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Value Management Strategy For Occfc Information Technology Essay

The aim of this paper is to look at the VM strategy for Old Cross Community Fitness Centre through evaluating and appraising the group work, the paper first define VM and traced back its origin, and then moves into giving short brief about the project which is the subject of the study. Then the paper shows the steps taken in deciding the best VM study style, after that the paper moved into the generic processes of VM from the Orientation and Diagnosis phase, the Workshop phase and the implementation phase by detailing each one of the components and concentrated in workshop phase as that stage represents the team work. The environment or the context of study, the participants and why they are needed and the inputs and delivery of the study are covered and the paper is ended by the best way of presenting the study outcomes.

According to Merna in (Smith 2002) the term Value Management (VM) tend to be a blanket term that includes many value techniques such as Value Planning (VP) , Value Engineering (VE) and Value Analysis (VA), therefore the definition of VM may vary from country to country and from industry to an other, The underlying assumption to VM is that there are always many ways to achieve any function, and that an exploration and examination of other alternatives may produce a better-value solution (DHW. 2005). the Institute of Value Management (IVM. 2010) takes Value Management as the tools and techniques concerned with improving and sustaining a desirable balance between the wants and needs of stakeholders and the resources needed to satisfy them. It’s the process in which the functional benefits of the project are explicated and appraised consistent with the value system determined by the client (Kelly, Male et al. 2004). British Standard define VM as the management style that could motivate people, develops skills and promote innovation (BSI. 2000). It is the relationship between the satisfaction of needs and the resources required in achieving that satisfaction (Venkataraman and Pinto 2008). CIRIA defines VM as the structure approach that helps defining the clients value requirements and ensure the delivery of that value through the design and construction process (Connaughton and Green 1996), the institution of civil engineers (ICE) definition of VM take it as a set of techniques and tools to enhance the project (ICE. 1996) while (BRE 2010) defines Value engineering (VE) as a pro-active, creative, team approach to problem-solving in construction projects to provide the best value for money. Australian based Department of Human Service (DHS) defines VM as the systematic review of the essential functions or performance of a capital project to ensure, that best value for money is achieved which is compatible with Total Asset Management Manual (TAM) definition of VM as a structured, analytical process for developing innovative, holistic solutions to complex problems (TAM 2001) . (Chen, Chang et al. 2009) considered Value Engineering (VE) as the organized application that uses both technical and non-technical knowledge and skills to eliminate unnecessary cost in the project.

VM derives its power from being a team based, process-driven methodology and has been dominated by the north American thinking since its early days (Male, Kelly et al. 2007) where Americans generally refer to the technique as Value Methodology (VM) which emerged in 1940s as a response to increasing pressure to gain more with fewer resources (Wilson 2005). The origin of first Value Management application can be traced back to Miles a Purchasing engineer with General Electric who developed the first Value Analysis (VA) plan and the Society of American Value Engineers (SAVE), which was founded in Washington, DC, in 1959 as the premier international society devoted to the advancement and promotion of the value methodology (Alalshikh and Male 2009).(SAVE 2007) defined the value methodology as the systematic process used by a multidisciplinary team to improve the value of a project through the analysis of its functions. The application of value management as a formal technique will largely depend on the value of a particular project and the level of risk involved Value management usually incorporates a series of workshops, interviews and reviews, through which the project requirements are evaluated against the means of achieving them. There are many reasons to use VM in projects, one of them is the poor definition of projects at early stage as it is crucial to ensure the project success this poor definition normally comes from the shortage of time given out at that stage, therefore the stakeholders are required to define the project scope and need at early stage (Smith 2002). Beside that there are always elements in the project with poor value and using VM can help remove those elements.

Old Cross Community Fitness Centre Overview

The project under study is the Old Cross Community Fitness Centre which include sport facilities to serve the people of the area, the sport facilities include swimming pools, indoors tennis courts, sport halls, general purpose hall, fitness centre, health suite, dance studio and cafe, the main purpose of this paper to follow the steps the group has made in carrying out VM study for the project, the information about the project has been provided in term of a design brief, a cost plan and set of drawings along with interviews with the project key stakeholders.

