There has been increased level of challenges faced by the management accounting in the last decades to espouse new approaches that are designed to fit the changes in the fiscal setting and to correct perceived inefficiencies of the controlling structures. An important debate focussed on the character of information for decision-making and a group of scholars addressed the issue whether the contribution margin approach was superior to systems that fully allocated overheads. Furthermore, the topic of residual income and the optimal control of relatively autonomous divisions was an added topic in the 1970s upon which several researchers congregated. Value management is yet another recent matter in practice, which is claimed to be changing financial management at the highest levels. The intent of this study is to assess the potential of the value management framework in order to ensure that the resources of an organization are effectively utilized and exploited in an efficient manner in order to achieve the organization's prime objectives. The actual meaning of value within a particular context agreeing on a clear statement of objectives and ensuring that the obtained solutions are consistent with those objectives can be termed as Value management. It is not a single method, but a framework within which proven methods are systematically brought together to identify better value from projects, products and services. It can be further described as a structured, analytical process for developing innovative, holistic solutions to complex problems.
1.1 DEFINING VALUE MANAGEMENT
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There is an ongoing polemic regarding the metrics that should be used however, most definitions of value-based management are a sign of the same way of thinking constituting that Value management is a style of administration, particularly dedicated to organize people, develop their skills and promote synergies and innovation, with the aim of maximising the overall performance of an organisation. Following are some definitions of Value management based on assorted studies:
"Value Management is a prescribed and usually repetitious way of carrying out an activity or a set of activities that propagate its values all over the organization. It is a robust disciplined process that is meant to be apparent in the heart of all business decisions" (Morrin and Jarell, 2001)
"Value Management is essentially a management approach whereby companies' driving philosophy is to maximize shareholder value by producing returns in excess of the cost of capital" (Simms, 2001).
"The founding principle underlying Value Management is the discounted cash model of firm value. However, VM is more than a performance measurement system. Proponents argue that if it is to be successful it must be used to tie performance to compensation. The guiding principle underlying the use of VM, then, is that measuring and rewarding activities that create shareholder value will ultimately lead to greater shareholder value"(Martin and Petty, 2000).
"Value Management is a nutshell, the key to increased shareholder value lies in the integration of strategic planning, performance measurement and compensation" (Leahy, 2000).
Value Management is a holistic management approach that encompasses redefined goals, redesigned structures and systems, rejuvenated strategic and operational processes, and revamped human-resources practices. Value Management is not a quick fix but a path requiring persistence and commitment" (Boulos, Haspeslagh and Noda, 2001).
1.2 UNDERSTANDING OF THE VM CONCEPT
In accordance with the theory of Value Management, project objectives can be achieved by following a chain of processes and it's not necessary that only a single way might lead to achieve the objectives rather a multi faceted approach is required which in value management that may involve more than one technique to achieve project objectives. It is also important to note that by examining several alternatives may result in producing the most satisfactory conclusion. Therefore, value management is considered as a structured, systematic and analytical process that is desired to pull off almost all the necessary functions at the lowest total cost consistent with required levels of quality and performance. The process of value management incorporates the analysis of functions including the relationship or cost impact of design decisions on the project or scheme operation and this aspect distinguishes the process itself from various other methods of improving value. Function analysis is meant to identify what should be done to attain the prime objectives of an organization and with the help of function analysis various factors can be identified that may include wastage, duplication and unnecessary expenditure giving opportunity for value to be improved. The functional analysis perspective enables to explore the project to test the assumptions and needs perceived by the stakeholders. Value Management is not a review process, but a means to assist in the better management of the procurement process and the concept of value as used in Value Management distinguishes it from conventional methods of cost review by considering the relationship between function, cost, and worth.
1.3 IDENTIFICATION OF VALUE
Always on Time
Marked to Standard
In accordance with the theory of Value Management, value is the level of importance that is placed upon a desired function, or combination of functions as indicated by the given formula:
Table: 01 FORMULA
Value = Function OR What you get (or want)
Whole Life Cost What you pay
The value is overt through the mutual agreement upon a clear statement of project objectives by all the stakeholders of a project. Function analysis is the core element of the Value Management process, by which the value of a project can be determined. The main objective of the process is to increase the value of the project and not to reduce the overall cost whilst it would be advantageous to identify the factors of cost savings along with the identification of value improvements that may eventually result in increasing the project cost. Once the primary objectives of the project have been clearly identified, the value engineering or the value management study is initiated to discover the costs associated with a project. Best value is the best possible compromise that can be achieved between all the competing objectives of the various stakeholders to the project (*).
