Value Management Seminar - 6th March 2012

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Posted by APM on 15th Apr 2012

The SWWE Branch was pleased to have worked closely with the APM Value Management SIG to organise this one day hands on seminar explaining what Value Management is and how it works through a number of interactive case studies. 55 members really enjoyed the day at BAWA, North Bristol, working together in groups to explore and have a go at the Value Management process and techniques.

Martin Gosden, APM SWWE Branch Chairman welcomed members to the seminar.

Peter Langley, Value Management SIG Chairman kicked the day off with an introduction to Value Management. Peter started off with what is Value? BS EN 12973:2000, defines Value as the Satisfaction of Needs, the expected benefits as stated in the business case, together with different stakeholder requirements, (cost, time, quality / functionality), divided by the Use of Resources, both money and time. Stakeholders often have different value judgements and priorities and a VM approach aims to reconcile different priorities to deliver the best value for all stakeholders, balancing benefit delivery with cost and resources.

So, what does it do for a project? VM helps promote a greater understanding of the total project with all stakeholders: the what, why, when, who and how. It focuses on what is needed to be achieved, developing a realistic scope, removing that which is unnecessary together with the associated costs. In so doing it improves design, outputs and reduces cost. VM is primarily used in the project concept phase to define the problem and in project definition phase to agree the solution. Effective VM is about clearly defining the problem before considering solutions. Value Engineering is used in project implementation to fine tune the design.

Peter described the VM process: Information phase, Functional analysis phase, Creativity phase, Evaluation phase, Development phase, Reporting / presentation phase. Peter emphasised that typically the process was rarely completely linear, and is often very iterative, needing to revisit phases.

Peter, and John Heathcote, also from the VM SIG, then led delegates through a series of interactive syndicate exercises to explore the VM process against a case study of a charity event.

The Information phase is about getting every one up to speed on the project background and business case and a joint understanding of different stakeholders views of expected value. Useful techniques include interviewing stakeholders before a workshop to understand their interests and priorities as well as Stephens presentation method, which allows each participant 5 minutes to have individual say, and asking participants to show where they place priority on the time, cost, quality triangle. As an exercise, delegates were asked to pick a charity and explore what each stakeholder might want and need.

The Functional analysis phase asks what does it do, rather than what is it. An example is a chair what does it do? It supports weight, lifts you off the floor, stacks, is cleanable, etc. A useful technique is a How / Why diagram. Starting with why, keep asking why? to find the real reason for doing it. Then ask how? to work out what to do. Describe with active verb and noun. Using the charity example, delegate tables were challenged to try the why and how questioning approach, before sharing ideas in plenary. Examples included Why have a charity event? to attract people, to have fun. Why? to raise the profile, to raise funds. Why? to benefit the charity. Why? to benefit the people the charity is trying to help. You can then look at ideas for the how for each why statement.

The Creative phase is designed to open up options and ideas and most importantly not to prematurely dismiss any before the evaluation phase. The aim is to creatively generate as many solution candidates as possible, thinking out of the box and not dismissing any ideas no matter how wacky. John took the group through several techniques to help generate ideas, including brain storming, de Bonos lateral thinking techniques of random word association, provocation and six thinking hats. Provocation involves listing what you take for granted and then set up a provocation to remove, reverse, or wishful think, outrageous alternatives.

After lunch, delegates were given the Tardytravel Bus Company case study which they practiced the Information and Functional analysis phases on. They then had fun trying out the creative techniques to generate as many ideas as possible. John challenged them several times and they were able to generate 60-70 wacky ideas to evaluate.

The Evaluation phase is about sorting the ideas out, with an initial sorting to cut down the numbers, using approaches such as who backs this question? if no one does, then it is dismissed, voting, and scoring against simplified criteria. Final scoring is done on the short list using more formal techniques to test the technical and financial viability.

The Development phase focuses on working up the best option(s), considering risk, whole life cost, feasibility and initial project planning.

Finally the Reporting phase presents the preferred option to the decision makers, explaining the reasons and the way forward.

Peter and John emphasised that the process is usually more effective if external facilitation is available to guide stakeholders through the process and to help ensure the discipline needed during the creative phase not to evaluate too soon.

To conclude and wash up the day, Peter and John facilitated a discussion on how to make this work back in the office. The main challenge seemed to be selling the idea and the potential benefits of investing time and resources into the process. Also challenging senior managers unfounded pet projects which could prove to be career limiting!

Peter and John referred to Government research that showed around 10% savings on project costs as well as better products for the user/customer.

The whole day was a great success with delegates taking away some practical ideas as well as the experience of having had a go themselves.

Copies of the presentations are on the APM web site here

Martin Gosden SWWE Branch Chairman

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