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Value Management And Its Application In The Construction Industry Construction

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The building industry the universe over is frequently perceived to be the life wire of its several economic system as it cuts across all facets of human activities ( Ayangade, 2009 ) and the Nigerian building industry is non an exclusion to this. Its part ranges from enabling the procurance of goods and services to the proviso of edifices and other substructure, thereby supplying employment chances to its labour force while lending vastly to the Gross Domestic Product ( GDP ) . Harmonizing to Ayangade ( 2009 ) , the part of the Nigerian building industry is yet to mensurate up to those of the western universe like the UK and Australia due to its underdeveloped nature among other grounds discussed at a lower place.

As noted by the same research worker ( Ayangade, 2009 ) , whereas the building industries of other developed states are responsible for approximately 22 % of their several GDP ‘s, the Nigerian instance is different as it contributes somewhat below 16 % to its economic system. However, this could be said to be complemented by the comparatively higher employment ( 20 % ) it provides for its whooping 140 million citizens compared to the 12 % as in the instance of developed states.

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Mbamali ( 2004 ) attributed this to comparatively lower usage of mechanisation within building in Nigeria and the high dependence of the Nigerian economic system on the oil sector. Obiegbu ( 2005 ) noted that the building industry, unlike other sectors, is a complex one and requires articulate professionals who are ready to populate up to its clients ‘ outlooks. Clients in the building industry may either be private persons including corporate organic structures or public administrations which include the authorities. In Nigeria the federal authorities is frequently seen to be involved in the most complex undertakings with approximately 38.4 % of the market ( Ayangade, 2005 ) . This is followed by the province authorities which is responsible for approximately 19.2 % of the undertakings in the industry, though there is still some signifier of partnering between different categories of clients. The participants in the industry are a disparate group of persons frequently assembled into impermanent squads and may consist of measure surveyors, designers, Engineers, Estate surveyors & A ; Valuers, undertaking directors, contractors and sub-contractors, providers, laborers and craftsmans.

Activities in the building industry are carried out on a undertaking footing and could be within an administration or portion of a programme ( … ..reference ) . The Project Management Institute ( PMI ) ( 2004 ) defined a undertaking as “ a impermanent enterprise undertaken to make a alone merchandise, service or consequence ” . The merchandise, in the context of the building industry, may be a edifice, services installing or other infrastructural undertaking. Hence the relevant mix of professionals is frequently assembled together with the purpose of accomplishing this end. This group of professionals is expected to possess the relevant accomplishments, cognition, tools and techniques to accomplish the undertaking ends. The application of these variables, accomplishments, cognition, tools and techniques, with the purpose accomplishing the needed aim is referred to as undertaking direction ( PMI, 2004 ) . Harmonizing to Obiegbu ( 2005 ) , the contractual procurance scheme, which he defined as a footing for client ‘s action in specifying the process to be followed from the origin of the undertaking to handover, plays an of import function in the public presentation of the industry. Some of the contractual agreements which are frequently referred to as procurement paths may include, but are non limited to, the followers:

Traditional procurance path

Design and construct

Management contracts

2.1.1 Nature and Performance of the Nigerian Construction Industry

“ … the economic resources frequently wasted in cost and clip overproductions, deficient work and cheapjack craft, client-contractor-practitioner ‘s bitter relationships and non-performance of undertakings as envisaged by clients and terminal users… ”

Olatunje ( 2009 )

The above quotation mark highlights the perceptual experience of the Nigerian building industry presented by Olatunje ( 2009 ) high spots issues researched by other writers such as cost and clip overproductions ( Aniekwu and Okpala, 1998, Oyedele & A ; Tham, 2007, Dlakwa & A ; Culpin, 1990 ) , project forsaking ( Sonuga et al, 2002, Adams, 1997 ) and both client and contractor dissatisfaction ( Olatunje, 2009 ) . The quotation mark besides echoes findings from Egan ‘s ( 1998 ) research into the UK building industry. The Egan study has been formative in the UK building industry but besides for the Nigerian industry, which is fashioned after the UK ‘s ( Mbamali, et al. , 2005, Oyedele & A ; Tham, 2007 ) .

