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Construction professionals are constantly pushing the boundaries of design, sustainability, and efficiency, yet even the biggest and most well-respected contractors admit that how they manage extra work hasn't changed in decades. The outdated T&M Tag and Change Order processes are continually some of the biggest sources of headaches (and cost overruns!) for the entire commercial construction industry.

The headaches are optional, however. Many tech-forward contractors are growing their businesses with better financial controls and staying ahead of the competition by committing to new solutions and workflows for the entire Change Order process. In "How America's Top Contractors Process Extra Work 90% Faster" we look at the enormous impact the industry’s only Change Order Communication Platform has had on seven ENR 400 Contractor and ENR 600 Specialty Contractors who have processed over $2.5 Billion in Change Orders by streamlining manual workflows, reducing administrative burden, and improving transparency with all project stakeholders.

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Extracker is the first and only commercial construction software that provides real-time, collaborative, and transparent Change Order communication that is instantly accessible on our secure web and mobile apps. Project teams always have accurate cost information because the whole process from T&M Tag creation to Change Order Request review and approval happens in one cloud-based platform.

Real-Time Change Orders All in One Place

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Chances are your teams are tracking extra work and CORs in several places, including using paper, email, spreadsheets, and project management software. The problem with using these methods is that COR Logs are out of date the moment they’re sent because these tools don’t automatically update or contain real-time cost information. A customer may request this monthly, but once it’s sent out the log is out of date for nearly a month! At any given time, there may be dozens of change orders and several millions of dollars of extra work that is not reflected in the project’s financial forecast. Financial blind spots place the project budget at risk of cost overruns, which can be hard to correct as the project progresses and the backlog of Change Orders starts to grow.

Global General Contractor DPR was experiencing these issues on several key projects, caused by endless email threads and manually processing hundreds of Change Orders.

They’ve since reduced project risk and time wasted by moving their Change Order Communication to Extracker. “Tracking subcontractor Change Order requests through email across multiple projects not only is labor-intensive but also introduces unnecessary risk. We now have the ability - at a glance - to know our cost exposure before having to do any manual work and can process subcontractor Change Order Requests much faster,” states Mike Schaaf, Senior Project Manager.

On fast-moving projects, Extracker enables teams to focus on the critical path and spend less time tracking CORs. When Turner, the largest General Contractor in the US, was tasked with a short-term healthcare project in response to COVID-19, all costs were tracked on a Time and Material basis. “Traditional methods of signing daily paper T&M tags and getting costs emailed later would not have been efficient. Turner and our Trade Partners needed to focus on project execution and not be consumed with manual paperwork,” recalls Senior Project Manager, Nadeen Quru. Because of Extracker’s real-time communication, her team had no surprises when the project was completed. "On the last day of work, Turner knew the project cost in real-time and did not have to spend extra weeks or months on cost reconciliation."

Going From Backlog to Real-time Execution

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For specialty drywall and framing contractor, Raymond Group, their old process was suffering from inefficiency in tracking down extra work costs. “Before Extracker, there were tickets falling through the cracks because of the time it took to process them," recalls VP and Area Manager, Ray Gilbert. This negatively impacted their cash flow because Raymond is unable to bill customers for extra work that has been completed until the Change Order Requests are approved. “Now, Extracker allows us to get our Change Orders processed and billed the same month the work is performed.” Gilbert also appreciates having a centralized platform for Change Orders. “Previously, I would have had to jump between my accounting platform and Excel. With Extracker, it's all in one spot," he states. Extracker has saved Raymond's project teams countless hours each week and protects critical revenue on Change Orders.

Closing Faster Reduces Risk

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When the Change Order process is slow, all parties are at risk, especially Subcontractors. Today, T&M Tags are almost universally created with triplicate carbon copy paper. The Subcontractor keeps a copy, the General Contractor keeps a copy, and the jobsite keeps a copy. Back in the Subcontractor’s office, the T&M Tag is reviewed and an associated COR is created. That COR is then sent to the General Contractor for review and approval.

This manual process is slow and often results in significant delays, taking weeks (or even months!) to go from creating a T&M Tag in the field to submitting a COR, to getting it approved and paid. These delays in processing time create huge risk in the form of financial blindspots for all parties can become a huge drain on the industry in the form of wasted administrative time, disputes between companies, and cost overruns.

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Subcontractors

  • Manual tasks lower productivity
  • Potential for lost revenue
  • Costs carried on aging CORs

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General Contractors

  • Thousands of hours wasted tracking down Subcontractor CORs
  • Incomplete project cost exposure forecast
  • Potential for surprises

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Owners

  • Can't make value added decisions without complete financial picture
  • Uncertainty around costs
  • Higher changes of disputes, liens, etc.

