9 Step Guide to Construction Change Order Management (Using Digital Twins)

On any construction site, change orders are inevitable—they're just part of the business. But when they’re mishandled, one small adjustment can set off a chain reaction—schedules slip, costs balloon, and relationships between contractors, owners, and subs fray under the pressure. 

What starts as a minor scope change can spiral into disputes, stalling progress and draining budgets faster than you'd expect. Handled well, though, change orders don’t have to derail a project. 

With clear documentation, transparent communication, and timely approvals, they become opportunities to reinforce trust and keep teams aligned. Projects stay on track, margins stay protected, and costly claims never gain traction.

Understanding construction change orders

Change orders are how you formally adjust a construction contract. While people sometimes use “change orders” and “change directives” interchangeably, they're different concepts to understand before resolving change order management process issues.

A change order (CO) is a binding amendment to the original contract, issued once scope, cost, and schedule adjustments are fully documented and agreed upon by all parties. A change directive (CD), by contrast, is a unilateral order from the owner or architect to proceed with work before those terms are settled. Directives keep projects moving, but often lead to disputes when final costs are negotiated later.

Change orders typically stem from three common triggers:

• Unforeseen site conditions. Examples include subsurface issues, hidden MEP systems, or structural surprises discovered during renovation.

• Design errors or omissions. These include missing details or conflicts in drawings that require RFIs and scope adjustments.

• Owner or regulatory requests. These involve mid-project client changes or new requirements imposed by inspectors and code officials.

You can't avoid these triggers—but you can control how much they impact your projects.

Common challenges in managing change orders

Managing change orders isn't straightforward. Even with clear contract language, a handful of recurring issues cause projects to stall:

• Disputes and legal exposure. When documentation is vague or missing, it invites claims.

• Approval delays. Manual workflows can stretch the approval process to weeks.

• Poor documentation. When reports and photos are scattered, they lack full context.

• Tracking impact. Multiple small changes can snowball into major overruns.

Left unchecked, these challenges ripple across the project: schedules compress, costs rise, and collaboration gives way to finger-pointing.

A 9-step guide to effective change order management in construction

Effective change order management starts with reliable documentation. When every stakeholder can see the same site conditions, conversations move from finger-pointing to problem-solving. 

That foundation makes a real difference. Wesbuilt Construction saw a 61% reduction in document errors and omissions by using digital twins to capture and coordinate project milestones, giving its teams the clarity to process changes without slowing progress.

Change orders will always be complex, but with the right framework, they don’t have to derail your project. The nine steps that follow lay out how to capture, document, and communicate each change so your teams can resolve issues quickly, protect margins, and keep work moving.

1. Accurately capture and log change orders

The first step in managing a change order is making sure it’s documented the moment it’s identified. That could be a field discovery during demolition, an RFI that uncovers a design gap, or an owner’s request that shifts the scope. In each case, the process starts by recording what’s been found, where it’s located, and when it occurred.

Log these details immediately—don't wait for the weekly meeting or until after crews have moved on. Field teams should capture the condition with photos or scans, tag it to the relevant drawings or contract language, and create an entry in the project management system. The faster this record is created, the easier it becomes to track accountability and prevent disputes.

This is where digital twins make the difference. Instead of scattered notes and photos, a 3D scan provides a single, time-stamped record of the site. The change is logged in context, preserving every detail for owners, architects, and subcontractors to reference later. That baseline becomes the anchor for every step that follows—scoping, pricing, approving, and executing the change with confidence.

2. Clarify scope and design impacts before they escalate

Once a change is identified, the next step is defining exactly what it means for the project. That often requires collaboration with the architect or engineer to update drawings, confirm specifications, and understand how the adjustment ripples into related systems.

You need to be precise here. Take the example of uncovering an unexpected pipe during a renovation. If the issue is logged as simply “relocate pipe,” it leaves room for interpretation: where should it be moved, what other systems does it affect, and how much clearance is required? 