The Nigerian building industry has similar contractual agreements as the industry in Britain which has been found to be more unsuitable for developing industries like Nigeria than it is for its ain industry ( Edmonds & A ; Miles, 1983, Sonuga et Al, 2002 ) . The most common procurance path used in the Nigerian building industry is the “ traditional path ” ( Ayangade, 2009 ) . This implies that much hazard is placed on the Architect to present the undertaking as he is left to rede, organize and take other undertaking advisers to gestate and develop the undertaking design. This procurance path has faced a batch of unfavorable judgment including the separation of the design phase from existent building. Wells ( 1986 ) found that the divorce of design from building and the usage of competitory tendering, which is based on lowest cost, are celebrated restraints that affect the public presentation of the Nigerian building industry. Aniekwu and Okpala ( 1988 ) referred to these as systemic issues in the industry which consequence from the application of contractual agreements unsuited to the Nigerian industry. Some of these issues may be accommodated by appropriate conditions of contract but these factors are considered to be keep backing the development of the industry. Aniekwu and Okpala ( 1988 ) besides identified some of the structural issues impacting the industry to include entree to finance and deficiency of proper communicating among advisers, contractors and the client at the early stages the undertaking and during building. Oyodele and Tham ( 2005 ) noted that deficiency of proper communicating in the industry, boosted by its high degree of atomization, has left it awash it with hold, cost and clip overproductions in add-on to the upseting rate of fluctuation in the monetary values of stuffs offered by the economic system. The findings of the Building Research Establishment associated more than 50 % of the building defects with errors in undertaking drawings and certification due to unequal interaction among the undertaking professionals. This is in line with the recommendation of the National Economic Development Office ( 1987 ) on the demand for more accurate designs in the industry as this is responsible for about two-thirds of hapless quality work in the industry.

2.1.2 Project Management in the Nigerian Construction Industry

Odusemi et Al, ( 2003 ) found that Project Management is still in its early phases of development in the Nigerian building industry. The service is offered but merely aboard other consultancy services. This is non assisted by the fact that PM is learned experientially and is non represented by established professional organic structures, although many advisers are members of the Association of Project Management ( APM ) and the Project Management Institute ( PMI ) . This has left the industry fighting with the challenges of fulfilling the demands of its clients and the populace as a whole. As noted by Oyodale and Tham ( 2005 ) , the complexnesss presented by the industry can merely be tackled by its professionals. Aibinu and Jagboro ( 2002 ) concluded that, sing the part of the building industry to its state ‘s economic system, improved services in the signifier of greater efficiency and seasonableness would surely give a positive impact. The research called on the demand for advanced research that will better direction accomplishments and ability, buildability, design quality, integrating and communicating and client focal point so as to present value for money.


2.2.1 Value Concept

Historically, value is viewed from an economic position, hence its look as a ratio of costs to benefits ( Kelly et al, 2004 ) . “ The construct of value is based on the relationship between fulfilling demands and the outlooks and the resources required to accomplish them ” ( British Standard, 2000 ) . The above statement implies that for value to be right defined at that place ought to be some demands that are desired to be satisfied ; which are so weighed against the needed and available resources to accomplish them. This nevertheless does non compare reduced cost to heighten value. For case, as illustrated in figure 2.1 below, a undertaking director may make up one’s mind to perpetrate more resources in the short tally ( which would evidently increase cost ) with an purpose of increasing his gross ( improved value ) in the long tally. Value can therefore be increased when the client ‘s satisfaction additions and the cost in footings of resources either diminishes, or increases to a lesser extent ( Tassinari ( 1985, p37 ) .

Figure 2.1 demoing the relationship between resources and client satisfaction. ( Adapted from British Standard, 2000 )

A demand is that which is desired or necessary to execute a peculiar map and will differ depending on the nature of the client or the position from which it is defined ( British Standard, 2000 ) . This explains why value is frequently seen to be a subjective term ( Thiry, 1997 ) . Harmonizing to Kelly et Al ( 2004 ) manufacturers and traders may both position value as the monetary value of a physical object while the consumers or users would see value from its public presentation position which changes with clip. McGeorge and Palmer ( 2002 ) illustrate this utilizing a modern place which has a small battery operated wireless in add-on to internet, phone, and telecasting. Of class, the little wireless would be perceived to hold small or no value until a snow storm cuts the house off from the electric power supply which will render the wireless as the lone beginning of communicating.

