Construction Essays | Value Management Risk

construction Essays cling to anxiety try cargon for centering RiskRationale for sketchThrough come forward my fourth year of the Honours Degree sum analyze Programme, I plant the judge and Risk Appraisal module very interesting in particular the topic of think of instruction. I had never squ atomic number 18ly come across this topic before and nonwithstanding heard the term employ a few times only didnt re wholey k right away what was involved. From parturiency that specific module, it turn over the appearance _or_ semblances that foster charge is aboutly utilize as a tool to achieve apprise for Money for Clients. Working for a avower for 4 and a half years now, I have only ever seen prise counsel apply on one expression Project and this is the one that I am currently found on just now. From my experience, I feel that economic value wariness has a dish of advantages for Contractors as well as Clients and I wanted to recover out why it is non bein g utilise to a great outcome by Contractors.Get help with your essay from our expert essay writers revelatory Title pass judgment focalisesing A Contractors Perspective1.3 The AimTo pay back the reasons as to why think of heed is non being greatly intentd by Contractors in the formula industriousness.1.4 The lead-in(prenominal) ObjectivesIn indian lodge to achieve the above fuck off the following objectives must be metTo come upon the report principles and elements of time value steering.To identify techniques and working acts adopted and to identify the benefits of economic value anxiety.Examine the reason as to why Value focal point is non widely used in the Construction Industry.Critical compendium of the views of Main Contractors somewhat the benefits or short comings of Value anxiety.To propose recommendations for improved deed of instrument of Value focal point for Contractors.CHAPTER 2LITERATURE REVIEWVALUE solicitude2.1.1A DefinitionValue gui dance is a style of management in particular dedicated to motivating plurality, developing skills and promoting synergies and debut, with the aim of maximizing the overall act of an organization.The plant of Value Management online http//www.ivm.org.uk/vm_whatis.htm Accessed on 18 July 2007.Value Management is a group based process-driven methodology. Its incentive is to deliver a product, helper or come out at optimum whole life death penalty and monetary value without detriment to quality.By using police squads of experts in the Construction Industry, this allows the Value Management process to identify programme and construction solutions which offer the scoop encourage for money with regard to the usable requirements of the ClientKelly, J. Male, S. (1988) A line of business of Value Management and measurement Surveying sufficeValue Management plays a aboriginal role in the Construction Industry for consecutive improvement and innovation.The Background Concept Value Management originated in the unite States of America in the late 1940s and the process was originally used in the manufacturing industry. This was soon adopted by the Construction Industry in the UK by the start of the 1990s as conglomerate studies highlighted among 36% and 45% savings on estimated construction cost to the ClientKelly, J. Male, S. (1988) A information of Value Management and Quantity Surveying applyThe construct of Value compendium was introduced by Lawrence Miles in the 1940s. Miles, a Purchase steer working for the General Election, had to find ways to tackle the material shortages which was collectible to the secant World War. Miles sought to find alternative materials that would bear the selfsame(prenominal) function. This proved causeive as Miles found that many of the alternative products he was finding were of an equal, if not better quality than that originally proposed. In attachment to this he found that many of these alternatives were at a lower cost. Dallas (2006) states that a short while later, people realised that not only did the technique provide a way to substitute alternative materials but it was in any expression an excellent way to reduce be while shut up main(prenominal)taining the inevitable functionality. This system would involve hold dear and depth psychology and based on this Miles highly-developed the definition of Value Analysis.An organised approach to providing the necessary functions at the lowest cost.Kelly, J.R. Male, S.P. Graham, D. (2004) Value Management of Construction Projects.To promote enhance this Miles provides further definitionValue Analysis is an organised approach to the identification and voidance of unnecessary cost.Kelly, J.R. Male, S.P. Graham, D. (2004) Value Management of Construction Projects.Key Principles of Value ManagementThe institute of Value Management states that the key principles of Value Management argon different from other styles of management i n that they accept attributes that are not normally found in concertManagement StyleEmphasis on aggroupwork and talkA focus on what things do, rather than what they are (functional approach)An glory that encourages creativity and innovationA focus on customers requirementsA requirement to evaluate excerpts qualitatively to enable robust comparisons of optionPositive Human DynamicsTeamwork encouraging people to work together towards a common solutionSatisfaction recognizing and giving credit chat bringing people together by up communication mingled with themFostering better common reasonableness and providing better group termination supportEncouraging change challenging the status quo and bringing about beneficial