If youâve ever worked in EPC (Engineering, Procurement, and Construction) projects, you know that the word âclaimâ can instantly set off alarm bells. It often conjures images of conflicts, disputes, and strained client relationshipsâa topic many prefer to avoid.
But today, letâs flip that script and explore why claims shouldnât be the elephant in the room. Instead, theyâre a perfectly normal (and healthy!) part of project management.
This week, weâll untangle the myths around claims, explain their real role, and share why treating them as taboo could be more damaging than helpful.
Claims: Not a Sign of Failure, but a Marker of Change
First, itâs important to debunk a common misconception: claims arenât about scrambling to patch up poor project performance or trying to squeeze out unfair profit.
Instead, they are a contractual right that comes into play when conditions on a project shiftâand with those shifts come altered entitlements.
In many EPC projects, contractors hesitate to raise claims, fearing it might upset the client or harm the relationship. Thereâs often a hope that goodwill nowâpassing on a claim or twoâmight lead to smoother collaborations later.
- Admirable? Sure.
- Dangerous? Absolutely.
The hard truth: shelving legitimate claims may warm client ties in the short term, but over multiple projects, it steadily chips away at profitability and can even push a company toward insolvency.
Strong relationships donât thrive on silence or sacrificeâtheyâre built on mutual respect, transparency, and honoring agreed contractual terms.
Reframing the Role of Claims in EPC Projects
How should we think about claims? Instead of seeing them as confrontations, consider claims as structured, professional responses to change. Theyâre not emotional outbursts or blame gamesâtheyâre disciplined actions grounded in contract language and solid evidence.
Claims Are Clarity
They highlight how changing circumstances affect a projectâs cost and schedule.
Claims Show Commercial Maturity
Managing claims effectively demonstrates a teamâs ability to handle risk and protect financial health.
Claims Support Risk Control
When done correctly, claims are vital for keeping a project on track despite uncertainties.
In essence: well-prepared claims help everyone understand their position and what the new terms should beâreducing surprises down the road.
Balancing Client Relationships with Contractual Rights
Hereâs a key question: How does your organization balance warm client relationships with standing firm on contractual rights?
Itâs not an easy line to walk, but clear communication, trust, and shared respect make it possible.
After all, a strong partnership isnât just about smilesâitâs about fairness and accountability.
If youâre navigating this landscape, remember:
- Claims donât have to feel confrontational
- They can be a strategic part of project management
- They signal professionalism and discipline, not discord
Closing Thoughts
Claims are a natural, healthy part of EPC project management. When handled professionally, they protect profitability, support risk control, and strengthen partnerships.
Thanks for reading, and hereâs to building projectsâand partnershipsâthat stand the test of time!