The above illustration by McGeorge and Palmer ( 2002 ) shows the consequence clip and invention can hold on a clients ‘ reading of value and how it can alter given a peculiar state of affairs. The little battery operated wireless was ab initio of really high value when it was the lone available option but diminished with the innovation and/or acquisition of cyberspace, phone and telecasting by the family. However its grasp changed when the state of affairs alteration. Harmonizing to Zimmerman and Hart ( 1982Shona Flannery2010-07-24T16:24:00

P ) as cited in Thiry ( 1997 ) , “ if a design has non changed in 18 old ages, the merchandise is either first-class or direction has failed to better it ” . However one knows that neither of these two conditions mentioned in the above statement is gettable in the present building industry due to its extremely competitory nature. Most times clients ‘ reading of value is when it meets or transcend their outlooks. Kelly and Male ( 2007 ) described this utilizing the Kano ‘s theoretical account as shown in figure 2.3 below.

Figure 2.2 Kano ‘s Model, reproduced from Kelly and Male, 2007 As shown on Kano ‘s theoretical account above, there are three degrees of satisfaction factors ; “ basic ” , “ public presentation ” and “ delighter ” , each holding some effects on the quality features including clients satisfaction. Harmonizing to Kelly and Male ( 2007 ) , Kano ‘s theoretical account ( figure 2.2 ) does non merely portray the importance of accomplishing a client ‘s immediate outlooks from a undertaking but besides the demand to travel the excess stat mi to better it beyond the client ‘s outlooks as this gives them a ‘delighter ‘ satisfaction. The possible benefit from this is that undertakings would non go disused within a short period of its completion as its public presentation would still transcend the clients ‘ demand, thereby guaranting the client of continued good value for his money. Kano ‘s theoretical account besides creates room for improved undertakings through advanced services and merchandises as what was one time a ‘delighter ‘ over clip goes down to ‘basic ‘ and forms a baseline below which the client becomes disgruntled. Harmonizing to Harty ( 2009 ) one of the drive forces behind the value direction construct is that it encourages invention through research which is in line with the recommendations of Egan ( 1998 ) to better the public presentation of the building industry.

2.2.2 Specifying the Client Value System

Clients in the building industry have been described as a heterogenous group made up of private or public administrations runing in different environments with diverse grounds for their being ( Kelly et al 2007 ) . Some of these are transnational administrations viing at the planetary degree who already have reputes to protect while some are little approaching administrations who are still really much net income driven. Viewed from another position, some of these clients are more experient than others irrespective of their sizes or the sector in which they operate. It so follows that clients are alone in their ain ways and have single, several demands which determine their demands and hence what is of value to them. This is referred to as the client value system. Harmonizing and prioritising these diverse positions of stakeholders in a peculiar undertaking at the undertaking briefing phase sets the client ‘s value system and ensures that value for money ( VfM ) is achieved, ( OGC, 2007 ) .

The client value system is therefore seen as a footing for doing determinations as to the allotment and usage of resources available for a undertaking, thereby turn toing the usual mismatch between the client ‘s existent purpose and his capableness ( Thiry, 1996 ) . Harmonizing to Kelly et Al ( 2004, p157 ) one of the most of import considerations of value direction is the acknowledgment of the singularity of each client ‘s value system. This creates demand for the building industry as it is focused on the clients by doing expressed what value means to the each single client. Sequel to this, Kelly et Al ( 2004 ) identified some mensurable standards which form a typical building client value system to include clip, capital costs, runing cost, environment, exchange, flexibleness, esteem, comfort and political relations. Time

Refers to the period from when the undertaking was conceptualized to the period when it is completed and absorbed into the client ‘s administration. Often clip is assessed on a continuum from when it is of kernel to the point where it could be compromised ( Kelly et al, 2004 ) . For case a undertaking to construct a athleticss saloon for the 2010 universe cup delivered merely a twenty-four hours past the beginning of the tourney, may drastically impact its value. Hence it is necessary to find what clip means to the client. Capital outgo ( CAPEX )

Are those costs associated with the capital cost of a undertaking, measured on a continuum between the budget being considered tight and non able to be exceeded to there being flexibleness in budgeting ( Kelly et al 2004 ) . Simply put, CAPEX is what it cost to set a undertaking on land, from origin to handover. However, Elinwa and Joshua ( 2001 ) stated that it is sometimes hard to divide the capital costs of some undertakings from its operating costs due the platform on which it was procured. For illustration a primary wellness Centre to be procured through PFI, it may non be so easy to trap point the capital costs as it forms portion of the entire rental bundle. Operating outgo ( OPEX )

