Summary
In this episode of the Management Under Construction podcast, Brad Wyant and Dee Davis delve into the complexities of change orders in the construction industry. They discuss the importance of understanding change orders, the psychological factors influencing cost estimations, and the impact of low bidding on project costs. The conversation emphasizes the necessity of building trust between contractors and owners, the significance of accurate documentation, and the challenges posed by design issues. They also explore strategies for effective negotiation and the importance of contingency planning to manage unexpected costs. Throughout the discussion, the hosts share personal anecdotes and insights, providing listeners with practical advice for navigating the often-contentious world of change orders. When you are done with this podcast and implement the wisdom imparted, you will have begun your change order wizard journey. This is the way. 
Takeaways

Change orders are a critical aspect of construction management.
Accurate change orders protect the reputation of contractors.
Understanding the psychology behind cost estimations is essential.
Low bidding can lead to higher costs through change orders.
Building trust with owners is crucial for successful change order management.
Contingency planning is necessary to handle unexpected costs.
Time pressures can complicate the change order process.
Strong relationships can facilitate smoother change order negotiations.
Design issues often lead to change orders and must be managed carefully.
Effective communication and documentation are key to successful change orders.

Chapters
00:00 Introduction to Change Orders01:45 Understanding Change Orders04:17 The Importance of Documentation06:41 Psychology of Cost Estimation09:23 Economic Incentives in Change Orders11:59 The Role of Marketing in Bidding14:18 Trust and Relationships in Construction16:48 Owner's Perspective on Change Orders19:12 Time Pressure and Change Orders20:05 Constructability Issues and Design Changes24:53 The Amnesia Factor in Change Orders33:28 Design Responsibility and Liability38:14 Navigating Change Orders and Owner Expectations39:05 Building Trust and Setting Expectations47:00 Effective Communication in Change Orders56:10 Negotiating Change Orders and Fair Pricing

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