Value Management Phases and processes

Normally the process of VM linked with the job plan which was developed for the first times by Miles in 1940, today VM processes do not differ from the original job plan that was released by Miles. A job plan is a logical and sequential approach to problem solving which involves the identification and appraisal of a range of options and according to (Male and Kelly 2004), the VM has been traditionally been built around the job plan and there are many forms of the job plan. A typical job plan may include:

(1) Information: this is the phase where required information about the need, wants, values, costs, risks, time scale and other project constraints are been gathered and collected. The team in this phase review the current project status and clearly identified the goals of the study (SAVE 2007).SAVE International consider the function analysis as a component in the Job Plan while (Kelly, Male et al. 2004) in their revised VM Process consider the Function Analysis as technique that should be used during the information phase of the Job Plan executing.

(2) Creativity or Innovation phase normally the application of techniques like brainstorming in this stage is essential

(3) Evaluation: the evaluation of the alternative options identified in the innovation stage by following structured evaluation process to select the most appropriate options those bring value and assure functionality.

(4) Development: the development of the most promising options with required documented proposal to help decision makers making their choice (SAVE 2007)

(5) Action Planning

(6) Implementation phase: an examination of how the recommendations were carried out in order to provide lessons for future projects (Smith 2002). (Male, Kelly et al. 1998) divided VM study into three faces the orientation and diagnosis phase, the workshop phase and the implementation phase. Figure1 shows the phases and link them to the original VM job plan

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Figure the VM Revised Process-source: Kelly et al (2004)

2 VM Study – A Critical Appraisal for the Group work

The critical appraisal for the VM strategy adopted by the team will look at the different processes of VM study and how the team dealt with it and compare the group work with the best practice and published literature in the field, giving rationale and justify the group trends, highlights the group major disagreement with the VM best practice and define strength and weaknesses behind their choices.

Orientation & Diagnosis Phase- The Pre-Workshop Phase

In this phase of the study the Value Manager should be appointed and normally the Value Manager will held meeting with the clients in order to define objectives of Value Study, gain commitment from stakeholders and agree a bout how the value study programme should be implemented. Meeting with project sponsors and reviewing of documents is likely to happen at this stage along with conducting interviews with relevant stakeholders (Male and Kelly 2004), selection of the participants in the value study and gathering of information is a crucial part in the this phase (Abidin and Pasquire 2007). The structure of the value problems in details and the discussion of possible solution along with the agenda for the workshop phase are important parts in this phase and may also include how the workshop should be implemented (Male and Kelly 2004). In this phase the team decided that more information is needed (documents, contracts, organisation, structure, client requirements, scope and more interviews and reviews), these interviews are required to make it clear about the allocation of fund and the commitment of stakeholders towards the project, the group also discovered the need to interrogate the project to align with strategic objectives and the understanding of the organization structure. In order to succeed it is important to know where is the project in relation to life cycle, other VM challenges/problems that are not stated need to be highlighted. All these requirements are essential in this part of the phase (the orientation).on the other hand the diagnosis also has its requirements, from the location of the site and whether it is suitable for such kind of projects, to the political factors surrounding the project without neglecting the effect of fund diversion and how the facility is going to be used..

2.2.1 Defining the Value Study Style & the Value Gap

VE study refers on the overall process of applying VE on an individual project (PBS 1992). According to (Male, Kelly et al. 1998) the VM study style represent method and approaches those need to be used during the VM workshop, it is the outcome of the stage in the project life cycle at which VM study is carried out and to do so the identification of the project current intervention point is needed. (Connaughton and Green 1996) identified four VM/VE (Value Engineering) intervention stages as follows: concept, feasibility, scheme design and detail design while Male et al. (1998), stated that there is a generally held consensus that the following six opportunities help to achieve the highest effect on any project during a VM study’s lifecycle: the pre-brief, briefing, concept design, Charette (Brief Review Workshop), detail design, and operational study (during the construction phase).