Spending on building undertakings is non one away outgo as the edifice requires to be operated, maintained and repaired throughout the life span of the edifice. Harmonizing to Kelly et Al ( 2004 ) , OPEX can be defined as those costs associated with operation and care of a completed undertaking as it becomes a portion of the client ‘s organisation ; measured by the extent to which it is minimized to its point of being flexible. This depends on the usage to which a edifice is being put to. For case where the edifice is for residential intent, the operating costs may include public-service corporations, cleansing, fixs, care, caretaker and security. This may be expanded to include photocopying and cyberspace installations and other office services for a commercial development. Environment

This defines how of import accomplishing an environmentally friendly undertaking is to the client. Kelly et Al ( 2004 ) defined environment as the extent to which the undertaking consequences in a sympathetic attack to its immediate and extended physical environments in footings of energy consumed in seting it up and in runing it. The yardstick here is the degree to which the undertaking complies with the Kyoto Agreement and Agenda 21 issues including other environmental ordinances. This explains a client ‘s involvement in holding a sustainable development which is resources witting. Exchange or resale

This refers to the pecuniary value of the undertaking were it to be sold, rented or valued as portion of an administrations assets. Where the undertaking can non be traded on the unfastened market value or there is no purpose to resell ab initio, this will be indicated in the administration ‘s value system ( Kelly et al, 2004 ) . The continuum here is between the returns from the undertaking being of importance to the returns being of non of much or no importance to the client. Flexibility

As recommended by Egan ( 1998 ) , there is a demand for building undertakings to be at a par with betterments in engineering and alterations in market demand. Hence flexibleness as a value standard is the extent to which a undertaking parametric quantity has to reflect this of all time altering environment at its design phase ( Kelly et al 2004 ) . For case, the nature of the health care industry involves changeless betterments in engineering and hence health care installations must be compatible with the incorporation of these alterations. However, flexibleness depends on the nature of the undertaking and is measured between being really easy to alter its map to being impossible. Esteem

This refers to the sum of immediate resources that a client wants to waive for properties like prestigiousness, aesthetic and visual aspect instead than public presentation ( Thiry, 1996 ) . Some undertakings may non be feasible based on other value standards but of high value to the client on esteem evidences. For case, some undertakings undertaken by some states could be merely aimed at making consciousness and seting the state ‘s name “ on the map ” as in the instance of the universe ‘s tallest edifice in Dubai. Comfort

In the context of a edifice this refers to the physical and psychological comfort of the edifice as a topographic point for working and populating with its influence on human public presentation ( Kelly et al 2004 ) . Simply put, it refers to the easiness with which the undertaking supports the concern carried out in it or other utilizations to which it is being put. Politicss

This is external to undertakings and refers to the degree of resources that the client wants to perpetrate to the community, popularity and good neighbor issues which frequently determines how of import they Shona Flannery2010-07-24T17:55:00

who? are to him ( Kelly and Male, 2007 ) . This is measured by the motivation to be popular with the local community or non holding any concern with them at all.

In a survey conducted to find clients ‘ appraisal of designers ‘ public presentation in Nigeria in footings of presenting value for money, Lukmon et Al ( 2007 ) , identified a set of 28 similar but correlated standards which they grouped under quality of undertaking, buildability, client focal point and direction accomplishments.

2.2.3 Historical Background of Value Management

A undertaking is defined as “ an project aimed at accomplishing a specific nonsubjective normally measured in footings of public presentation, budget and agenda, ” ( Morris and Hough 1987 ) . Hence undertaking is an investing undertaken to add value to the nucleus concern of a client ( Kelly et al, 2004 ) . Value Management, as a direction technique, offers the most logical attack to presenting VfM to clients ( Shen and Liu 2003 ) ; Kelly and Male, 2007 ) . Its strength may be attributed to its attack of placing and/or verifying a client ‘s value system among the relevant stakeholders at an early phase of the undertaking, so that these may be reflected in the undertaking design.