Extracker reduces overall processing time down from one month to one week and cuts administrative time down from 2 hours to 5 minutes, a 95% decrease on EVERY Change Order. Multiplied over the hundreds (or thousands) of CORs on a project, the results are real savings on payroll and getting extra work processed and closed faster.

Before Extracker, nationwide specialty contractor BrandSafway was using a time-consuming, multi-step process for Change Orders. After switching to Extracker, BrandSafway now creates Change Order Requests in Extracker’s digital templates, and automatically notifies their customers with updated shared COR logs. Submitting revisions to their customers is as simple as clicking a button, making edits and automatically distributing the new COR. And because each COR is created and logged in seconds, BrandSafway is saving hours of time documenting and generating CORs.

“Previously, I processed 2 branches in a day and a half. With Extracker, I can do 4 branches in less than a day” says Vincent Abel, Project Accountant at BrandSafway.

BrandSafway's Results

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Creating and sharing CORs in seconds increased BrandSafway’s COR processing time by 65%.
Reduced Days Sales Outstanding (DSOs) of Unbilled Revenue by 30%
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Saved 16 hours of Monthly Administrative Reporting
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A Clear Financial Picture

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One of the biggest challenges that large general and specialty contractors face is managing Change Order risk across an entire portfolio of projects. Change Orders on the average commercial project can result in budget increases of 15-20%, often reaching into the millions of dollars of out-of-contract expenses. When this increase in cost exposure happens across multiple projects simultaneously, the effects of processing delays, rejected CORs, and end-of-project disputes can be devastating to a company’s bottom line and valuable relationships.

Managing the Change Order process on paper, email and spreadsheets is inefficient and full of financial blindposts, adding unnecessary risk and cost exposure to every project in a contractor’s portfolio. Contractors who have implemented, or are forever implementing company-wide project management and accounting solutions still deal with cost exposure because these tools are not communicating with external companies. They are purposely internal and secure.

Contractors that leverage Extracker along with their internal systems of record are able to see near real-time project cost information not just on individual projects, but also across their entire portfolio. Before using Extracker, General Contractor BuildGroup was tracking project costs in Procore, but still collected Change Orders individually. Because of that, their financials were always missing the latest COR Log. After learning their gap in financial visibility could be solved with a new tool, BuildGroup went all in on Extracker and its Procore integration.

Now BuildGroup uses Extracker to push Subcontractor Change Order Requests directly into Procore, removing a time consuming step in their Change Order process and reducing processing time by 65%. Previously, processing a typical Change Order took several weeks, and with Extracker, Change Orders are closed within days. The reduction in processing time has allowed them to identify cost discrepancies early, and as a result, they have more reliable and accurate financial forecasts across their portfolio. “By mandating Extracker across all of our projects, we have eliminated the inefficiency and risk in forecasting and collecting our subcontractor change orders.”

Better Process, Happy Contractors

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We would be remiss if we didn’t emphasize the role Change Orders play in customer-contractor relationships. Whether it's between GCs and Subs or Owners and GCs, Change Order disputes can cause a once positive partnership to go awry quickly. Using a single Change Order platform means that Change Orders are transparent and easily viewable by all involved parties, creating an environment of trust that enhances the customer-contractor relationship. Because everything in the platform is in real time, construction teams can be proactive, rather than reactive, about Change Orders.

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Extracker's digital tools drastically improved communication between nationwide specialty contractractor Performance Contracting, Inc (PCI) and their customers.

“Back and forth on COR revisions between PCI and our General Contractors has been reduced by over 50%,” reports Kevin Ullrich, Project Manager. Because all Change Order Requests are located in one place, there are no surprises, which makes their customer’s job much easier.

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Our customers report that Extracker makes subcontractors jobs easier too, with it’s easy-to-use mobile app and field-friendly features that capture documentation and signatures quickly on site.

BuildGroup saw success with adoption across all of their projects. “The ease of use and onboarding has made it extremely smooth getting our subs engaged in San Francisco, San Jose, Seattle, and Los Angeles,” Krause recalls.

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General Contractor, NOVO Construction, primarily performs large tenant improvement projects for corporate clients. They adopted Extracker to streamline their Change Order process and improve communication.

COO, Mike Ballou, states, “quality is important and relationships are key. If you hand in significant costs after the project is done–that the owner was not aware of–that is a great way to end a perfectly good relationship. With Extracker, we know we have our subcontractors’ current costs.”

The benefits extend to the entire project team. “Extracker is more organized and efficient,” states NOVO Senior Project Manager, Jacob White. “The owners, construction managers, and developers find it easier to read, they like the formatting, and they enjoy it as much as one can enjoy Change Orders.”

Close Extra Work Faster

See for yourself why contractors on ENR’s Top 400 and 600 choose Extracker by booking a demo of our software today. The best part? Your project teams can start using Extracker right away in a Free Pilot, with no installation or steep learning curve.

Ready? Request a demo today!