Value Management of Construction Projects

About the Authors JOHN KELLY was, until his recent retirement, the principal of Axoss Ltd, a company promoting and undertaking consultancy, training and research in value management, value engineering, whole life costing and whole life value. Prior to forming Axoss he was Professor of Construction Innovation in the School of the Built and Natural Environment, Glasgow Caledonian University. STEVEN MALE is Director of Steven Male Associates Limited, a specialist company dealing with consultancy assigments, research, and training in value-for-money in property and physical infrastruture asset management. He is currently working on a series of transport-related assignments for the World Bank. Prior to this Steven was Professor in Property & Infrastructure Asset Management at the University of Leeds. DRUMMOND GRAHAM is a Director at Thomson Bethune Property and Construction Consultants, Edinburgh. He has gained over forty years experience in the construction industry with government and private sector clients, covering a broad spectrum of projects and procurement routes, including PPP/PFI. His experience includes over 200 Value and Risk Management studies mostly at the early stages of projects across the building and transportation sectors.

• Preface xiGlossary xiiiPart 1 Introduction and Evolution of Value Management 11 Introduction 31.1 The aims and objectives of the book 31.2 Developments in UK construction 61.3 Developments in value management 91.4 The structure of the second edition 12References 132 Evolution of Value Engineering and Value Management 152.1 Introduction 152.2 Historical background 162.3 Definitions, terminology and practice – Phase 1: 1947 to 1963 172.4 Definitions, terminology and practice – Phase 2: 1963 to 1989 192.5 Definitions, terminology and practice – Phase 3: 1989 to 2014 202.6 The Project, Portfolio or Programme of projects 232.7 The 1998 international benchmarking study of VM and VE 242.8 Standards and procurement guidance 322.9 International research into value management 402.10 Implications for value management and value studies 422.11 Conclusions 46References 47Part 2 The Anatomy of a Value Study 513 Value Study Styles 553.1 Introduction 553.2 The inception of a project 563.3 The specification and procurement of a value study 573.4 Value studies within the project management process 593.5 The three generic phases of a value study 593.6 Study styles, processes and deliverables 613.7 Project development tracks 613.8 Value study type 1: Strategic briefing (project planning and business definition) 633.9 Value study type 2: Project briefing (the technical specification) 663.10 Value study type 3: Concept design (the technical solution) 703.11 Value study: Charette 733.12 Value studies 4 and 5: value engineering 753.13 Other study styles 793.14 Case study 843.15 Conclusion 95References 964 Function Analysis 974.1 Introduction 974.2 Discussion of function as a concept 984.3 Strategic function analysis – Information discovery and synthesis 1024.4 Strategies, programmes and projects 1094.5 Strategic function analysis – Function diagramming 1104.6 Project function analysis – Function diagramming 1144.7 Function space diagramming 1244.8 Elemental cost planning and elemental cost control 1284.9 Element function analysis 1304.10 Managing element clusters 1334.11 Evaluating function 1334.12 Conclusion 138References 1385 Managing Value Study Teams 1395.1 Introduction 1395.2 The Value Study Leader 1405.3 Groups, teams and team dynamics 1485.4 Implications for team management in value studies 1545.5 Value workshop management skills 1665.6 Conclusions and lessons from practice 169References 1716 Innovation, Implementation and Benefits Realisation 1736.1 Introduction 1736.2 Innovation 1746.3 Evaluation and development 1866.4 Implementation 1876.5 Benefits realisation 1886.6 Conclusion 189References 1897 Case Studies 1917.1 Case studies 1917.2 Case study 1 – Headquarters for a financial institution 1937.3 Case study 2 – Replacement of silo storage and process plant in food manufacturing facility 1977.4 Case study 3 – Rail infrastructure programme 2007.5 Case study 4 – Magistrates Court project 2057.6 Case study 5 – College campus library project 2097.7 Case study 6 – Material production facility