Analysis of Factors Affecting the Use of Change Orders and Supplemental Agreements

摘要

Program Managers must often decide whether an engineering change proposal should be incorporated by change order, or by supplemental agreement. Currently, they are unable to assess the cost and schedule effects of each alternative at the time of their decision. The objectives of this study were to first quantitatively compare the cost and schedule effects of both methods, and second, to devise and test a model to assist program managers in selecting between each alternative. The data for this study were extracted from change orders and supplemental agreements issued during 1981 against the two major production contracts used to acquire the Fairchild Republic Company A-10A weapon system. This study concludes that there is not a statistically significant (alpha = .05) difference in the cost effects of either alternative, however, the change order was more expedient that the supplemental agreement. This study also devised a model. Three methods were applied to test the validity of the model: case analysis, correlation analysis, and algebraic analysis. All three tests were inconclusive. Although the study did not validate the model, recommendations for successful application are provided.