Value management is occupied with maximizing the value of the benefits delivered by the project or program. Since 'value' is a subjective term, it is important that a balance is maintained between the perceptions of different stakeholders and what value really means.
There are many different approaches to the value management procedure, but they all follow the same general principles shown below. This procedure initially covers the requirements management and solution development functions, but some aspects must be continued through the life cycle delivery phase.
Orientation
This step in the procedure is sometimes referred to as "framed". He establishes the terms of reference for the study of value management that typically includes:
Sometimes called data collection, this step is where information is defined, collected and distributed to team members. Relevant information should include:
The person responsible for the study will need to gather information from a variety of sources. This needs to be done carefully because the sources of information may have vested interests in the ordinary way of doing things.
Analysis
Many consider this step as the Heart of value management. The analysis can take a variety of forms to fit the technical nature of the project. The most common is an analysis of the function. The essence of this analysis is to look at the component parts of the project and decide what functions they perform. By identifying the function of each component, your contributions towards the benefits of the business case can be established.
Some projects will contain too many individual functions for all of them to be analyzed. The Pareto principle is worth applying here. It is very likely that 80% of the costs will be incurred by 20% of the components, so it makes sense to apply the full force of value management to that 20%.
Speculation
Alternatively referred to as the creative step, this part of the procedure is where creative meetings are used to explore alternative ways of achieving the same or better functionality, hopefully at a lower cost. It can also reveal components which in the present field are providing functionality not necessary.
Evaluation and development
Also called the step to judge. It examines the results of creative meetings to fully filter ideas that have the greatest potential.
These ideas are developed in substantial change proposals for changes in the technical specification. All the implications must be considered in what effect the proposed changes will have in terms of schedule, cost, quality, risk, etc.
Recommendation
Sometimes referred to as the reporting step, this is where developed ideas are sent to interested parties with a recommendation and justification for the required investment. Proposed changes are selected and approved for implementation.
Implementation and feedback
Finally, the accepted proposals are updated updating the specifications and the business case. The principles of value management must be continuously applied during the control of the project and as part of the control of changes to ensure that the work continues delivering the best value for money.
There are many different approaches to the value management procedure, but they all follow the same general principles shown below. This procedure initially covers the requirements management and solution development functions, but some aspects must be continued through the life cycle delivery phase.
Orientation
This step in the procedure is sometimes referred to as "framed". He establishes the terms of reference for the study of value management that typically includes:
- Set the objectives for a value management study;
- Definition of the composition of the study team;
- Profile of the information on which to base the study;
- Consultation with the template;
- Planning in detail; and
- The decision on the use of professional assistance.
- information
Sometimes called data collection, this step is where information is defined, collected and distributed to team members. Relevant information should include:
- Architecture/engineering plans;
- Specifications;
- Details of the suppliers;
- Methods Manufacturing, development or construction currents;
- User requirements;
- Market trends; and
- The competition
The person responsible for the study will need to gather information from a variety of sources. This needs to be done carefully because the sources of information may have vested interests in the ordinary way of doing things.
Analysis
Many consider this step as the Heart of value management. The analysis can take a variety of forms to fit the technical nature of the project. The most common is an analysis of the function. The essence of this analysis is to look at the component parts of the project and decide what functions they perform. By identifying the function of each component, your contributions towards the benefits of the business case can be established.
Some projects will contain too many individual functions for all of them to be analyzed. The Pareto principle is worth applying here. It is very likely that 80% of the costs will be incurred by 20% of the components, so it makes sense to apply the full force of value management to that 20%.
Speculation
Alternatively referred to as the creative step, this part of the procedure is where creative meetings are used to explore alternative ways of achieving the same or better functionality, hopefully at a lower cost. It can also reveal components which in the present field are providing functionality not necessary.
Evaluation and development
Also called the step to judge. It examines the results of creative meetings to fully filter ideas that have the greatest potential.
These ideas are developed in substantial change proposals for changes in the technical specification. All the implications must be considered in what effect the proposed changes will have in terms of schedule, cost, quality, risk, etc.
Recommendation
Sometimes referred to as the reporting step, this is where developed ideas are sent to interested parties with a recommendation and justification for the required investment. Proposed changes are selected and approved for implementation.
Implementation and feedback
Finally, the accepted proposals are updated updating the specifications and the business case. The principles of value management must be continuously applied during the control of the project and as part of the control of changes to ensure that the work continues delivering the best value for money.
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