changeOwnership the assumption of ownership of the outcomes of Value Management activities by those amenable for implementing themConsideration of remote and Internal EnvironmentExternal conditions taking account of pre-existing conditions impertinent to t he organisation over which managers may have little influenceInternal conditions within the organisation on that point leave alone be existing conditions which managers may or may not be able to influenceDegrees of Freedom the external and internal conditions volition dictate the limits of potential outcomes and should be quantified.Effective Use of manners and ToolsMeans of achieving outcomesThe pioneer of Value Management online http//www.ivm.org.uk/vm_whatis.htm Accessed on 18 July 2007From this we throw out see that Value Management brings Construction teams together and gets them to communicate more effectively with for each one other, this in turn entrust have a beneficial effect on the Project. The functionality of a Project go forth be more focussed on being able to achieve Value for Money.Value Management Techniques Function AnalysisFunction Analysis is a powerful technique in the identification of the principal functional requirements of a purportSeeley, I. (1 997) Quantity Surveying Practice. Second Edition.Function analysis is basically a thinker storming session with all people involved in the construction project and is used to determine the main inevitably of a project in pronounce to focus on alternative options that are less dearly-won although still achieving the functionality as essential. profuse DiagramsSeeley (1997) states that the FAST (Functional Analysis System Technique) has evolved from the functional analysis approach as it establishes a hierarchy of functions in gear up of importance.FAST diagrams are a more effective way of wake the main important functions and needs of a project.Bolton (2002) stated that function analysis was key to mastery in a shop class and always uses a FAST diagram.Pasquire and Mauro (2001) cite Norton and McElligott (1995) who suggest that the use of FAST may provide more benefit in the early exhibits of a project but not so much in the construction phases. It is too highlighted that FAST diagramming requires experience and training on the part of the facilitator to ensure it accurately depicts the function of the project. Another constraining factor is the time required to posture down FAST diagrams.Hunter, K. Kelly, J. (2006) Is One Day Enough? The Argue for Shorter VM/VE Studies.Value Management shop classsValue Management Workshops are one of the main techniques of Value Management. This ordain be discussed in greater detail in Chapter 2.2.Benefits of Value ManagementAfter several post-project reviews with Contractors and Consultants, Kelly Male identify various positive aspects of the Value Management process. The most crucial of these areProof that the initial design was indeed the bestPeace of mind to the owner that he was receiving slap-up value for money entrance to higher quality productsBest with-it technology at least costA clear focus on project objectivesAn alternative view of the designImproved project programmesImproved site management organizesAn opportunity for a tiny analysis of the required projectKelly, J. Male, S. (1988) A Study of Value Management and Quantity Surveying Practice.The Institute of Value Management indicates that Value Management has already been successful in achieving Value for Money for such Clients as BP, British Airways, Pfizer, Stanhope and various water and rail companies. This has resulted in the public sector adopting Value Management techniques in ordering to cut down construction costs and achieve better Value for Money.Benefits of Value Management according to the Institute of Value Management focus on greater communication and understanding within the Construction team but do not seem to focus on the cost benefitsBetter business stopping points by providing decision makers a sound basis for their choiceImproved products and services to external customers by clearly understanding and giving due priority to their real needsEnhanced competitiveness by facilitating technical and o rganisation innovationA common value culture thus enhancing every particles understanding of the organisations goalsImproved internal communication and common knowledge of the main success factors for the organisationSimultaneously heighten communication and efficiency by developing multidisciplinary and multitask teamworkDecisions which can be back up by the stakeholdersThe Institute of Value Management online http//www.ivm.org.uk/vm_whatis.htm Accessed on 18 July 2007Sir Michael Lathams report Constructing the Team (1994) states the benefits of Value Management and includes Value Management as a factor which is critical to the success of projects in providing the basis for improving value for money in construction.Hogg, K. (1999) Value Management A impuissance Opportunity? Nottingham, The Nottingham Trent University.Value Management is still not being used to a great extent in the construction industry disrespect the great number of benefits.The reasons for the apparent hesita nce of the industry to adopt Value Management on a greater scale are indecipherable since the benefits of Value Management appear to be widely recognised and the practice continues to be promoted at a high level.Hogg, K. (1999) Value Management A impuissance Opportunity? Nottingham, The Nottingham Trent University.Value Management WorkshopsBefore a VM shop class commences in strivingation has to be gathered to determine its objectives