All In Agreement: Status
“Open Issues” are situations that impact the timely completion of a job and in almost every case cost the wall and ceiling contractor money. For example, a simple open issue for an acoustical ceiling contractor could be getting clarification on the ceiling height in a hallway. For a painting contractor, it could be as simple as the designer or owner picking out a paint color.
There can be complicated open issues, such as ductwork being lower than a finished ceiling or the plumber forgot to put in a vent pipe. Other open issues can be missing doorframes, missing insulation, missing can lights, or structural steel and concrete in the wrong location. There can be literally hundreds of open issues on a residential or commercial project.
Think about how many times you’ve had to wait and work around an open issue? How much did it cost you? How much did it cost you to go back to an area to drywall an 8 foot by 8 foot ceiling and go back and paint the same ceiling? First, think about how much time you had in your estimate to drywall or paint that ceiling. To hang 64 square feet of drywall, we would be looking at somewhere between 30 to 45 minutes. To tape or paint, we would be looking at about the same amount of time for each.
How do you compare the time you had in your estimate vs. the time it would take to remobilize manpower, equipment, and material to do that same 64 square feet, as well as clean up? Could it be done in the amount of time you had in your original estimate? The right answer is absolutely not. The question is how do you prove it to yourself, your employees and most importantly your client?
DAILY OPEN ISSUE LOG
Most if not all subcontracts include language requiring the subcontractor to notify the GC of any delays and/or deficiencies in the prior trades’ work. For example, if a contractor hangs drywall on a ceiling prior to can lights being installed, the contractor “contractually” can be held responsible for removing the drywall and re-installation. Contractually, you cannot proceed with your work until the preceding work of other trades is completed, and completed correctly.
Wall and ceiling contractors have two issues that need to be tracked on an open issues log: First, issues delaying the subcontractors work and second, work performed by other trades that is deficient.
On the bottom left is an example of an open issue log using an Excel spread sheet. The power of an open issue log depends on how you want to use it. However, you should keep in mind that nearly all subcontracts require subcontractors to notify the GC of delays and deficiencies.
An open issue report can be as complicated or as simple as you want it. What you must know is that some GCs will not like getting it each day or week because it looks as though you are posturing for a claim. I’ve had good results explaining that we provide this report as a tool.
All jobs have issues, but you never know when a job is going to have so many issues that it begins to impact your bottom line. Some subcontractors may want to use a log on certain jobs or for certain GCs.
Here is what I like best about the open issue log. Let’s say there are 200 items on your log and you know that at some point the GC is going to have to address these issues so you can complete your work. What if 50 percent of these issues are in areas that you’ve already been through? In other words, 50 percent of the items are loose ends that your company has to remobilize manpower, material, equipment and clean up for.
Finally, the GC says that Issue #1 is ready for you to complete. Issue #1 is going to take a total remobilization because all of your work in this area was done months ago. At that point, it’s a good idea to explain to the GC that the cost to go back and complete Issue #1 is going to cost more than you had in your bid. Explain that you’re going to do the work on an EWA and reference it as Open Issue #1. Include all the labor hours, material, and equipment it takes to complete Issue #1 and arrive at a total price for that issue.
On the same EWA, subtract the amount you had in your bid to do the work. This leaves you with the true cost of having to complete the work out of sequence and at a later date.
A million dollar job with 200 open issues is going to cost you money. The cost to complete 200 loose ends will ruin an otherwise good job. Why should any subcontractor have to lose money due to the GCs or owners’ poor project management?
As tight as the market is today, I don’t think any of us can afford to piecemeal a job. I hope this gives you some ideas on how to manage loose ends and I hope everyone adopts an open issue log.
Remember: Teamwork begins with a fair contract. W&C