1.4 COSTS AND BENEFITS OF VALUE MANAGEMENT
The process of value management is an exercise that results in lower level of costs and gaining higher level of benefits. Upon early integration of the value into the project management methodology, the overall cost of the project can be almost negligible, because of the reduced need for subsequent reviews and opportunities for substituting VM for some of the routine appraisals and quality audits that are always necessary(*). Apparently, the
the benefits of a Value Management reviewed are often perceived in terms of improved quality and reduced cost of the project however the other benefits associated with the value management process might be unseen but are more valuable. For better results of the project consensus and mutual understanding between stakeholders is very crucial and the objectives of the project shall also be clarified on both ends. This requires adopting an approach that reduces the risk of changes in scope and improves communications at both ends to ensure the business plan objectives are met and the project is completed within the specified timeframe.
Followed by several factors the main benefits of the value management is to resolve the
ambiguities and misperceptions about the project, it clarifies and define roles and responsibilities of the contributing members, tends to improve the project management team and client relationships by opening improved channels of communication and further enhance the value culture. When Value Management process is applied to the operational part of the project it provides a firm structure to shape new practices and procedures by demonstrating the true cost of operations and highlighting non productive factors or high cost elements that shall be excluded. Apart from time saving, it also enhances understanding of the true costs and functions of operations and improves the ability to contribute to cost management by increasing competitiveness.
1.5 MITIGATING RISK FACTORS
The potential risks should always be considered within a Value Management study encompassing all the possible issues and problems that may cause impediment in the successful progression of the project. Firstly it requires the evaluation of ideas for improving value of the project to be discussed as a separate matter of the Value Management workshop in order to identify and assess the probability and relevant impact of the associated risks.
A separate decision matrix shall be formulated by the selection of several options to identify the potential issues and address them alongside the output from the value decision matrix. A separate Risk Workshop can also be conducted in a similar fashion to that for a Value Management workshop starting from the information phase that represents a collection of probable risks, followed by their evaluation and quantification and further developing a clear and concise strategy to mitigate risk elements and finally formulating an effective plan in response to potential risks of the project. The Value Management process is itself considered to be a risk management process as it tends to develop a mutual understanding between the stakeholders by developing the project learning activities and workshops in the earlier stages of the process. Furthermore, the value management process challenges the assumptions, generates alternatives and promotes synergy amongst the contributing members and there by identifies and targets the associated risks to the project.
THE VALUE MANAGEMENT PROCESS
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Value Management (VM), is a systematic and structured process of team based decision making. It aims to achieve best value for a project or process by defining those functions required to achieve the value objectives and delivering those functions at least cost (whole life cost or resource use), consistent with the required quality and performance. VM is undertaken as a series stakeholder workshops held at key stages during the development of the project or review of a process or service. It is a flexible, team-based activity, planned and directed by an independent VM facilitator and driven by consensus. The workshops are short duration (usually 6 hours to two days), intense and highly structured. The process works top-down, starting with needs and strategic goals and focusing on root causes, not symptoms. An early consensus is developed between the key stakeholders about the need for the project or service, the scope, deliverables, key functions and risks, in the context of the wider business objectives. Opportunities for innovation are explored and the most cost effective means of implementation developed, consistent with desired time and quality requirements. VM considers the whole project rather than components and the process is underpinned by consensus. Team selection for the workshop is crucial to success; to ensure that the full range of influences are properly addressed by people with the right balance of knowledge, skills, experience and judgment. Where particular stakeholders are not able to take part, or it is not politic to involve them, specific team members should be tasked as champions of those stakeholder interests. There are no imposed solutions, the outcomes and decisions are those of the team, resulting in total ownership by the team; improving the prospects for implementation and avoidance of scope creep.
2.1 KEY CHARACTERISTICS OF VM PROCESS
Following are the key characteristics associated with the process of Value management;
Systematic and a staged approach
A specific methodology with a clear objectives
Effective use of methods and tools
A creative problem solving approach
A workshop format with a structured job plan
Multi-disciplinary team effort
Involving key stakeholders in a managed team approach
Focussed on function analysis
Focussed on achieving value-added solutions
Based upon an integration
Focussed on project learning
2.2 THE DURATION OF VALUE MANAGEMENT STUDY
Considering the duration of the value study process, sufficient time of about two week has been allocated to ensure all six phases are appropriately addressed. Table: 02 indicate all the key activities of the workshop distinctly specified in accordance with the number of days separately allocated for each activity.
