Riad AlhammoudProject management| LanganAbu Dhabi, United Arab Emirates
Dears,
Kindly could I have your inputs on the proper way for variation order process and what are the potential risks with this process? Saving Changes...
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Stéphane ParentSelf Employed / Semi-retired| Leader MakerPrince Edward Island, Canada
If you are in the construction industry, variation order is simply a project change request. If so the process is fairly straightforward.
1. Assess Impact of Project Change Requests
2. Decide if Project Change Requests should be approved.
3. Implement Approved Project Change Requests
While we can argue all the risks involved, the one I usually have dealt with, because of fixed scope/fixed price projects, is the loss of revenue associated with unapproved project change requests. After all, who wants to waste time assessing the impact of a change request if it's not going forward? (in one particularly perfidious one, the client did not approve our change request but turned around and used our bill of material to do it themselves.)
Consider using additional gates to decide if a project change request is worthy of being assessed. Also consider getting revenue for the assessment effort. Saving Changes...
Very interesting, Stéphane Parent do you have any template on this matter? It'd be tons of help to me.
Thank you. Regards, Pablo.
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1 reply by Stéphane Parent
Feb 09, 2026 5:10 PM
Stéphane Parent
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Hola Pablo!
If you are a PMI member, why not ask PMI Infinity for a template?
Take care, Stéphane
Saving Changes...
Luis BrancoCEO| Business Insight, Consultores de Gestão, LdªCarcavelos, Lisboa, Portugal
Good question. It helps to clearly separate process from governance, because many problems with variation orders come from mixing the two.
A robust variation order process typically follows five clear steps.
First, formal identification of the variation. The change must be described objectively: what is changing, why it is changing, who requested it, and when it was identified. Avoid implicit decisions or “since we are already here” logic.
Second, integrated impact analysis. Assess the impact on scope, schedule, cost, quality, risks, benefits, and downstream operational effects. It is not only about cost and time. A variation can introduce technical debt, contractual exposure, safety risks, or long-term operational constraints.
Third, contractual validation. Confirm whether the variation is covered by the existing contract or requires a formal amendment. This step is critical and often underestimated. Skipping it is a common root cause of claims and disputes.
Fourth, decision by the appropriate authority. Approval must be made by the role with delegated authority to accept cost, risk, and consequences, such as a sponsor or change control body. This is not a purely technical decision, it is a business decision with accountability.
Fifth, documentation and baseline update. Whether approved or rejected, the decision must be formally recorded and all affected baselines updated. Without this, the project loses coherence, traceability, and credibility.
In practice, it is also important to define clear roles and control points. Typically, the project manager coordinates the analysis, contract or commercial management validates contractual implications, and the sponsor or change control board makes the approval decision. For urgent changes, a controlled fast-track may be needed, with explicit temporary authorization and mandatory ratification afterward.
Key risks in variation order processes include normalized scope creep when small changes are accepted without cumulative analysis, late decisions that increase cost and reduce options, unclear approval authority leading to informal commitments, baseline erosion that turns plans into administrative fiction, and contractual conflict caused by weak records or field instructions not formally confirmed.
Variation orders are not inconvenient exceptions. They are signals of learning, uncertainty, or changing context. The risk is not the variation itself, but a weak process that turns conscious decisions into documented improvisation. When the process does not protect the decision, the project inevitably pays the price later. Saving Changes...
Stéphane ParentSelf Employed / Semi-retired| Leader MakerPrince Edward Island, Canada
Feb 09, 2026 9:05 AM
Replying to Pablo Nüesch
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Very interesting, Stéphane Parent do you have any template on this matter? It'd be tons of help to me.
Thank you. Regards, Pablo.
Hola Pablo!
If you are a PMI member, why not ask PMI Infinity for a template?
