The Value Chain

The value chain is influenced by the value systems of the organisations.
A value chain is formed when the understanding of value held by those performing sequential activities is aligned, with each each activity adding more value to it.
By aligning the understanding of value, gaps in workflow and rework are avoided which make the chain efficient.
An aligned project value chain must mirror the changing nature of work performed as the project progresses.
If this is not achieved, the perceptions of value associated with the different construction stages will become disconnected.
A building design that was perceived to offer value at one stage may not be perceived to offer value at the next which could result in rework/delays and potentially dissatisfied stakeholders or supply chain members .
The understanding of value at a strategic levels developed in early VM workshops must be translated into the tactical project and subsequently, into those operating the building.
At strategic level of an organisation, the construction project must reflect corporate values, which will be implied by the business's mission statement.
The corporate value must be aligned with the business value by clarifying how the the project will interact with other parts of the procuring client's business.
The project value chain is then assembled to map business value into the various views of value held at each stage of the tactical construction project.
Achieving operational value (i.e. project fulfils its required role) requires all stakeholders' expectations of value to be translated through the project value chain to this final outcome.

Dual VM Workshop Roles

Periodic VM workshops must maintain an evolving understanding of value through the value chain by performing two roles:

They must provide a forum so that stakeholders can update their common understanding of value in response to evolving project work and any changes in project context.
They must convey the updated understanding of value to the guide those performing subsequent value chain activities.

The Need for the Workshop Forum

Workshops establish the social setting required for stakeholders to communicate to socially construct common understanding.
Sufficient understanding of value cannot be gained by other communication methods other than direct, face to face communication.
Workshops provide a forum for stakeholders to use analytical tools under the guidance of a facilitator to develop a socially constructed understanding of value.
Workshop tools are designed to stimulate this debate to reveal the consequences of stakeholders' underlying values.
Workshops are pivotal for making compromises and reaching a satisficing solution.
Workshops establish equality of stakeholder views by the facilitator ensuring all are equally engaged and contribute to the developing understanding.
Workshops establish a socially 'safe' space to explore idea & contribute thoughts without the fear of a view being judged or considered wrong. Achieving this situation as a facilitator is essentially for the social construction of understanding.

Value Management Study Styles

Study Style 1 - Value System Audit (independent value manager)
Study Style 2 - Value System Reconfiguration (independent value manager)
Study Style 3 - Value System Audit (independent value management team of specialists)
Study Style 4 - Value System Audit and Reconfiguration (independent value management team of specialists)

Study Style 1 - Value System Audit

Used to understand the nature of value to the client body.
Undertaken by an independent value manager
Helps project stakeholders understand the problem.
Does not emphasise solving the problem.
Stakeholders' motivation moves project onwards.
Construction project confirmation and formation.

Study Style 2 - Value System Reconfiguration

Used to verify and challenge the project value system.
Undertaken by an independent value manager
Facilitator helps stakeholders in challenging assumptions about value systems and likely solutions.
Project briefing leads to concept design verification.

Stage 3 - Value System Audit

Used to confirm value system compliance.
Undertaken by an independent value management team of specialists.
A rare format in the UK.
Validates technical system design.

Step 4 - Value System Audit and Reconfiguration

Used to audit and redirect technical system compliance.
Undertaken by an independent value management team of specialists.
External team of specialists address technical issues.
Applied value engineering would us an internal team.
Used to respond to problems in technical system design.

Value Creation

Opportunities for value creation decrease as a project progresses from design brief stage through construction to occupancy.
Cost of design changes increases as projects progress.
Design and build contracts limit the ability to reflect client values throughout the design.

	Created by d.moran-10 over 10 years ago

Undergraduate Value Management & Engineering Note on The Workshop Approach, created by d.moran-10 on 02/06/2014.