Variations – The Elephant in the Room | C-Link

1 June 2018

Variations – The Elephant in the Room

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I’ve got breaking news for you, and you heard it here first: A lot of people in the construction industry don’t like Quantity Surveyors. In fact, you could probably split the industry into three groups. A third of the industry don’t like what we do; a third of the industry don’t know what we do; a third of the industry love what we do for their business. Maybe I’m exaggerating slightly, it’s probably not quite a third of the industry that love what we do, but you get the point.

As a QS, it’s hard not to feel the impact and the bad feelings towards our profession. There are some bad eggs around, as there are in any profession, but on many occasions the negative perception we encounter is because we are the people that fire the bullet. But, the bullet has often been loaded by a boss or someone higher up the chain, someone who has instructed us not to pay the subcontractor for one reason or another.

The instruction from above could be for many reasons such as the quality of the works, the attitude/approach of the subcontractor, or the company’s cash flow. Some main contractors will also introduce strict policies on variations that make it really difficult for the subcontractor to claim costs. Others create really one-sided contracts, hoping that the subcontractor won’t delve too far into the contract details, ensuring an easy win for the QS if placed in a position where they need to withhold money from the subcontractor.

I’ve worked on both the main contractor and subcontractor side, so I’ve been in a position as QS where I’ve dished it out and felt it coming my way. Having worked as a QS in the industry for sometime now, it’s clear to me that this whole approach is completely counter productive for all stakeholders. It’s critical for all involved that a Main Contractor maintains a good working relationship with its subcontractors, and the QS is fundamental to that relationship. If the relationship revolves around a constant game of cat and mouse, you end up with a toxic atmosphere on site. You inevitably get more delays on site, more disputes, and a work life that just isn’t enjoyable.

As a main contractor, I wanted a good relationship with my subcontractor. From a personal perspective, it makes my life as a QS easier. It inevitably leads to greater project performance from a commercial perspective, as you’ll have fewer delays, fewer disputes, and more good will from the subcontractor.

The key to building a good relationship starts with your first meeting, and I think the one element to focus on at first is the elephant in the room: variations.

Variations: The Elephant in the Room

Early in my career working as a QS for a main contractor, I had a few variations and day work sheets coming from subcontractors out of no where. No lead up and no heads up. At the end of the month, variations were landing on my desk that I’d not seen up to that point. I didn’t want to be the bloke at the end of the project who says, “we haven’t issued an instruction for that, so it’s not a variation.” That just turns any relationship sour. But, I was in a difficult position, as my boss wouldn’t have been happy if I just passed these through. It felt that I was on the back foot from the beginning.

As a subcontractor, I’ve been in meetings where the main contractor says at the start “no variations.” As the subcontractor I’d be saying, “so what, we just swallow all the costs if there’s a change?” It would immediately get my back up. For the main contractor, some times it works, but you’ll never build good relationships with subcontractors from that starting position.

When I thought more about my role and position as a QS for a main contractor, and my desire to build a good supply chain, I felt that the problem with variations was a reluctance to talk about them early on. It feels almost taboo, that we don’t discuss them, that the subcontractor just slips them through the backdoor and the main contractor QS bats them away by email. If we opened up a dialogue early on about how we’d deal with variations, I thought it could help address the issue, and also start the foundations of a good relationship.

Here’s how I approached it: I wanted people to know that I would treat them fairly, as long as they didn’t start playing games just to drive up costs or delay progress. When I start a relationship with a subcontractor, I’m starting with the assumption that the subcontractor doesn’t trust me because it’s highly likely they’ve got a bad experience somewhere down the line with a QS. So, when I was in my pre-let meeting with them, and ideally I’d be with the person who I would personally be dealing with throughout the contract, I’d be very clear with them:

I’ve given you the spec and drawings and we both understand the scope. I’ll be totally honest with you, if there are any variations that are questionable, I’ll push back. If anything is in the drawings or spec, but not present on your quotation, it’s not a variation. If it’s a variation for me, it’s a variation for you.

That comment shows that I’m willing to talk as long as we’re going about it properly. I’d also ask, if there is a variation, speak to me first before you do anything about it. This helped me upstream the extra costs to the client as the subcontractor would give a good level of substantiation for the extra monies which in turn helped me to justify the claim.

With that open book strategy, the relationship would evolve from a good place. The project normally ends positively, the accounts end positively, and the subcontractor will want to work with you again. If you’ve got a subcontractor who does trust you, that subbie will help you out in sticky situations. You’ll go to the top of their list, rather than the bottom. Things take one week rather than two, and minor tasks are sometimes done quickly and FOC.

Because of this approach I was able to build and maintain several good relationships in each subcontract trade.

Chris Barber

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