For Old Cross Community Fitness Centre the group decided to carry out a charette giving that OCCFC client as can be seen from interviews and project documents think that they are the concept stage while the team believe that they are at the briefing stage, the difference between clients views about where the project is in its life cycle and VM team views represent the value gap that need to be consider in order to insure the best outcomes from the study, that make charette acceptable to take them back then bring them forward to achieve best value. In this stage the reviewing of procurement route in the project is of great benefits

FIG1.JPG

Figure Value Opportunities- Source: Male et al (1998)

2.2.2 Objectives, Inputs & Deliverables from Study

Part of the O & D phase of VM study is to establish the scope of the study, the constraints, the objectives and the deliverables (Male and Kelly 2004), The group look at the objectives of the study first and reach an agreement that the objectives of the study are establishing the benefits of the investment, achieving the clients requirements in provide the facility, defining the best procurement strategy and procurement route that assure the provision of OCCFC in time and with the desired quality and highlighting the implications of the gap. That is generally match with (Kelly, Male et al. 2004) requirements of this stage. For OCCFC the outcomes from the VM study can be abstracted in the followings:

Assure that the design proposals as presented were accepted by the stakeholders

Develop Design proposal

Provide an extra knowledge base to the client in such type of projects

Define the client value system

5- Highlight the options available to the client in term of building materials, procurement route and risk management.

6- Confirmed the issues and constraints for the project.

7- Identify the assumptions for the project’s planning

8- Highlight possible areas of saving by conducting function analysis techniques

9- Identify the major risks surrounding the project and the best ways to manage the risks.

2.2.3 Value Study Duration & Workshop Agenda

The TAM Manual stated that there is no hard and fast rule concerning duration of the value study apart from the allocation of proper time to each phase of the study to assure getting the expected outcomes from the study (TAM 2001) while (SAVE 2007) highlighted many factors govern the duration needed to execute the Job Plan in a value study: the size and complexity of the project, the stage of project development, the estimated cost of the project while the typical duration for the Workshop Stage is five-days, which does not include the Pre-Workshop (orientation & diagnosis) and Post-Workshop phase (implementation). For the O & D phase the group assumed that the investment and the brief have been sorted and a duration of 15-20 days has been assigned to this phase to allow time for conducting more interviews with stakeholders and cost consultant in particular, this duration assigned by the group seems to be longer as conducting more interviews would not take more than week if the intended interviewees is known and been contacted in advance.

(Hunter and Kelly 2007) stated that there is a difference between study duration on the US and UK as only 1 day is given for the workshop duration in UK while its between 3-5 days in the US which is more compatible with the SAVE guidance in workshop. The group work assigned 2 days to complete the workshop phase which is between the UK & the US practise in regard to the duration of the workshop, assigning one day only to the workshop seems irrelevant because the time that would be given to each step in the job plan may not be enough, the workshop agenda is shown in the bellow figure along with the time assigned to each stage of it.

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Figure the Two Days Workshop Agenda

The implementation phase has been given a duration of 2-3 weeks by the group in order to assure the proper application of the study outcomes, that make the whole duration of the value study almost 6 weeks and according to (TAM 2001) it might be possible to complete a VM Study in few days where the scope of the project, the range of issues or the stakeholder group is small which is clearly not the case in OCCFC .The duration typically required is some four to six weeks which allows sufficient time for the necessary preparatory and information gathering work, workshop, analysis and reporting (TAM 2001), as it can be noticed the group work is in compliance with TAM recommendations in regard to the study duration.