TABLE: 02 VM STUDY SCHEDULE
Discussion on functionalities; scope of work and budget of the project. Architectural Engineer visits the facilities to understand the functionality of the new facility
Discussion on FAST diagram and operational activities.
Value analysis job plan
Development of design alternatives
Rough floor plan and site plan are developed.
Review on technicalities and functions
Review of floor plan and site plan
Brainstorm design alternatives
Architectural Engineer substantiates the design
Final review of the primary design and design alternatives
Estimating the cost
Function analysis to prioritize cost reductions
Cost reduction exercises
Coordination of the different aspects of project design
Compliance with functions
Graphic presentation of the design
Draft of the Final Executive Summary
Design is now complete to the 10% stage.
Development of formal design
Mutual discussion of all key stakeholders on the issues pertaining to the project design and its functionalities
Formulation of revised and flawless plan
Approval of final drafts
Depending upon the scope of the project, the range of issues and the size of stakeholders group, there is a possibility to squeeze the duration of value study in between three to five days but if the project scope is larger than the duration of value study can be extended. The overall project management strategy can espouse the value management process which can be used as a long-term management strand. The timeframe or the duration of study requires four sufficient times to carry out necessary preparatory work, workshop, analysis and reporting for the successful completion of project within the anticipated timeframe. The total time proposed by the contributing members of the value management study, is approximately 08 weeks, which has been represented by the Gantt chart as follows:
Three weeks have been proposed for the Phase o1 i.e. the Orientation and Diagnostic Phase which forms the grounds for the workshops.
Further two weeks are suggested for the Phase 2 which is the Workshop. A detail outline of all the key activities of the workshop has been identified in Table 02.
Three weeks more are suggested for the final stage i.e. The Implementation of the project.
Table: 03 GANTT CHART
PHASE : 01
ORIENTATION & DIAGNOSIS
PHASE : 02
PHASE : 03
2.3 VALUE STUDY GROUP
A contrasting group of people representing the various stakeholders and other key individuals associated with the program or project come together to formulate a work study group in order to analyze every possible aspect of the project prior to its commencement. The composition and selection of the value study group is of fundamental importance as it will have a major impact on the decision-making and the successful completion of the process. The main intention of forming a value study group is to gain the appropriate multi stakeholder and multi disciplinary representation focussing on the project and the size of the group averages in between fifteen to eighteen people approximately depending upon the requirement as the number of participants is kept restricted due to practical reasons. The participants of the value study group are categorized as follows and Table: 02 distinctly represents all the contributing key stakeholders.
2.3.1 Executive Management
For the purpose of offering the value study team with a corporate benchmark for maintaining focus of the study on the project, there is a need for an overt commitment by Executive Management which will greatly enhance the progression of value management process. For the value study of Wastewater Plant of Glasgow the executive management is advised to attend the initial sessions of the workshop. The Chief Executive of the local Council and representatives of the Municipal Government authorities consequently form a substantial constituent of the executive management team of the value study.
There is a need to highlight all the relevant issues ranging from program rationale to detailed project function requirements which are keenly analyzed and addressed by the help of the program agency representatives. The participation of a senior member or representative is required from the Agency as for instance, the Director of Urban Administration Planning and a representative of Environmental Protection Agency would be a great help to identify any potential hazards to the environment. During the first half of the workshop all the essential objectives and rationale are being examined by the senior executive of the agency. For the entire workshop sessions the participation of senior members of Agency representative is essential in order to advise on functional requirements from an operational perspective and shall also contribute to identify various alternatives based on functional assessments.
2.3.3 Project Consultants & Design Team
The key players contributing to the structural model and design of the project are also required to participate in the value study. It is the prime responsibility of the project Consultants and the Design Team to provide background data on the project evolution from their specialist standpoints. They also identify the key issues or concerns and based on their assumptions the design decisions are greatly influenced. The Structural Engineers, Contractors, Member of Civil Construction Bureau and Design Engineers, with the help of their detailed knowledge can provide innovative ideas with in-depth analysis of structural and design based components and also present alternatives for further improvement.