and deliverables and therefore what shape and cultivate the workshop go out take.Male, S. Kelly, J. et al (1998) The Value Management benchmark A Good Practice Framework for Clients and PractitionersValue Management Workshop expressionKelly (1996), details the key stages involved in a Value Management WorkshopValue Management workshops are characterised by a common chord stage processThe Orientation and Diagnostic Phase in which the value manager prepares for the study by meeting with the project sponsor and key players who will be involved in the study, reviewing documents, conducting interviews and briefings and preparing the agenda for the Workshop Stage.The Workshop Stage is where alternative or complementary views on the value conundrum are brought together done a structured team based activity facilitated by a value manager and progressed through the finishing of specific team based techniques. Innovative ideas are brought forward to reciprocate the functional requirements identified against a backdrop of the value criteria uncovered. A workshop report will be produced including an Action Plan to ensure that value solutions and options will be implemented in the post workshop phase.The effectuation Phase in which the Action Plan is followed through by those responsible for the investigation and murder of ideas.Kelly, J. (1996) Value Risk Appraisal chew the fat NotesThe planetary Benchmarking Study (1998) identifies the Implementation Phase as one of the key areas in which Value Management fails. At this sta ge the Value Management team have identified and adopted various approaches to ensure that the Value task is minimised as far as possible through various meetings and workshops in the previous phases. At this point an implementation strategy will be discussed with the relevant parties and if possible those involved in the implementation will be interviewed and identified in the action plan at the close of the workshop phase.Value Management Intervention PointsThere are three main stages of Value Management workshops and they all produce a great weed of training that is discussed between the Construction parties to find alternatives ways of constructing the grammatical construction and centre on achieving Value for Money. These stages are described on the next page. strategical planingThe Strategic drawinging stage deals with identifying the broad scope and mathematical function of the project and its important parameters. The focus is on find the strategic needs and wants, and the role and purpose of the project for the Client. Project BriefThe Project Brief translates the Strategic Brief into construction terms, specifying performance requirements for each of the elements of the project including spacial relationships and detailsA summary of the relevant parts of the Strategic Brief documentThe aim of the design. This would include priorities for project objectivesThe site, including details of accessibility and supplyThe size and configuration of activities chalk out specifications of general and specific areasA cost centred budget for all aspects of the project including all elements of the construction project service options and specification implications e.g. security, deliveries, access, etc.Kelly, J. (1996) Value Risk Appraisal Lecture Notes Outline Sketch DesignThe Outline Sketch Design (OSD) workshop is a value review of the initial plans, elevations, sections, specification and cost plan of the proposed building using the signed off Pro ject Brief as a reference point.Kelly (1996) explains what should be involved in an OSD WorkshopAs program line of the design directionThe site layout and access, identifying ground conditions and planning constraintsA detailed cost plan and schedule of activitiesDimensioned plans, elevations and sectionsAn outline specification for environmental systemsThe risks and a risk management strategyThe procurement planThe project execution plan with key milestonesPerformance measure.Kelly, J. (1996) Value Risk Appraisal Lecture NotesBenefits of Value Management WorkshopsThis is an extract from a journal that describes the benefits from an actual Value Management workshop that took placeAll team members confirmed their perpetration to continuous improvement. Only three did not feel that it had been as a result of the workshops. The team unanimously believed that more options had been explored within the team and all agreed to that being as a result of the workshops. A principal finding under the section of workshop effectiveness agreed to by all members of the team, was that the workshop provided a good basis for teamwork, created and atmosphere of equality, ensured founder and frequent communication and focused the participants on action and achieving results. The team members that indicated team working, cultures and communications as issues prior to the workshops agreed that they had all been resolved through the facilitated workshops.Hunter, K. Kelly, J. (2006) Value Management Workshops and Partnering Conundrums.From this extract we can see that there is a great deal of benefits for all parties by using Value Management workshops. There are in addition advantages to a VM workshop if the environment is isolated, these includeIt focuses the team on the projectGestation occurs during the workshop processIt commits the teamMilitates against partial attendanceContinuity is ensured.Male, S. Kelly, J. et al (1998) The Value Management Benchmark enquiry Results o f an International Benchmarking StudyRDT Pacific (2007) stated that there are other advantages of Value Management and Workshops.Value