Without clear direction, the fix can trigger new RFIs and weeks of delay. By contrast, documenting the pipe’s exact location in a digital twin and tagging it with notes for the design team gives everyone the same starting point. The architect can adjust drawings immediately, and subcontractors can price the work without guessing.

With that clarity, small discoveries won't snowball into major disputes.

3. Calculate reliable budget and schedule adjustments

Capturing the financial and timeline impact of a change means more than a quick estimate. Every adjustment can ripple across multiple cost categories:

• Labor. Additional hours for crews or specialized subcontractors to perform rework, demolition, or new installations.

• Materials. Revised quantities, replacement of damaged stock, or ordering substitute products that meet updated specifications.

• Equipment. Extended rentals of cranes, lifts, or other machinery; mobilization and demobilization costs if work has to stop and restart.

• Overhead. Extra supervision, extended general conditions, and increased project management time.

• Logistics. Impacts to delivery schedules, staging areas, or storage requirements for replacement materials.

• Downstream trades. Adjustments that ripple into other scopes of work (e.g., relocating ductwork requiring electrical rerouting).

• Contingency drawdown. Additional costs that eat into reserves, reducing flexibility for later changes.

On the schedule side, even a single change can compress float on the critical path or stack trades in ways that raise coordination risks. The challenge is that these impacts are notoriously hard to quantify with traditional notes and 2D photos.

This is where digital twins shift the equation. Matterport gives teams measurable, time-stamped site data to validate cost assumptions and schedule impacts:

• Measurement Mode. Teams can quickly capture dimensions in the model to update material orders or scope adjustments without revisiting the site.

• Side-by-side comparisons. Teams can place current and previous scans side by side to see exactly what has changed.

• SIMLAB STAGES integration. This integration syncs a finished model with a rough-construction model to reveal hidden systems. As Anthony Carrino, owner of Anthony Carrino Design & Consulting and host of HGTV’s Kitchen Cousins, put it: “We can point the camera at finished walls. We basically have X-ray vision and know where every pipe and wire is… We can avoid unintended damage before it ever becomes a thing.”

By turning site conditions into measurable data, project teams gain the clarity to make accurate budget revisions and schedule adjustments without slowing the job down.

4. Draft a clear and complete change order package

A change order is only as strong as the documentation behind it. To avoid confusion and back-and-forth, each package should consistently include:

• Scope narrative that concisely explains what’s changing and why.

• Revised drawings of updated plans or details from the architect or engineer.

• Cost breakdown that includes itemized labor, materials, equipment, and overhead.

• Supporting references such as contracts, specs, or code requirements tied to the change.

Standardized templates make this process faster and ensure no detail gets overlooked. But clarity doesn’t stop with text. 

Attaching a 3D digital twin—complete with visual annotations—gives everyone the same reference point. Instead of interpreting written descriptions, stakeholders can see the change in full context, reducing miscommunication and streamlining approvals.

5. Negotiate change orders without conflict

The negotiation table is often where projects stall. Owners press for certainty, contractors defend their margins, and subcontractors hesitate to commit without clear direction. If the discussion is based on incomplete records, it quickly turns into a debate over who remembers what, rather than how to move forward.

The solution is full transparency. Every conversation should reference the same documentation, and every outcome should be recorded in writing. 

A digital twin makes that possible by acting as a shared “single source of truth.” Instead of circulating competing photos and notes, stakeholders can log in from anywhere, review the same conditions in context, and agree on next steps without leaving room for interpretation. That clarity defuses tension and keeps negotiations focused on solutions instead of conflict.

6. Streamline sign-offs and contract updates

Once negotiations are complete, the change order must be formalized. That means securing the required signatures in line with the contract hierarchy—typically the owner, architect, general contractor, and any affected subcontractors—before work proceeds. 

The final package should also include updated contract language and purchase order revisions, ensuring every adjustment is captured in the official record.

7. Monitor approved changes

Once a change order is signed, the risk shifts to execution. Field crews need to implement the adjustment exactly as agreed, and project managers need to confirm it aligns with the updated drawings, budget, and schedule. 