2.2.4 Stakeholders Analysis

A project stakeholder can be defined as a person (or group of people) who has a vested interest in the success of a project and the environment within which the project operates. Stakeholders are all those who need to be considered in achieving project goals and whose participation and support are crucial to its success (Golder and Gawler 2005). For OCCFC the stakeholder groups include the sports council, the lottery commission, the Howarth Trust, The Indoor Tennis Initiative, the NHS, Drug and Addiction Committee, the Kempsy Tennis Club, the local community and the end-users. Although the group work didn’t mention it the ranking of the stakeholders is important to carry out Stakeholder analysis to identify all primary and secondary stakeholders. The analysis of the stakeholders during the definition of the project can be of great benefits while a detailed stakeholder’s may take place during the design phase of the project. (Johnson and Scholes 1999) stated that it is not enough simply to identify stakeholders and proposed a stakeholder mapping technique, the power/interest matrix, in which the power/interest matrix of project stakeholders can be categorized depending on their power towards the project and their level of interest, therefore the VM study team need to assess each stakeholder’s interest to express its expectations on project decisions and if there is the power to follow it through.. The stakeholders of the OCCFC may include other governmental bodies and interest groups those didn’t been identified by the group work which tends to consider the seven main stakeholders as the most appropriate to be invited to the workshop

2.3 Value Management Team & Participants in the Workshop

When considering the team that should conduct the VM study, the first consideration is the solid VM background for the consulting team (PBS 1992), The team can be either external or existing team; the use of external team is not beneficial as conflict may arise between existing design team and external team, in addition to that the using of existing team can help in cost reduction, better development of ideas due to experience within the project, open communication and increased in implementation (Male, Kelly et al. 1998). Building Research Establishment (BRE) stated that the team must represent relevant stakeholders, internal or external facilitator while. The group work choose a team that represent Newton council key members, cost consultant, architect, quantity surveyor, structural engineer, electro-mechanical engineer, relevant stakeholders and two team leaders (facilitators) PBS names them VM coordinators. That selection generally match with (Alalshikh and Male 2009) and (Clancy and Dennis 2004) as they composited the team in this style of study with the Client representatives, end user , design team and project management team. The cost consultant presence in the workshop is essential as the core of the work will be the look out for alternative options in building materials…etc while the architect must be part of the team to review the proposed plans and will contribute crucially during the space analysis exercises. The roles of the structural engineer, M&E engineer and the quantity surveyor can not be eliminated to assure the compliance between the build-ability of proposed architectural ideas, the perfect and proper locations for the electro-mechanical system that will serve the building and the quick and yet effective gaining of required materials list with available options. (Male, Kelly et al. 1998) mentioned five approach of VM study depends on the team composition and the team selected by the group tends to match his VM3 approach, where the personnel are the study facilitator and client representatives together with the project design team The benefits of VM have found to be most effective when an independent facilitator of the consultant/contractor team is appointed (DHS 2010) . The group work did not mention whether those facilitators are independent or not, but still using two facilitators is crucial as the team will split during the evaluation of ideas. (ICE) suggest the team must include all relevant disciplines, have authorised decision maker and be led by value manager without mentioning the size of the team, that explain why Newton Council need to be represented as they are the decision makers.

According to (Hoekstra 2006) most owners lean towards a small 5 to 7 member VE team; one person per discipline, with no duplication, the group trend may be compatible with Hoekstra as the team represents 5 different disciplines if stakeholders , Newton council members and facilitators of the study excluded, Hoekstra also mentioned that the team may include operations, management, ITS, safety, public information, environmental and maintenance disciplines to ensure the coverage of all project aspects. Its clearly noticed that the group work tends to ignore those disciplines although in the size of the team they mentioned that it may reach 16 with variation during the study process without clear identification of the additional members and whether any considerations for other disciplines are taken into account or just that additional proportion of the size was completely assigned to the stakeholders and council members. However this size mentioned by the group is acceptable when compare with TAM Manual recommendation of the 17 members average group size which represent both appropriate multi stakeholders and multi discipline specialist (TAM 2001). According to (Male and Kelly 2004) a team of six to ten people can work properly together and since the group tends to go for large group the management of the team may be more difficult , although the group may defend that by appointing two facilitators in the workshop. It is relevant to mention that, the team has been split during the development and evaluation of ideas and that contradict with (Male and Kelly 2004) recommendation in using the Plenary sessions for more than twenty people team which is not the case here. When it comes to the background of the Value manager, CIRIA recommend the use of value manager who may be either from external organization or in-house (Connaughton and Green 1996). Again the group did not mention that and whether the two facilitators are part of the consultant/contractor team or not.