2.3.4 Value Assessment Team
The main objective of the value study of any project is to determine the value based aspect of the overall project and management process. The value assessment team members have varying roles and levels of management throughout the value management phases by participating throughout the workshop session to provide the structure and independent level of enquiry, probing and discussion on the value assessment of Wastewater Plant of Glasgow Industrial Park. The representatives of Financial Bureau, Municipal Public Utilities Bureau and Cost Estimators shall contribute in the facilitation, organisation, reporting, and technical independence of the workshop phases.
2.3.5 Engineers and Technical Specialists
It is beneficial to invite the technical engineers and specialist teams from the initiation of the workshop phases as they facilitate throughout the entire project by identifying all the technical glitches that may arise later. The information provided by the Technical Specialists i.e. Engineers from the Sewer Corporation and Mechanical Engineers add an extra dimension to the study process and also enhance the level of incisive review and analysis in the value management process.
2.3.6 Other Contributing Members
The various other participants like, secretaries and recorders also contribute to the workshop by taking meeting minutes encompassing each and every single phase of the entire workshop sessions.
2.3.7 Excluded Participants
There are several members of the project that are being excluded from the value study as their presence has not been considered mandatory during this phase of the value management process. Following is the list of participants excluded from the study group:
Security In charge - presence not required at this stage
End users - are excluded to avoid political issues
Electrical Engineers - their presence is of general importance at this stage
Health and Safety Officers - not needed at this stage
Representative of Public Service Commission - Council members are already present
Representative of Water Supply Corporation- A senior executive has been included
TABLE: 04 LIST OF KEY STAKE HOLDERS
Director of Municipal Government
Chief Executive of Area Council
Director of Urban Planning Administration
Director of Environmental Protection Department
Representative of Municipal Public Utilities Bureau
Member of Civil Construction Bureau
Sewer Corporation of Glasgow
Executive of Glasgow Water Supply Company
Member of Public Health Bureau
Representative of Financial Bureau
Member of Provincial Institute of Environmental Sciences
Representative of Contractors
3. THE VALUE STUDY WORKSHOP
The entire project encompassing all the essential phases of the plan are critically discussed, evaluated and addressed in the value study workshop. The workshop serves as a pivotal phase and a common platform to gather all the key stakeholders in order to get the most out of their contributions by illustrating the combined knowledge of the entire panel of stakeholders. The workshop also addresses the notion of maximising the benefits of group dynamics rather than the same people working for a single project might act in segregation which may result in lesser advantage. Another significant aspect of conducting workshop study is to ensure that the effective involvement of all the participants has been carried out by achieving most out of their contribution into a short duration of time. All the participating members are required to demonstrate utmost time commitment for the entire workshop session. Furthermore, the process of conducting the workshop capitalises on the opportunity to explore the overlapping areas of knowledge and experience between the various disciplines and interests groups of the key stakeholders. Figure 01 reflects the benefits of the participation and knowledge expertise overlap obtained through the active participation of the members.
Figure: 01 WORKSHOP INTERACTIONS
Workshop Interactions: Overlap of experience and knowledge
3.1 PHASES OF VALUE STUDY WORKSHOP
An international benchmarking study of value management was conducted by Kelly & Male (2004) in the period between 1996 and 1998, to develop a better understanding of international views, tools, techniques, and styles of value management process and as an outcome the value management study is divided into three main stages including; the pre-workshop or the orientation and diagnostic stage, the workshop stage, and the post-workshop stage as indicated in Figure: 02; This section provides an overview of the Value Management process, which has been specifically tailored to address the needs of Wastewater Plant in the Industrial Park of Glasgow.
MODEL OF VALUE MANAGEMENT
The VM Model of Wastewater Plant of Glasgow Industrial Park
The step by step phases of the workshop sessions are capable of analyzing the earliest concept stage, with multi stakeholder participation. The model of value management for Wastewater Plant of Glasgow Industrial Park as presented in Figure: 02. All the elements of the traditional value management process are incorporated within the same model followed by all the three main stages from the initiation to the evaluation and finally till the implementation of the entire project.