Without structured monitoring, it’s easy for changes to be misapplied—ductwork installed in the wrong place, electrical rerouted without proper documentation, or new finishes added outside the approved scope. These errors don’t just create rework; they erode trust and can spark disputes long after the fact.

Digital twins help here by anchoring every approved change in the project's visual record. When paired with construction management platforms, that record becomes part of the daily workflow:

• Procore. Matterport models can be embedded directly in Procore, so every RFI, approval, or change order points back to the exact location in the 3D model. Instead of chasing down paper trails or disconnected photos, project managers can click into the model and verify progress in context.

• Autodesk Construction Cloud. Within ACC, Matterport scans can be used alongside drawings and BIM data to track how approved changes are executed. Potential Change Orders (PCOs) can even be created directly from issues raised in the digital twin, ensuring visual evidence and cost tracking stay connected.

This integration matters because construction moves quickly. A detail that looks minor during sign-off—like relocating ductwork or re-routing electrical—can snowball if it isn’t tracked properly. By monitoring approved changes through a single visual source of truth, teams gain an audit trail that protects them long after the project closes out. If questions arise years later, the record is still there: verifiable, time-stamped, and tied directly to the original approval.

8. Avoid cost and timing overruns

Even when change orders are approved and executed correctly, they carry a hidden risk: cumulative impact. A handful of small adjustments can quietly drain contingency funds or push the project behind schedule if they aren’t tracked in real time. By the time overruns become visible in the budget, it’s often too late to course-correct.

To keep costs and schedules under control, focus on three things:

• Build a dynamic change order budget. Don’t treat each adjustment in isolation. Track how each one affects the burn rate against contingency reserves so you can see early warning signs when reserves are running thin.

• Tie schedules to real-time site data. Paper schedules can lag weeks behind reality. Aligning them with milestone captures ensures shifts in the field are reflected immediately in the project timeline.

• Use KPIs to flag red-zone risks. Monitor metrics like turnaround time on RFIs or average approval duration for change orders. A spike in these indicators is often the first sign that costs or timing are slipping.

Digital twins enhance each of these practices by providing an objective record of conditions and progress. Instead of relying on abstract reports, project managers can tie cost and schedule forecasts to verifiable site data, reducing the domino effect where small oversights compound into major overruns.

9. Navigate change order disputes smoothly

Even with strong processes, disputes are part of construction. Authorization disagreements, cost and schedule impacts, or missing documentation can all trigger conflict. Left unresolved, these disputes stall projects and often end in costly claims.

The difference between losing time in arbitration and resolving quickly on-site comes down to evidence. If you’ve followed the steps to this point, you should be in a strong position to handle change order disputes smoothly. 

Best practices for navigating those disputes include:

• Rely on documentation, not memory. Use digital twins as the permanent record of site conditions.

• Clarify the scope with visual evidence. High-resolution 3D models provide objective proof when written reports fall short.

• Stay transparent in communication. Browser-based models allow remote stakeholders to access the same view and add comments in context.

• Maintain a defensible audit trail. Time-stamped scans create a verifiable history that holds up in negotiations—or in court.

Our own Senior Solutions Engineer for AEC, Steven Allen, explains it this way: 

“Digital twins can serve as a single source of truth and provide photorealistic 3D imagery, which means every little detail your teams and stakeholders need for success is readily and immediately available.”

That level of clarity turns disputes from project-stoppers into opportunities to reinforce trust and protect margins. 

Managing change orders with confidence

Change orders will always be part of construction. What determines their impact is the quality of the documentation behind them. When every adjustment is captured clearly, communicated transparently, and tied to a verifiable record, the process shifts from reactive firefighting to proactive control.

Matterport digital twins provide that foundation. By creating a comprehensive, time-stamped record of site conditions, they give project teams the clarity to make informed decisions, the speed to keep approvals moving, and the accountability to prevent disputes. With the right tools and processes in place, change orders stop being a source of friction—and become a way to build stronger alignment across the project team.