Management consistently provides significant improvements to projectsAverage capital cost savings of 14% (NSW Government Research)The beat of dedicated, synergistic project teamsAuditing on the project brief and the decision do processProvision of additional functionality within existing budget allocations organic evolution of a structured process to move projects efficiently to the next stage and ultimately completion.RDT Pacific online http//www.rdtpacific.co.nz/services/servicesportfolio/valuemanagement.shtml Accessed on 5 October 2007From this enquiry we can see that there is a great deal of benefits of using Value Management for all parties involved in a Construction Project. It is the purpose of this question penning to find out why Value Management is not being used a great deal by Contractors and therefore this research will provide bene ficial when it comes to interviewing Contractors on their views of Value Management workshops. A comparison will be made between the benefits and disadvantages of Value Management in the Research Analysis chapter in order to suggest qualified implementation of this process for Contractors.CHAPTER 3RESEARCH methodology3.1 Secondary Method of ResearchThe Secondary Research Method proposed includes probe historic papers and publications to assess the extent to which Value Management is used in the Construction Industry. Information will be obtained from books, journals, websites and lecture notes. The Glasgow Caledonian program library will be used to obtain books. The RICS (Royal Institute of Chartered Surveyors) and various websites will be used to obtain journals and info on Value Management.These methods of research are being used as they are promptly available. About 6 books from the Glasgow Caledonian Library were used for research and a gang of cultivation was found, how ever, the negative aspect of using books is that the information may not be up to date. Lecture notes from the Value and Risk Appraisal were used for the Literature Review in order to explain the processes of Value Management. They were produced by Professor John Kelly who either wrote the notes from his own experience or took extracts from books. A great amount of information was found from the lucre on Value Management and this was withal used to prepare the Literature Review. Information from the internet can be up to date although the disadvantage is that it can be someones opinion and may not be only true. Journals on Value Management were found on the RICS website, Athens and in addition on the Construction and Building News websites. Some journal information was also taken from the Glasgow Caledonian Library. The advantage of Journals is that there was a lot of information available and peoples views are expressed which is helpful for determining any problems that exist i n Value Management.This research will add the authors knowledge and understanding of Value Management and will also collapse an insight into the varying views on the subject.3.2 Primary Method of ResearchThe initial Primary Research Method proposed for this paper is to use actual Construction Project Case Studies in an attempt to find out how beneficial Value Management was for those projects. A few case studies were found on Projects that have used Value Management and they will be used to determine whether Value Management has been a success or not for the Project. Case Studies are useful for this research as they can be used to compare and also get peoples views on Value Management.A second Primary Research Method proposed for this paper will involve interviews with relevant Construction Industry personnel to gain their views and perspectives of Value Management in Construction Projects. adapted candidates will be mainly Contractors who have worked with Value Management on the ir previous Construction Projects and also the Chairman of the IVM (Institute of Value Management) in order to achieve the objectives of this paper.The purpose of these interviews is to gain a greater insight into the Value Management process and how there can be an improved implementation for Contractors. It is important to choose the correct questions to collect data to prepare a relevant analysis. Interviews are better for communicating as you are attend to face to a person and the interviewer is responsible for getting the quality of information that is required. A disadvantage of interviews however can be arranging meetings with the suitable candidates as they may not always be available when you are. To experience this, contacting the interviewees at the earliest opportunity is always recommended.3.3 Research Methodologies RejectedHaving elect the above methods for research it is important to note that alternative options such as questionnaires and electronic surveys were co nsidered for potential sources of information. However, it was felt that these options would not provide the quality of response and feedback that the other methods would for this research. Questionnaires and electronic surveys would require time to fill in and most construction personnel would probably not have the time required to complete them or would simply disregard the emails or paper copies as they would feel it would be too time consuming. Another disadvantage of these research methods is that the questions could be interpreted the wrong way or the quality of answers could not be as good as asking someone in person.CHAPTER 4PROGRESS TO DATE PLANNED FUTURE WORK come out to DateAt this stage, the indicative title, main aim and main objectives have been agreed. Research was undertaken throughout