One important part in the team dynamics is the facilitator and its role during workshop, according to (Kaufman 2006) facilitation is the vehicle that guide the VM discipline into a viable process and there are many different type of facilitation, normally the VM facilitator involved before the project begins , being a part of deciding the discipline required in the VM team and determining the size of the team therefore the facilitator need to be well equipped with managing team dynamics skills, although the group has motioned the need for two facilitators in their study, they did not mention at which stage these facilitator have been brought into the project and that has a crucial impact in the kind of facilitation to be followed during the study. The facilitator should be well equipped with many skills, one of those skills that the facilitator needs is the strong ability to listen in an effective way and that should involves hearing both the spoken and the unspoken words, be able to recognizing body language and gestures, and paying attention to the behavior of the team members (Adams and Nelson 2006).Finally, it is relevant to mention that the level of authority that the Value manager should has through the study is important in this stage and play crucial role (Male and Kelly 2004), noticeably that didn’t been highlighted by the group.

3 The Workshop Phase- Execution of the Job Plan

This is the main phase of the value study where the team should execute the Job plan; normally the process begins with the information phase. The Workshop based on the opportunity to examine and explore the overlapping areas of knowledge and experience between the various disciplines and stakeholders (TAM 2001). At this stage it’s the responsibility of the value manager to insure that the information from the O & D phase is totally shared and understood by his team members. The following paragraphs will look at the tools and techniques used by the group during the workshop and compare them with the best practice of VM. A typical Job Plan showing in Figure 3 along with the four quadrants of the workshop recommended by Steve Male.

FIG1.bmp

Figure the workshop process- the Job Plan

12.bmp

Figure the Four Quadrants of the Workshop

3.1 Information Stage-Tools & Techniques

At this stage the group used various tools and techniques which include Functional Analysis, checklists and priority matrix, the group made some assumptions about the investment in OCCFC and assumed that it has been sorted during the information sharing in the Orientation and Diagnosis phase of the study. The main issue in this phase is how to define the client value system that covered the variables of the triangle of time, cost and quality and stating the project main drivers. According to (Male and Kelly 2004) the main purpose of the tools and techniques used during the workshop is to elicit, structure, restructure and present information to workshop attendees.

3.1.1 Goals & Issues’ Analysis

In order to define the issues those may surround the project a clear understanding of both the client and the end-users requirements is needed. The group highlighted some of the issues those may effect the project from the location of the site it self to the political factors and the time constrain, the diversion of the fund is one of the important issues, the order of the tools and techniques used through the workshop are presented here according to the group.

3.1.2 the Client Value System for OCCFC

Defining the client value criteria is one of the most important steps towards a successful VM study.(Kelly and Male 2006) argued that, while in traditional construction project briefing this is always determined by trial and error by designers, that is not enough and need to include all the variables of time, cost and quality that are measurable, and that why it is necessary to come up with a logical measurement to the value system of the client

3.1.3 TCQ Triangle

As part of the VM study it is important to use the TCQ triangle of time , cost and quality according to their priority to the client and normally that happens before doing the analysis of the client value system because the latter contains all the variables needed to determine the client value criteria, and according to (Kelly, Male et al. 2004) the Value Manager usually ask for commonly agreement within the team about the position of the dot in the triangle which shows which of the three variables is the most important for the client, the group work did not identify the most important value variable within the triangle and just mention TCQ as technique that should be applied, also the group work did not justify the reason behind using this technique, and it can be said that the most driving reason for this technique during the information stage is the necessity to reach consensus about the value system used by the client ,TCQ Triangle along with explicating the variables of quality and value can help in achieving that. A noticeable feature of the group work is that they put the defining of the client value system before the TCQ triangle which contradict with the logical sequence taking into consideration that defining the client value system rely on the explicitness of the quality and value variables that why defining the client value system should follows the TCQ triangle when it comes to the orders of the techniques.

