VM for PM - How Value Management Strengthens Program Management and Client Trust

Scot McClintock
When you anticipate issues, or if problems arise unexpectedly on your projects, having a Value Management (VM) Services Team as part of your toolbox will help you reach thoughtful decisions. The team makes decisions based on consensus to solve those problems.

Encounter a tough design decision? Risk Management just identified project risks? An agency requires you to perform a value engineering (VE) study? A company that offers VM services has the answer.

VM boosts your project’s overall performance by aligning resources with requirements. Using this function-oriented approach early on helps identify the project’s value objectives and answers the question: “Are we doing the RIGHT project?” Later in the project, VM addresses value by answering the question: “Are we doing the project RIGHT?” In either case, VM highlights value mismatches, facilitates consensus building, encourages innovation, optimizes design and strengthens decision-making to deliver the best solution.

Faithful+Gould was providing project management services on a series of upgrades to the Billie Jean King National Tennis Center in Queens, New York. Included in the upgrades was a retractable roof over Arthur Ashe Stadium. The retractable roof was the biggest upgrade, featuring a flexible, translucent plastic material stretched over a steel frame and supported by eight steel columns surrounding the stadium. The project management team scheduled a VM intervention and over four days, our team collaborated with the project team and stadium experts to ultimately deliver a peer review of the current design to help assure the client that the project provided the necessary functionality within the cost and schedule parameters. The client and PM considered the VM intervention very beneficial.

In other cases, a client may request a VM intervention. This was the case for the Annapolis Water Treatment Plant project in Annapolis, Maryland. Although the VM intervention was required by the client, it was not fully accounted for in budgeting project services. We worked with the PM to organize and facilitate a cost-effective three-day VM workshop with very short notice for a 30% design-build submittal. The meeting resulted in 55 creative ideas which led to 24 VM alternatives and maximum potential savings of over $2 million in capital cost and $4 million in life-cycle cost. The VM intervention produced results for both client and the PM.

Neither one of these cases was envisioned at the start of the project, but VM proved beneficial. Purposely including a VM intervention when planning your project is ideal. Use VM as a “value planning” exercise at the onset of a project to build consensus among stakeholders on expectations. Value-based decision making is a strategic tool considering functions to help clarify or set project purpose, goals and objectives. VM identifies needs versus wants and prioritizes those needs. This enables the team to think more clearly and carefully about the challenge and leads to innovative solutions.

Plan value studies for agreed-upon stages of the design process, using the design team and key project stakeholders as the VM team, or a totally independent VM team of appropriate subject matter experts, or a combination of both. VM studies using the design team could provide on-going team building and confirmation of project direction. An independent facilitator can guide the design team to effectively revisit and reconsider any selected areas of study while an independent VE team can bring a new set of ideas and experiences to the project.

Use the process to expand the solution set quickly. Then through a focused assessment, find the acceptable “best value” approach. VM will often provide more innovative approaches as it improves on the baseline solution, using tools such as cost models and performance measures to focus on specific issues during the VM study. Any misalignment of a submittal with the initially established benchmarks establishes targets for the study and can guide the required effort of the study. Finally, VM can be used as a tool for constructability review at the end of design.

Use VM to manage your projects throughout design to help achieve required project performance on time and within budget. If the design team and the project stakeholders all start out in the same direction, design will proceed more smoothly with fewer fits and starts and more built-in quality. You will succeed within your design budget and the satisfied client will be back to you with their next project.

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