Harmonizing to Thiry ( 1996 ) the beginnings of VM can be traced back to the fortiess in what he described as “ more for less ” in the USA fabrication industry. During World War II Lawrence Miles, an Engineer with General Electric, was faced with some strategic jobs in bring forthing some constituents which were easy produced in the yesteryear. As a manner around this Miles, who before so has been dissatisfied with the cost of production in the industry, came to gain that most times circumstantial inventions result in better public presentation and decreased cost. This prompted Miles to inquire “ what map does this constituent perform ” and “ how else can we execute that map ” ( Dallas, 2006Shona Flannery2010-07-24T17:59:00

P ) . Miles ‘ inquiries gave rise to the construct of map analysis which was aimed at placing and analyzing the intended maps to find if the stuffs for the proposed solution can be substituted with less expensive 1s. Not long after, people started to follow the technique of concentrating on the intended map non the procedure which shortly developed into what is today referred to as Value Analysis ( VA ) .

In many instances people perceived the technique as a cost decrease technique at the disbursal of improved functionality which is a entire misconception of the technique ( Kelly and Male, 1993 ) . However, the technique was so successful that in less than 10 old ages it was adopted in the US Department of Defence to present VfM and from so on other industries in the USA have adapted it for application at different stages of their undertakings. Value Management ( VM ) as it came to be called, refers to a structured direction of the entire value equation throughout all phases of the undertaking ( Kelly et al ; 2004 ) . Figure 2.3 shows different phases and sections of the development of value direction.

Figure 2.3 The metabolism of Value Management, adapted from Dallas ( 2006 )

As illustrated in figure 2.3, Miles ‘ action in the 1940s was focused on acquiring alternate stuffs or constituents to execute the needed map which was the beginning of value direction. This was subsequently perceived as a cost film editing technique before the acceptance of a holistic structured attack to bettering value ( Kelly and Male, 1993 ) .

Following the development and positive impacts of value direction in the US fabrication sector, the technique was adopted into the US building industry as a agency of presenting VfM to its clients ‘ in the sixtiess. Fong and Shen ( 2000 ) noted that VM was foremost introduced in the US building industry in 1968 and its application in the Chinese building industry is recorded to happen 10 old ages subsequently ( Shen and Liu, 2004 ) . Harmonizing to Kelly et Al ( 2004 ) , the value direction technique was foremost used in the UK 30 old ages after it was introduced in the US fabrication industry at the Xerox central office, an American company. From so on VM has grown to go widely accepted in different parts of the universe as a logical agencies to accomplish value for money ( Fong, 2004 ; Kelly et Al, 2004 ; Ellis et Al, 2004 ) including in Africa ( Bowen et al, 2008 ) .

2.2.4 Benefits of Value direction

“ Value direction is a proactive, job work outing service, which maximizes the functional value of a undertaking through a structured squad which makes explicit the client ‘s value system and weights farther determinations against the value system ” . ( Kelly et al, 1998 ) .

VM aims to warrant the topographic point of a undertaking in a client ‘s administration at an early phase and develops a strategic program against which it is built on to present value for money. VM is frequently misconstrued to being a cost decrease exercising, therefore seen to be synonymous with value engineeringShona Flannery2010-07-24T18:14:00

. Harmonizing to Dallas ( 2006 ) cost decrease, which is an obvious end product of a value direction exercising, can non after all be seen as its chief motivation. As illustrated in figure 2.4 below, VM incorporates value technology and value analysis in its value definition exercising and so could be perceived to be a cosmopolitan set for the three constructs.

Figure 2.4 shows the relationship between Value Management, Value Engineering and Value Analysis, adapted from Connaughton and Green ( 1996 )

VM looks at a undertaking from a holistic point of position ( clip, whole life cost and public presentation ) in the context of its use which decently fits in the definition of value for money ( … ) . Connaughton and Green ( 1996 ) identified the following benefits which a decently executed Value Management exercising can give:

The demand for the undertaking is made explicit and verified by available informations.

The undertaking aims are identified and discussed openly to make a consensus.

Rational, explicit and mensurable determinations are guaranteed after options have been considered.

Undertaking designs are developed from the agreed model, which are evaluated on the footing of the in agreement public presentation standards.

There is greater engagement from stakeholders which guarantees their bargain in.

There is improved communicating and teamwork spirit throughout the undertaking.

Improved invention with better quality definition in the undertaking.

Unnecessary cost is eliminated which may take to a decrease in cost.

Properly executed, value direction when employed at the early phases of a undertaking can assist extinguish unneeded cost to the melody of 10 % to 25 % nest eggs on the proposed capital cost of undertaking ( Ellis et al, 2004 ) . This is considered to be sensible compared to the existent cost of the VM exercising, which is estimated at approximately 0.5 % to 1 % of the undertaking ‘s cost ( REF ) .