3.1.4 Function Analysis

This is core element in the information stage where the purpose of the project and its parts is well understood by the team member before going further. It’s the identification and ranking of primary and

Secondary functions and their associated cost and worth relationship, the techniques normally begin with the more higher functions of the client system and then move to specific functions of lower level

components (TAM 2001) and that why it should be applied. In addition to that function analysis is a powerful technique that constantly asking why and what (Male and Kelly 2004) , going back to basics offers the opportunity to identify value mismatches and by following these steps the group has determined the want and needs (the Function Priority Matrix) of the project in order to compose the Strategic Fast diagram, the group work focus heavily in the strategic level of the project without going into the tactical an technical level; their outcomes can be shown in the following table

Provide Health & Fitness

Provide Leisure & Recreation

Assure Society Improvement

Maintain Quality of Life Improvement

Create Future Athletes

Offer Employment Opportunity

Needs

Wants

Table Project Function Priority Matrix for OCCFC

As can be shown from the table, the group tends to look at the project at the strategic level only (the business project) without going into the tactical level and technical components of the project. According to (Male and Kelly 2002) refinement of the above may come through debate to produce the FAST diagram and one of the major problems with the group work is that the Wants and Needs list is not an explicit one that cover all the aspects of the project apart from the needs which reflect the main purpose behind OCCFC. This should be followed by the strategic FAST diagram to determine the level of each of the function within the project.

3.2 Creativity Stage

The group mentioned the brainstorming as the main technique to be used here to identify other way to perform the functions within the project, this has been done by splitting the team into two groups during study, because it is recommended that where there are more than seven or eight people in the study(the group has a team of 16 members), it is useful to generate ideas through small groups and then to hold plenary sessions in which all ideas generated are identified and discussed(TAM 2001).Applying brainstorming without criticizing the team members’ ideas can create new ideas and options

3.3 Evaluation & Development Stages

According to (SAVE 2007) normally in this stage the team will develop the selected ideas into proposals with a sufficient level of documentation to allow decision makers to determine if the alternative should be implemented , the group tends to evaluate the options based on the technical viabilities, the client acceptance and went for the economical options after evaluating the options available. Normally the ideas are evaluated in terms of the advantages and disadvantages they offer to the project and provide and assure value improvement.

This includes those ideas that, in spite of additional capital cost, could lead to a better return on investment (TAM 2001) and that contradicts with the group trend in adopting the most economical options. It is also common in this stage to avoid ideas that might lead to perform a re-design (TAM 2001) and the group trend may be compatible with that as they did not mention the necessity to re-design. In some cases, when the time is the most important variable within the client value system, it may be so difficult to make change during the development stage of the project (TAM 2001) which is not the case here in OCCFC as the project still in the concept stage. The group work barely defined the available options in term of material and procurement route that suit the project. The time assigned by the group to perform the evaluation and development may be questioned too as the group only allowed 2 hours to carry out both the development and the evaluation of ideas which is not enough to do that considering the team will split to allow the capture of more alternatives then will reunite to perform plenary session, to assure the best outcomes of this stage the group choice stayed at the middle, so developing part of the options in this stage is possible along with leaving some of them to be transfer and presented in the action plan stage and that is in compliance with TAM Manual recommendations (TAM 2001).

3.4 Action Plan

4 Value Management Study Environment

Many consideration should be given to the environment within which the VM study should be performed as that greatly affect the outcomes of the study, in order to achieve the purposes of conducting such study the consideration of the place where the value study should be held is one of the important factors as people tend to perform more freely in off-work environment. The atmosphere of the study it self is of crucial important like the dress of the people in casuals may add the sense of doing things out of the office or job work and make people more comfortable and focusing

5 Implementation Phase

Implementation meetings

Implementation review

Duration- 2-3weeks

6 Conclusion

The paper


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