PHASE: 01 ORIENTATION & DIAGNOSIS PHASE
3.2 INFORMATION PHASE
One of the most crucial phases of the value management process is the information phase in which information is gathered to provide directions and propose solution to the issues that may arise during the progression of the project. The successful commencement of a project is dependent on this phase as it covers all the aspects and essential information that is required to formulate a meaningful and cost effective plan. The information phase is primarily segregated into two main activities that can be categorized as Scope and Logistics. This is the phase where the actual workshop begins and all the contributing members and key stakeholders present an outline of their perceptions and the consolidated background material gathered during the pre-workshop stage shall be put forward. The background material includes relevant data concerning the corporate, regional, area and project objectives. As the workshop phases progress the value judgements, and the rationale of the value study underpinning the proposal are being considered and appreciated where applicable. The workshops provide the opportunity to explore the rationale of the project which is being enquired from a functional viewpoint. Moreover, cost effective alternative methods and solutions to the issues are also provided. This phase provides an opportunity to spot the assumptions made during the project development process by all the stakeholders.
3.2.1 Scope of the Study
It is imperative to identify the scope of the project and establish the focus and bounds of the value management study to get a clear picture. The information that is gathered, assessed, and consolidated, forms the foundation for all subsequent analysis. The key activities include; canvassing the issues and concerns and noticeably institute the objectives of Value Management Study. An ongoing benchmark can be established and a focus can be maintained if the objectives of the value management study are clearly identified. To evaluate the outcomes it is necessary to outline the objectives in terms of their consistency with corporate or service strategies. Furthermore, preparation of background material is required to represent a synopsis of the value study. This phase also identifies the perspectives of the key stakeholders and all other contributing participants. The prime aspect of identifying the scope of the study is to recognize the issues and areas of conflict and note down the assumptions by the contributors in order to address the functional requirements of the project.
Information phase is the initial step to the workshop and therefore, each and every possible aspect shall be studied during this particular phase. However, to study the scope and gather information there is a strong need to determine the logistics which play an integral part for the successful completion of the workshops. Starting from the formation of Value Study Team including the Executives, Government Officials and technical specialists; a timetable shall be set out and time commitment of stakeholders shall also be attained. In addition to this, starting from nominating and inviting the participating members; the arrangement of venue also comes under the logistics phase. Furthermore, the consolidated background material, along with projectors, markers, seating, lightings and every minute aspect shall be covered.
3.3 FUNCTION ANALYSIS PHASE
Being an integral part of the information phase of the value management job plan the function analysis phase involves identifying the functions of each individual elements of a project. The descriptions of each function are masked by technical terms and the language is converted into simple and easily understood statements expressed in simple verb or noun terms are assembled in a logical hierarchy to form a diagram shows how the project objectives are achieved. The techniques which are developed to identify and analyse the functions are presented in a sequence based on their functional hierarchies by the use of Function Analysis System Technique (FAST). The diagram provides the outline of each function of the entire process on the basis of which alternatives may be generated and evaluated to eliminate or combine functions, and to ensure compatibility between functions within the whole system. Furthermore, the functions are split into primary and secondary stages. The primary functions are those that are critical to success followed by the secondary functions which serve as a support system to the primary functions. The relative importance of the project functions can be identified by applying the weightings to the functions and the relative costs can be calculated to further propose the alternatives for improvement. The wastage, duplication and necessary expenditure can be identified through the strict analysis of function. The team discussion forms the ground for sketching a valuable diagram to show the flow of the functions. The team discussion improves understanding of the different perspectives and highlights any misconceptions amongst the team members. The represented diagram may not be as detailed as a traditional FAST diagram, however it is sufficient to identify functions and assign order of costs for the Wastewater Plant of the Industrial Park of Glasgow.
3.3.1 Function cost analysis
Cost alone is not considered to be an adequate means of identifying areas of poor value within the value management process. Through the function analysis process and FAST diagram a comparison of the value of functions and their cost can be made which can indicate the potential areas for cost savings without being detriment to function. By identifying the disparities between cost and worth, excessive costs are revealed where worth is defined as the lowest cost to achieve a function. In practice worth is ascribed by the team from experience and is an approximate guide to highlight significant areas of poor value. The ratio of cost to worth is known as the value index.