expansion project 2157.8 Case study 7 – Social housing project 2197.9 Case study 8 - Crown Court project 2237.10 Project level: An overview of case studies 1 to 8 2267.11 Case study 9 – Organisational change 2267.12 The lessons learnt from the studies 236References 237Part 3 Whole-Life Business Value 2398 Value Management and Asset Management 2418.1 Introduction 2418.2 The importance of asset management as a discipline 2438.3 Defining and positioning asset management 2448.4 The characteristics of asset management 2518.5 Physical assets and value for money 2568.6 Value management and asset management case studies 2578.7 Conclusions 273References 2749 Managing Value in Portfolios, Programmes and Projects 2779.1 introduction 2779.2 Strategic management 2789.3 Portfolios, programmes and projects 2849.4 Value-based methodologies in the P3 environment 3139.5 A value case study: Prioritising a capital investment programme for an asset owner-user 3189.6 Conclusions 322References 32710 Option Appraisal, Risk Management and Whole Life Costing 33310.1 Introduction 33310.2 Objectives of TGB and option appraisal 33410.3 Risk management 34610.4 Whole life cost 35510.5 Case study: Forming a new academic department from the amalgamation of identical departments of two academic institutions 36410.6 Conclusion 370References 371Part 4 Developments in Value Thinking 37311 Discerning Value 37511.1 Introduction 37511.2 Part 1 – Background to the value debate 37611.3 Part 2 – Social and psychological dimensions of value 38411.4 Part 3 – Quality debated 38711.5 Part 4 – Principles for eliciting a value system 39111.6 Part 5 – Value systems in a construction environment 40011.7 Part 6 – Practical considerations and ethical issues in the use of a value system in a construction value study 41511.8 Conclusion 421References 42312 Whole Life Value 42712.1 Introduction 42712.2 A discussion of the methodological approaches to WLV 42912.3 Case study – illustration of a method for developing and using the whole life value conceptual model 44412.4 Conclusion 465References 46513 The Theory, Practice and Future of VM: A Revisionist Interpretation 46713.1 Introduction 46713.2 Demand and supply: the practice of VM 46713.3 Theoretical underpinnings 47513.4 Future directions: Theoretical and practice developments 48113.5 VM practice and professional territoriality 49413.6 The future of VM: Summary and conclusions 500References 503Appendix: Toolbox 507A. 1 Introduction 507A. 2 ACID test – Selecting the team 507A. 3 Action plan 507A. 4 Adjacency matrix 508A. 5 Audit – See also benefits realisation 508A. 6 Benchmarking 509A. 7 Benefits realisation 509A. 8 Brainstorming – Creativity 509A. 9 Briefing (by investigation or by facilitation) 509A.10 Checklist 510A.11 Client’s Value System and Client’s Project Value System matrix 512A.12 Delphi 512A.13 Design to Cost – BS EN 12973:2000 value management 514A.14 Document analysis 514A.15 Driver analysis 515A.16 Element function analysis 515A.17 Evaluation and development 518A.18 Facilities walkthrough 518A.19 Failure mode and effects analysis – BS EN 12973:2000 value management 519A.20 FAST (Function Analysis System Technique) diagramming/ function logic diagram 519A.21 Functional performance specification – BS EN 12973:2000 value management 519A.22 Function space analysis 519A.23 Gap analysis 520A.24 Goal and systems modelling 520A.25 Idea reduction – Judgement (see also weighting and scoring) 520A.26 Impact mapping 522A.27 Interviews 522A.28 Issues analysis 523A.29 Kano 524A.30 Lever of value 525A.31 Life-cycle costing 525A.32 Likert 525A.33 Presentation 526A.34 Project Value System 526A.35 Post-occupancy evaluation 526A.36 Process flowcharting 527A.37 Project execution plan (PEP) 527A.38 Quality function deployment 528A.39 Questionnaire 530A.40 REDReSS 531A.41 Risk analysis and management 531A.42 SMART methodology 532A.43 Space adjacency 532A.44 Space diagramming – User pathways 532A.45 Space requirement user function 532A.46 Stakeholder analysis/management/mapping 533A.47 Strengths, opportunities, weaknesses and threats (SWOT) 533A.48 Site tour 533A.49 Timeline 534A.50 Time, cost and quality 534A.51 User flow diagramming 535A.52 Weighting and scoring – (see also idea reduction) 535A.53 Whole-life costing 536References 539Index 541

Select Guide Rating