“ Any building undertaking should be merely commissioned following a careful analysis of demands since failure to believe through undertaking demands will about surely cause jobs for subsequent design and building phases. For that ground, the Construction Industry Board recommends that value direction be incorporated as an built-in portion of the building procedure ” ( Baldwin 1998 ) .

The value direction attack may differ between states depending on the nature of their building industry or the chosen procurance path in a peculiar undertaking. However, this does non challenge the fact that the VM technique can be gainfully applied at any phase of a building undertaking, as clients/contractors are frequently faced with the challenge of happening an optimal balance between cost, clip, quality and public presentation standards ( Fong 2004 ) .

In the UK, the USA, Australia and other states where the value direction technique is good established, VM is applied through a procedure referred to as the value direction survey ( British Standard, 2000 ) or value direction procedure ( Kelly et al ; 1998 ) via a workshop attack facilitated by value director or experienced squad facilitator. A value direction survey, as defined in BS12947, involves the application of value direction to a peculiar concern instance identified within a VM programme. Baldwin ( 1998, as cited in Kelly et Al, 1998 ) noted that VM is non a inquiry of brainstorming and job resolution, instead it requires a structured methodological analysis in order to hold the needed result. Figure 2.5 overleaf depicts a simple VM survey program developed for the European Value Management criterion ( British Standard, 2000 ) .

Figure 2.5 shows a simple VM survey program, adapted from the British Standard ( 2000 )

The VM survey program represents a systematic attack to guaranting that appropriate techniques and accomplishments are utilized in the value survey. Harmonizing to the British Standard ( 2000 ) , as shown in the VM survey program above, a VM survey should take to accomplish the undermentioned aims ;

Identify the aims and targets the intended survey is set to accomplish ; as this may differ from the undertaking objectives.

Formulate the relevant attack needed to accomplish the aims, including squad choice and preparation ( where necessary ) .

Identify the relevant maps which will take to the accomplishment of the aims.

Identify some footing for mensurating alterations in public presentation and usage of resources.

Set marks for public presentation and usage of resources for the above identified maps in a manner peculiar to the administrations.

Identify advanced ways of geting at the marks through the application of the above methods.

Measure the proposal for betterment.

Implement the proposal which have been chosen by the determination shapers

Monitor and step the results in relation to the mark.

Feedback consequences for uninterrupted betterment of VM programme.

There are different attacks to value direction surveies in different states with respects to team composings and workshop process. For case in the American building industry, VM surveies are typically carried out by an independent workshop squad who will hold to “ sell ” their thoughts to the undertaking squad subsequently on. This is different from the UK pattern where the bing undertaking squad is to the full involved in the survey. In a benchmarking exercising carried by Kelly et Al ( 1998 ) , the usage of an bing undertaking squad in carry oning value direction surveies appeared to be the preferable attack due to the undermentioned advantages accruable to the undertaking ;

Cost of the survey is comparatively minimized

Time spent undertaking briefing the survey participants is decreased

Waste of resources on antecedently considered but failed thoughts are eliminated

Offers better chance for developing project squads during the workshop

More chance to research all available options

Execution is more guaranteed as squad members have already accepted thoughts which they generated as a squad, thereby cut downing the development period.

However, generic VM workshop strives to add value to a undertaking by sing the undertaking on its whole life footing. Kelly et Al ( 1998 ) who were in support of this position identified the five cardinal value chances at which VM technique can be employed to include pre-brief workshop, proper Shona Flannery2010-07-24T18:44:00

? workshop, study design workshop, concluding working design and execution workshop.

2.3.1 Pre-brief workshop

The Value Manager or Facilitator meets with the undertaking sponsor/client to clear up the topographic point of the undertaking in his administration or programme. This will give the two parties a better apprehension of the functional outlooks of the undertaking so as to assist organize a footing for the undertaking briefing workshop and the client ‘s value system. This may give solution/s to the client ‘s job, for illustration, whether a new edifice is needed or redevelopment of bing one will accomplish the same aims.

