, or degree of difficulty in the project.

They are initiated for value analysis purposes to achieve a balance between the cost, functionality, and durability aspects of the project. This is to the satisfaction of the client by eliminating unnecessary costs from the project.

Detrimental Variation Orders

A detrimental variation order is one that negatively impacts the client’s value for money or project performance – by either reducing the owner value or hurting a project’s performance.

Types of Variations that can Occur in Construction Projects

The following are the types of variations that can occur in a construction project:

• Alterations to the initial design
• Modifications to the original quantities measured by the quantity surveyors
• Changes to the degree of quality demanded on the task
• Changes to the working environment
• Changes to the order/sequence in which the work is performed.

Causes of Variations in Construction Projects

Causes of variations include factors that are a result of the client’s actions, consultant-related factors or other factors generally. The following is a list of the main causes of variations in construction projects:

• Changes in the client’s requirements
• Technological advancement
• Change in general conditions
• Statutory changes or enforcement
• Geological anomalies
• Non-availability of specified construction materials
• Development of the design after the contract has been signed
• Error and omission in design
• Lack of proper coordination during project implementation
• Ambiguity in design detail
• Owner’s financial problem

1.      Changes in Client’s Requirements

In the beginning, the client’s requirements for a project could include a vision, mission, and set of goals for what they want it to accomplish. The needs of the client may change in the course of the design or construction stage and market conditions may impose changes to the parameters of the contract.

These changes will inadvertently vary the contract.

2.      Adoption of New Construction Technologies

Sometimes consultants adopt new construction technology after the contract has already been signed. In some circumstances, they may be forced by changes in by-laws requiring them to adopt the new technologies. Or when they do so to achieve better quality or reduce costs.

The adopted technological developments may alter the design and choice of the method of construction.

3.      Development of the Design after Contract Signing

The review of the design may bring about changes to optimize the design, hence the overall project operations. The drawings and specifications do not always show the real site conditions nor do preliminary investigations.

Despite this situation, it is common that works commence on site while some trades and building elements still need to be completely designed or detailed.

Consequently, contracts contain provisional quantities and sums that will be subject to future adjustment. The presence of provisional quantities or sums in a contract clearly indicates the likely occurrence of variation orders in a project.

4.      Geological Anomalies

Ground investigations are a way to assess the ground’s condition, ideally before starting construction projects.

They distinguish themselves from broader site investigations, which typically involve the collection of more general information from the client, such as via desk studies, walkover surveys, and so on.

If such information varies from the geotechnical reports and ground investigations, significant cost implications will be realized thus varying the contract.

5.      Unavailability of Specified Construction Materials

Specifications describe the products, materials, and work that are required by a construction contract.

When the specified materials are unavailable, alternatives have to be sought, and there may be cost implications. The client may go for a higher quality or lower which is going to vary the contract.

6.      Changes in General Conditions

The section of the contract document where the parties’ rights, obligations, and relationships are listed is the general conditions section. It outlines the obligations and rights of each contracting party as well as the guidelines that will regulate the partnership.

A condition is an agreement that could affect specific rights, responsibilities, or obligations in legal terms. A specified condition is recorded in writing. An implied condition is assumed to be there by default.

For instance, the client may want to shift the burden of obtaining the necessary construction permits to the contractor of which it may have been initiated in his scope to do so. Here the contractor will have to add a cost to it leading to a varied contract.

The contract stands varied when these conditions are changed mid-way through the contract.

7.      Compliance with Changes in Statutory Obligations

Statutory obligations are those that are imposed by law and do not result from a contract.

The specific legal requirements that apply to building design, construction, and operation are numerous and intricate. These requirements vary depending on the type of development that is being considered.

It is, therefore, crucial that contracts and appointment documents specify who is responsible for fulfilling statutory responsibilities and who is taking the risk of doing so.

While there are many different kinds of statutory requirements, there may also be many additional obligations that are related to the use a building is put to in the end.

Variations come by when changes are incorporated because set standards and approval procedures change.

8.      Errors and Omissions in Design

Errors or omissions in construction force changes in design hence variations.

If a contractor uses the original provided drawings and specifications to bid and further enter into a contract with the client; and later when it becomes apparent that there exist errors and omissions contract will be varied.

9.      Inadequacy in Design Detail and Specifications

For instance, if a plan calls for the construction of two doors in a room and the specifications don’t mention any ironmongery specifically, then it will be determined that providing the hinges is within the scope of work because it is an essential component of that activity.

It will then be included and its cost will be added to the original contract.

10.      Owner’s Financial Problems

The client may experience financial issues during the implementation of the project. For instance, when clients’ finances run out, they must stall the project for a while.

When the funds run out this will affect the timelines. Delays affect the preliminary items such as insurance, plants, and equipment.

Due to financial constraints, the client may want to scale down the scope to fit within the available funds. This will consequently make the client opt to omit; say for instance a whole floor may be omitted in a case of a multistory building.

In another instance, the client may have to scale down the quality of materials say from granite to ceramic floor tiles due to financial constraints.

These will cause a variation to the original contract.

11.      Lack of Proper Coordination During Project Implementation

Proper Coordination and proper management of the construction process is very key to achieving the desired final product in a construction project.

The poor project coordination is majorly caused by the Inadequacy of proper Planning and Failure to Communicate.

These two will eventually lead to confusion and mistakes will eventually happen.

For instance, when the project manager does not plan properly and schedule the activities, the builder’s works and services may end up clashing.

For instance, an electrical services subcontractor coming in after finishes have already been installed is going to have a major effect on cost and will vary the contract. If the project manager and the whole team were keen on proper coordination; mistakes may be avoided and thus variations may be avoided.

In Conclusion

We have seen that variations in a construction project can result from three main factors: client-related, consultant-related, and other general factors. Also, contractors can in some way contribute to the same.

Also, the variations come about as a result of changes and modifications made later after a contract has been signed.

When a construction contract is being drawn, it is advisable to think about these variations and devise ways of dealing with them. Do you set the contract as fixed (allowing no variations) or variable to some limit? All this depends on the level of design development that has been achieved during the tendering stage and the project’s financial constraints involved.

Therefore, factors such as the possibility of changes in client’s requirements, new technologies, design development after contract execution, varying site conditions, availability of specified construction materials, changes in by-laws, and errors and omissions in design and documentation, should be the subject of discussion when contemplating whether or not to accommodate variations in a construction project.

These are not the only possible causes of variations in construction projects. I understand that you might have come across some others in your practice. Please share with us in the comments section below.