the summer on the topic of Value Management and the relevant materials were unruffled. Books, journals, case studies and website information were read and notes taken from each to f orm the basis for the literature review. The literature review has now been completed and also most of the information for the Date Analysis Chapter in the Final speaking report has been collected, such as books, journals, website information and journals. Everything required for the speech lag Report is now complete.4.2Research MethodologyThe final piece of methodology to be collected will be from interviews with Construction personnel which are still to be agreed and also the interview questions need to be created. These are both due to happen at the start of the New form and the planned interviews should take place towards the end of January 2008 at the latest.4.3Research Analysis and Resultsin one case the interviews have been conducted, an in depth analysis of the views will be undertaken, on with analysis of the information of other Construction personnel from the data collected via journals, case studies and books. This section will be undertaken from February 20084.4 Co nclusions and RecommendationsAt this stage, it will now be time to come to a conclusion and give recommendations on how to implement Value Management for Contractors. This section will be undertaken well(p) the end of March 2008.4.5 Structure of the Final DissertationBelow is the structure proposed for the final Dissertation document to be submitted in April 2008.Chapter 1 IntroductionChapter 1 introduces the rationale for study of the dissertation topic and the indicative title. It also determines the main aims and objectives, the research methodologies to be used and a structured segmentation of each chapter.Chapter 2 Value ManagementChapter 2 will focus on the background of Value Management and mainly on the key principles, techniques and advantages and disadvantages of this topic in the Construction Industry.Chapter 3 Value Management WorkshopsChapter 3 will focus on value management workshops in the Construction Industry and highlight the main advantages and disadvantages of this approach for Contractors.Chapter 4 Value Management in Previous Construction ProjectsChapter 4 will focus on case studies of previous construction projects that have used Value Management. They will be used to determine whether Value Management has been beneficial or not in the completion of the Projects.Chapter 5 Research Analysis and ResultsChapter 5 will analyse the information and feedback obtained from the interviews to be conducted. Chapter 5 will also compare the responses to identify the differences in opinion.Chapter 6 Conclusions and RecommendationsChapter 6 will set out the conclusions that have been established with reference to previous chapter literature research and the interview feedback responses. Chapter 6 will also discuss to what extent the aim and objectives have been achieved in this research paper. The author will finally give recommendations for improved implementation of Value Management for Contractors.ReferencesThis section provides a describe of all references used for this research which are quoted within the paper and will also provide readers with the sources of views and opinions expressed as a follow-up or extended research on the topic.BibliographyThis section will provide a list of all other references used in preparation of the paper but not directly quoted.AppendicesThe appendices section shall provide the reader with secondary information to that provided within Chapters 1 to 5.Programme of Future Work nonplus research questions for interviews Start January 2008Conduct research interviews End January 2008Data Analysis of interview results other research methods February 2008Conclusions and recommendations End of March 2008Final Dissertation hand in April 2008LIST OF REFERENCESDallas, M.F. (2006) Value Risk Management A Guide to Best PracticeHogg, K. (1999) Value Management A weakness Opportunity? Nottingham, The Nottingham Trent University.Hunter, K. Kelly, J. (2006) Is One Day Enough? The Argue for S horter VM/VE Studies.Hunter, K. Kelly, J. (2006) Value Management Workshops and Partnering Conundrums.Kelly, J. Male, S. (1988) A Study of Value Management and Quantity Surveying PracticeKelly, J. (1996) Value Risk Appraisal Lecture NotesKelly, J.R. Male, S.P. Graham, D. (2004) Value Management of Construction Projects.Male, S. Kelly, J. et al (1998) The Value Management Benchmark Research Results of an International Benchmarking StudyRDT Pacific online http//www.rdtpacific.co.nz/services/servicesportfolio/valuemanagement.shtml Accessed on 5 October 2007Seeley, I. (1997) Quantity Surveying Practice. Second Edition.The Institute of Value Management online http//www.ivm.org.uk/vm_whatis.htm Accessed on 18 July 2007.BIBLIOGRAPHYAdam, E. (1993) Value Management Cost Reduction Strategies for the 1990sDallas, M.F. (2006) Value Risk Management A Guide to Best PracticeHogg, K. The Nottingham Trent University (1999) Value Management A Failing Opportunity?Kelly, J. Male, S. (1988) A S tudy of Value Management and Quantity Surveying PracticeMale, S. Kelly, J. Fernie, S. Gronqvist, M. Bowles, G. (1998) The Value Management Benchmark A Good Practice Framework for Clients and PractitionersMale, S. Kelly, J. Fernie, S. Gronqvist, M. Bowles, G. (1998) The Value Management Benchmark Research Results of an International Benchmarking StudySeeley, I.H. (1997) Quantity Surveying PracticeThe Institute of Value Management online http//www.ivm.org.uk/vm_whatis.htm Accessed on 18 July 2007.