3.3.2 Function Analysis System Technique (FAST)
The logical way of describing and analyzing the functions of a project is to sketch or outline the activities and this can be done by a FAST diagram (Figure 1). The diagram explains all the activities that have been conducted during the project. From right to left, the diagram indicates why the work is being carried out and from left to right the diagram indicates how all the activities have been carried out. The architectural and mechanical engineers mutually analyze the functionalities and technical aspects of the project as applied in the design while sketching the diagram. The budgetary restrictions and cost-effectiveness of the project is also one of the prime focuses while presenting the FAST diagram. The total breakdown of all the activities and process is being presented in the FAST diagram by closely linking the how and why factors. While assessing the FAST diagram, the logic behind the linkage between how and why can be identified as for instance, Figure 01 represents why there is a need to commence this project which is answered by the how portion indicating that how the discharged effluent has been received then treated and further clarified. All these functions are closely linked in a cause and effect bond that can be represented via a flow diagram such as the FAST diagram. The reverse direction i.e. from left to right indicates how a particular work task is initiated which makes it obvious that the liquid is first sterilized, aerated and recalculated to remove the debris and solid particles in order to process it further to dry the sludge finally removing it. The FAST diagram is not just the only tool but is one of the major analytical tools used in value management process.
Figure: 03 FAST DIAGRAM
REMOVAL OF SLUDGE
The hierarchal flow of activities adapted from Dell'Isola (1982)
PHASE: 02 WORKSHOP PHASE
3.4 IDEAS & INNOVATION
The ideas or the innovation phase provides an opportunity to the contributing members of the workshop to propose alternative ideas to achieve value improvement. Brainstorming and lateral thinking is encouraged to produce as many ideas as possible even if the ideas may sound impractical in the initial stage. A set of questions is the ultimate way to solicit better and much innovative ideas. There are several other ways to structure the value study to facilitate idea generation however; the methods may vary depending upon the size of the study group and the nature of the project. For covering each and every aspect of the project, it is essential to study the various parts of the project specifically targeted for idea generation.
Considering the size of the value study group plenary sessions are held in which all ideas generated are identified and discussed to reach a mutually agreed finale.
3.5 EVALUATION PHASE
Right after the innovation phase, each idea and possible options as generated may need to be carefully evaluated in detail in terms of the advantages and disadvantages they offer to the project with respect to value improvement inclusive of ideas that may cause additional capital cost but could lead to a better return on investment. At this stage the study group can discard all the ideas that might lead to additional re-design or may cause the disruption of the program as the time is a crucial factor and the re-designing may serve as the scratch level to start off from a new beginning which is not required during the development process. However, within an acceptable time frame such ideas can be incorporated within a project development process. There is a wide range of evaluation tools to assist in the evaluation process for example, Priority setting matrices and Evaluation Matrices.
3.5.1 Priority Setting Matrices
The priority setting matrix can be used to determine the relative priorities of a list of objectives or project criteria as per client's viewpoint. The matrix involves considering a pair of criteria at a time and taking decisions as to the relative priority of each criterion followed by the nine essential elements including capital cost (CAPEX), operational cost (OPEX), time, politics, environmental impact, exchange, flexibility, esteem, and comfort (Figure: 04). These matrices are especially beneficial when considering issues at the earliest stages of project development however, they can also be employed to rank detailed design criteria.
Figure: 04 PRIORITY SETTING MATRICES
Source: Kelly, Male, and Graham (2004)
3.5.2 Weighted Evaluation Matrices
A detailed set of proposed ideas shall be notified and prioritised and the ideas with most potential are developed to a stage to show if they are workable. This may include preparing detailed drawings and cost estimates. Weighted Evaluation matrices are used to evaluate a range of solutions to address a particular problem by the weighting and scoring process. The selection of particular nature of the project determines their utilization within the evaluation phase. Each proposed solution or proposal has to be considered and further evaluated against a pre-determined set of criteria which have been ranked in order of importance using the prioritising matrix. Quite subjective data can be analysed on an objective basis by using the weighted evaluation matrices. Each and every idea or innovative point as presented by the contributing member of the value study group is individually analyzed and if found workable then compared with a set of other practical concepts and weighted accordingly. Figure: 05 demonstrate how the ideas are evaluated by using Weighted Evaluation Matrices during the evaluation phase of the study.