2.3.2 Proper workshop

Returns from the identified solution in the pre-brief stage and aims to place the client ‘s value system. This workshop offers an chance to ease the undertaking squad, understand their kineticss and steer them to accomplish the coveted end. Though it is expected that the workshop has an docket, this should non be excessively elaborate, thereby doing the timings fast, as this may deviate the focal point from accomplishing the aims of the workshop to wash uping the points on the docket. The tactical accomplishments of the Facilitator are really much needed at this phase of the workshop if its participants are to be productive and should be as brief and focused as possible.

2.3.3 Sketch design workshop

Sets a base for the elaborate drawings and represents the design squad ‘s perceptual experience of the predating undertaking brief. This is frequently in the signifier studies and notes to back up the drawings where necessary. These are presented to the relevant stakeholders in the signifier of outline proposals and scheme designs.

2.3.4 Final working design ( FWD ) workshop

Follows the lineation proposals and strategy designs are presented, merely before the existent design of the undertaking starts. The activities considered in the workshop may include some elements and constituents issues for elaborate drawings, production information, measure of measures and stamp actions.

2.3.5 Implementation workshop

This workshop addresses the buildability of the emerged undertaking design and how stuffs will be procured. This is to be done following the assignment of the contractor and sub-contractors.

A figure of writers ( Dallas 2006 ; Ellis et Al, 2005 ; Thiry 2001 ) including Kelly et Al ( 1998 ) agreed that in add-on to the above workshop attack that the usage of the charette workshop is fast deriving evidences among professionals. This attack is described as the combination of the first three workshops discussed above.

However, Ellis et Al ( 2005 ) concluded that the phases of the workshop is non of much importance provided the “ occupation program sequence ” is either followed or adapted to foreground the value opportunities which he referred to as determination points. SAVE International defines the occupation program as “ an organized attack to the behavior of a value survey ” ( Thiry, 1996, p14 ) . Figure 2.6 represents a value direction occupation program.

Figure 2.6 a VM survey occupation program, Shen & A ; Liu ( 2004 )

As mentioned earlier, there is no conclusive format for the occupation program as it may differ in attack but will fundamentally hold the same purpose which is to place and steer the relevant professionals and stakeholders to accomplish the undertaking end.

Research carried out by Kelly and Hunter ( 2007 ) on the continuance of VM workshops among practicians showed some disparities non needfully among states but among professionals even within the same states. For case, though the general occupation program in the UK and the US is to hold VM surveies workshop last for 1 twenty-four hours and 3-5 yearss severally, some practicians in the US prefer shorter VM workshops as they and participants could hold other battles or may acquire bored of the procedure. On the other manus, some professionals in the UK were of the position that more clip spent on VM workshops means a more in-depth survey. However, Thiry ( 2001 ) noted the argument on VM ‘s workshop continuance is controversial as the complexnesss presented by the nature of some undertakings would instead do it hard to yield to some clients demand for shorter VM workshops. Kelly and Hunter ( 2007 ) concluded that the overall continuance of workshops can non be pegged either in UK or US pattern, instead the nature of the undertaking and client in inquiry would be the deciding factors.


As a direction technique, VM concentrates on placing and verifying a client ‘s value system within their administration or programme by supplying the right mix of multi-disciplinary squad and stakeholders together at the right clip ( Male et Al, 2007 ) . As celebrated earlier, most practicians misconstrue VM to be a cost film editing exercising and hence apply VM at a ulterior phase of the undertaking after the design has been developed. This nevertheless can non be said to travel against the rules of VM as its technique can justly be applied at any phase of the undertaking. In a argument on the topographic point of the measure appraising profession in the pattern of value direction, Green and Liu ( 2007 ) attributes this to a command for the cost advisers to win the market through minimising cost. Kelly et Al ( 2004 ) utilize a “ lever of quality ” to exemplify some different points at which value direction can step in in the undertaking lifecycle and the comparative sum of force per unit area that will be required to better value, figure 2.7.

Figure 2.7 Winston Davies ‘ Lever of Quality, adapted from Kelly et Al ( 2004 )

Figure 2.7 illustrates the impact of value direction technique applied at the different phases of a undertaking.

