How to Master Contract Administration in Construction

I'm going to show you how you can be an amazing contracts administrator, get promoted, make more money, and ultimately make the company that you're working for more money, help them have better cash flow, better margins, and reduce their risk, which is going to want them to, to keep you around for a long, long period of time. And hopefully you can make a great career out of it. My name is Cian Dillon Brennan. I've worked for or consulted for 15 of the top 30 largest construction companies in the world. I've worked on their side of the fence. I understand how the game works, what they're looking for, and how you can get documents in and approved and ultimately get paid for changes and delays and avoid disputes and that whole thing, right? So one of the key things that you have to remember as a contracts administrator is it's not about pushing paper from A to B. So many contract administrators think that, okay, my job is there's a change order that I need to produce, there is a delay, document that I need to produce, and that's basically it. So I get that and I submit it and then I'm done, right? Or I help with the bidding process and I'm just essentially a paper. I get all the information, I put it on paper, and that's it. That's not going to provide that much value to your company that you're working for. If you can help them save money by not having to hire lawyers, if you can help them save money by getting changes approved quicker, getting changes approved more often, you're going to make them more money. So these are the kind of things that we need to concentrate on more so. So let's just go in the process. and we go to the pre-contracts award process. What's important about that? So when we look at the contract terms itself, most contracts administrators don't understand each of the terms of the contract. There's about 27 things that pop up in every single contract. You need to have an understanding of each of those things, right? So very quickly, go through the contract, Google all of those things if you need to, understand the implication of all of these things. You need to understand the insurance provisions, the delay clauses, damages, termination clauses. If you can easily understand what they all mean, that is very, very beneficial to your company. So you can understand and you can explain to your company, hey, they're saying that we can't terminate the contract full stop. So if we get into trouble, we can't get out of the contract. That's not something we want to be involved in. And then your bosses will be like, oh yeah, that is important. We don't want to have that. So having a big understanding of those key 27 things makes a really, really big difference. Now, The problem with lawyers, where you can be great, you should have a good understanding of the actual constructing, what happens on site. Lawyers understand everything in the clauses for sure, of course they do, and they understand the risk, but they don't understand how it actually plays out on site. So again, if you can go another level deep with the clauses in the contract, the sections of the contract where you can say, I get that that's risky, but we don't have that risk because we don't dig in the ground, so we're not worried about ground conditions, we just we install steel columns, right? So the ground stuff is already done, it's nothing to do with us, the civil company does it, we just put columns up, right? Then you can go, okay, well, that's not important, so I can choose to get rid of it. Or maybe if I'm trying to negotiate 10 or 15 different items, that's just one I just don't bother with because we know it's just not going to be an issue. Then you can start making changes and getting more things into the contract and getting better results from negotiations, which your company are going to be absolutely delighted with. So that's the first thing. Another little tip that you can do as well is always try to get an additional— so you're going to have your price that you submit to the client, it might be lump sum, but what we want to have is an additional pricing schedule that you're going to have just for changes and just for delays. That pricing schedule can typically, if you've already won the project, that can be a little bit higher rates than you've submitted in your normal bid for changes, and then you're going to make more margin for any changes that come in on site. The reason you can do that and the reason you say to them is, hey, can we just agree a schedule of rates for changes? Because that way we don't have to negotiate every single time you ask us to do something. We can give you the price very, very quickly and get it sorted and signed off and done. They're like, yeah, that sounds like a good idea. Then you're going to help them make more money. So, and that's the pre-award phase. If you can help them sign a lower risk contract that helps them set up for better success in the post-award phase, then that's very, very important. Just quickly, I created an exclusive video on how the 1% of contractors and subcontractors in the world are making an additional 5 to 15% more margin and cash flow on every single project. It's a little-known framework that they've been using for decades and decades. Head over to the description and click the link there, and it'll take you to that exclusive video. Check it out now. The next part is understanding your site really, really well. You have to have a really good relationship with your project managers, the supervisors on the team. You need to walk around site all the time to understand how things are progressing. Once you understand the site itself very, very quickly, you can catch changes. The biggest problem in construction is doing work for free. You're asked to do work or something's changed and you just go ahead and you just do the work and you never capture the change. If you can be a master at understanding what's happening on site— oh, that's not what was supposed to be done, we did this extra thing— Bang, change. Let's get the change documents in. That is the important thing. The important thing is not getting the change document in, not waiting for the project manager to see it. If you can be the guy that they're like, oh, you go, here, there's a change, here's a change here. And they're like, yeah, there was a change. That's how you're going to be able to get more basically cash flow into the business and improve the margins. The next thing is disputes. We don't want to be in a dispute at all. No one wants to be in dispute. A dispute is a race to see who loses the least amount of money. So avoiding disputes at all costs is very, very important. So if you can be the type of person that can have a good relationship with your opposing person to avoid disputes, you're gonna save your construction company a lot of money. Now, the key thing with disputes is getting ahead of the problem. If you see that there's gonna be an issue, it's you wanna be able to go and have the discussion very, very quickly, follow what we call is the GROW process. So anytime you go into a construction meeting, follow the GROW process, as in, hey, my goal is to get a resolution for this, that's G for goal, R is for reality. Here's the reality situation. Bang, bang, bang, bang, bang. No emotion whatsoever. O is for options. Here are 3 options that we can do. We can have a big bloody fight about it and go to court, and we can cost us millions. We can come to this resolution here or some other option, and then ask them what they want to do. Give them the power to choose from the 3 options that they gave you. We found that to be very, very effective. But if you get into a dispute, it turns into a nightmare. So getting in ahead of all of that makes— is very, very important. The next thing is, how do you be contractual without being aggressive? How do you do it in such a way that they don't think you're combative? That's your job to do. And the way to get around that is when you start the project, if you start submitting notices and your changes and EOTs straight away, straight out of the blocks, they don't think that you're aggressive at all. They just think you're very, very professional because that's exactly what the contract said to do. If you do it the wrong way, which is you do nothing and then suddenly there's an issue and then you switch on all the notices and start writing letters, bang, that's what's going to kill kill a relationship. Another way that you can help your company is crafting an arrangement where you can try and get a master services agreement or a framework agreement agreed with that client so that they can use you again for future work. So bringing that conversation to your opposing project manager, provided you're doing a great job— let's face it, let's— we hope that you are— then you can create that relationship. And then what we can happen is we can move away from tendering and bidding and just go to that relationship sort of way of winning work, which is going to help your construction company win more money. Good contracts administrators are not paper pushers. They're switched on commercially. They understand the margins. They understand cash flows. And when you're talking internally to your company, you should be using this language. You should be saying, hey, we can get an additional payment here. We can get this money here. There's been a change over here that I think we should claim for. If you can be the guy that's bringing up those things and raising those things in your internal meetings, they're gonna go, this guy's switched on commercially. We need to have him on every single project. He's making us more money than, you know, whatever. So contracts administrators, if you can move from being a paper pusher to being a person that's able to get them more money, then you're going to grow and grow and grow and earn more money in your construction career. Drop a comment below, happy to answer any questions you have.