Figure: 05 WEIGHTED EVALUATION MATRICES
Weighted Score of
Potential Solutions Total
1. Performance Rating
2. Performance Rating
3.6 ACTION PLANNING PHASE
After critical evaluation of all the possible aspects and alternative designs and concepts the final action in a workshop is the preparation of the Action Plan, which encapsulates the study outcomes and provides a framework for subsequent tasks essential for decision-making process. This phase encompasses the consensus based on all the contributing members' and the stakeholder's viewpoints based on the potential concepts and ideas that have been considered as workable by all. This phase includes the presentation of all the ideas that has been critically assessed in front of the client for approval so that an action plan shall be based on mutually agreed set of ideas. The target dates for each task shall be identified and individual participants shall be nominated to take responsibility for the pursuit of the identified tasks. The action plan when formulated can be successfully implemented followed by keeping higher standards of quality and efforts. It is significant to list out all the activities and tasks to be undertaken and list of responsible people identified to take up those tasks. A specific deadline or time frame shall also be allocated to each activity as the client perception is to achieve maximum results within a shorter period of the time; on the other hand the design team is focussed on the quality aspect and hence the action plan shall address all these aspects based on the perspectives of both sides as indicated by Figure: 06. Approximately after a month of the value study workshop, a follow up session shall be called to discuss any issues if applicable and overall study the progress of the project. In order to ensure that all value improvement opportunities are being pursued fully and to determine further actions, the implementation schedule shall be critically examined.
THE TIME, COST & QUALITY TRAINGLE
CLIENT PERSPECTIVE DESIGN TEAM PERSPECTIVVE
Source: Kelly & Male, et al. (2004)
PHASE: 03 IMPLEMENTATION STAGE
3.7 ANALYSIS AND REPORTING
The project stage determines the reporting requirements for value studies that considerably vary depending upon the phase upon which they are conducted. The reporting requirements become very crucial if the value study has been undertaken at an earlier point of the project.
Value Studies invariably deal with a multiplicity of factors and establish the project framework and direction hence, the analysis and reporting needs to document all relevant issues that are being dealt with during the value study. The period of relevance of these findings, equates to a benchmark to monitor the progression of the project. It is essential to integrate a formal follow-up reporting session which is beneficial to maintain the ongoing focus on the value management process.
3.7.1 Interim report
An interim report shall be submitted by the value study team approximately two weeks after the Value Study Workshop to provide the Action Plan nominees with a rationale of key issues thereby assisting the Action Plan nominees to overcome the issues. The report content should include the value study findings, the rationale and objectives covering all the key aspects of the project, outlining the scope of both the project and value study and a summary outline of key functions with system implications. Furthermore, a brief description of value improvement options along with the outline of the Action Plan shall be included.
3.8 FINAL REPORT
Followed by the interim report which encompasses all the minute details from the initiation till completion of the workshop, a final draft is prepared after the follow-up meeting. The final report provides a detailed record, commentary and distillation of rationale to the
Project Management and the client clearly specifying the outcomes of the follow-up meeting and executive summary of the value management study. This final report provides a benchmark to monitor project development in terms of ensuring alignment with agency corporate goals and design development reflecting the concept philosophy. The presentation of final report is the indication that the value management of the Wastewater Plant project has been successfully achieved. The final report endorsed by senior management and all the key stakeholders, provides the Project Manager with a solid base on which to construct the project management plan and implement the project. It also gives independent project assurance and an audit trail to senior management and key stakeholders.
The entire value management process and the effort involved in analysing the critical factors of the project may become meaningless if the proposed set of ideas and accepted recommendations presented in the final report are not implemented effectively. It is also important to note that if the implementation phase is delayed the feasibility of the proposed recommendations in the final report becomes dubious. Right after the submission of the final report to the key stakeholders, it becomes the top most priority of the Review Board to study the report and speedily come to a decision for the disposition of a Value Engineering proposal. In addition to this, the review team shall direct the responsible staff to implement the accepted proposals with an immediate effect to avoid any possible delays that may cause predicament to the progress of the overall project. During the implementation phase, there is a possibility that the designer will determine that an accepted idea is not feasible for factors not previously known to the Value Engineering team and the Review Board, this might happen on a rare occasion; but if the such situation may arise, then further review of the final report shall be obligated. The implementation phase is the outcome of the detailed information being critically examined and further evaluated within exhaustive sessions of the workshops in order to mitigate every possible issues that may arise later, therefore, the implementation phase is the finale of the entire exercise and to avoid any discrepancies within the final report, it is imperative for all the participating members of the value study to be consistent in their efforts.