Figure 2.8 shows the degree of application of VM and the different intercession points ( Male et Al, 1998 )

Obviously, undertakings bring about alteration ( s ) to administrations and at its strategic phase the accent is to happen the motivation and outlooks of the undertaking and so, non much resources ( if any ) demand to be invested. This implies that VM, if applied at this early phase as shown in figure 2.7, could be more economical in footings cost, clip and public presentation. As noted by Kelly et Al ( 2004 pp98 ) chance to better undertaking value is greater at the beginning of the undertaking and will necessitate comparatively more force ( resources ) as it goes down the lever. This is because when applied at the early phase of the undertaking, the needed maps are identified by the undertaking squad and stakeholders thereby guaranting their buy-in. This implies that the merely expected alteration will be that caused by the debut of alteration to the undertaking as opposed to altering an already developed design. Male et Al ( 2007 ) added that reactive application of the VM technique will affect a re-arrangement of a distorted value system and bearing in head that excess cost is incurred in re-tracing stairss, accomplishment of value for money ( VfM ) could be comparatively more hard. Project completion and public presentation could besides be threatened as changing the sequence of undertakings may do the undertaking squad to go dysfunctional.


“ Value direction methods have developed and are widely used since its first debut into the USA building industry ” , ( Fong and Shen 2000 ) . Numerous research workers including Kelly et Al, ( 2004 ) pg 48 ; Ellis et Al, ( 2005 ) have at one point or another made similar averments in their single plants. Whereas this could be true in states like the UK, Australia and the USA, the consequence of the research by Bowen et Al, ( 2009 ) in which he verified the cogency of these averments shows that VM techniques, due to some factors, is yet to be to the full embraced in some states. Part of the ground being that prior to the development of VM, professionals in the building industry have used other direction techniques ( value planning, value technology, value analysis, entire quality direction, for illustration ) through which they deliver value for money to clients and so may still go on to utilize these. Harmonizing Green and Connaughton ( 1996 ) and Bowen et Al ( 2009 ) some professionals claim that ‘value direction is what we do anyhow ‘ . Where this may be true, as they do present value for money to client sometimes, Green and Connaughton ( 1996 ) pointed out that the motivation of value direction is to vouch VfM in all undertakings and non ‘sometimes ‘ .

A similar survey carried out by Fong ( 2004 ) revealed that one of the jobs impacting the development of VM is its sensed effort to incorporate into other constructs likes partnering, benchmarking and re-engineering as a value heightening exercising. Harty ( 2009 ) noted that this would likely ensue in professionals or clients comprehending VM as portion of a procedure to better efficiency instead than an established technique on its ain. Naderpajouh and Afshar ( 2007 ) noted that some professionals are risk averters and so are loath to be advanced which makes them avoid the technique. Hence there is demand for an established professional and academic image that will advance and further understanding among corporate administrations, authorities bureaus and the populace. On their portion, Fong and Shen ( 2000 ) , in add-on to a deficiency of cognition and apprehension among clients and practicians, noted that deficiency of clip Shona Flannery2010-07-24T20:40:00

? and reluctance in following the VM technique could be a possible hinderance to its growing. This loath attack is displayed by the acceptance of a “ tick-the-box ” attack in public sector undertakings or other administrations where the policy makes it compulsory to use VMShona Flannery2010-07-24T20:40:00

? . Harmonizing to Shen and Liu ( 2004 ) , the absence of an established methodological analysis for using VM could besides be a clogging factor to its application. Following VM ‘s migration from the fabrication industry and its version into the building industries of different states at different times with varied aims, some states still lack a consonant guideline for its application. Bowen et Al ( 2009 ) noted that even when this is done, they seldom make attempts to benchmark it with other international patterns. For case, some practicians Shona Flannery2010-07-24T20:42:00

may happen the usage of qualified facilitators in a workshop state of affairs as adding excess cost to undertakings every bit good as clip devouring. This may ensue in either clients fall backing to an informal attack without an experient facilitator to supply a structured attack to placing clients ‘ value system. The consequence of this may non be so different from what is obtained through other direction techniques thereby oppugning the singularity of value direction. Furthermore, Green and Connaughton ( 1996 ) stated that good conducted VM surveies achieve about 10 % to 25 % nest eggs on the undertaking and prevents the possible clip that could be wasted as a consequence of frequent changes due to miss of proper apprehension of demands. This is evidently good compensation for a cost of approximately 0.5 % to 1 % incurred as a consequence of value direction surveies ( REF ) .

Cite this Value Management And Its Application In The Construction Industry Construction

Value Management And Its Application In The Construction Industry Construction. (2016, Nov 29). Retrieved from https://graduateway.com/value-management-and-its-application-in-the-construction-industry-construction-essay/

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