Download the Institute of Value Management Australia - Value Times Spring Edition 2016 11-12 May 2017 Germany conference : Value Management Practice 2017

Value Management Techniques

techniques

Ishikawa Technique (Fishbone Analysis).

Value Management uses a unique combination of concepts and methods to create sustainable value for both organisations and their stakeholders.

Some tools and techniques are specific to Value Management and others are generic tools that many organisations and individuals use. Detailed below is a summary of some of the main tools and techniques.

In terms of Value:

Value = Function / Objective ÷ Cost
i.e. Getting what you require ÷ for what you will pay

Value Management is a structured team based approach to identify functional requirements of projects / contracts to achieve Optimum Function for Minimum Cost

Description Benefits
Brainstorming of Mind Showering
Idea generation that focuses on creation of ideas by volume (no judging) Allows a large volume of ideas to be generated in a short period of time. Also strives to ensure all parties are involved - no ideas are discounted initially (later evaluation and filtering undertaken)
Cost Benefit Analysis
Used to analyse the costs of implementing something compared to the benefits to be achieved. Assists business case submissions. Often used in VM on procedure or process type projects. Can be combined with other tools e.g. process mapping, option selection.
Criteria Weighting Technique
A tool used to assist in option selection. Uses functional drivers (or objectives) that are weighted for scoring options against. Enables option selection and alternatives to be reviewed in order to support decisions being made.
Excursion/Metaphors
A tool used to take delegates on an outward and return journey (possible excursion). Moves delegates away from a problem to somewhere where creativity flourishes. The return journey often releases such creativity and ideas that would not normally be evident. Very effective in bringing creativity to the forefront. Often used as a precursor to brainstorming or other idea generation tools.
Function Analysis System Technique (FAST)
Identification of functions (at the heart of Value Management) of products, processes, projects or services. Focussed on client needs and wants. Determines what functions are delivered i.e. what they do or must do, not what they are (avoiding solution mode). The FAST diagram works by asking how the functions (primary and secondary) relate to each other by ask How and Why questions to check the logic works. Later costs are added to functions to assist in identifying any VM mismatches or areas of over-engineering.
Objectives Hierarchy
Diagrammatic process for identifying objectives in a hierarchical manner. Often used in conjunction with functions. Assists in focussing input where the key objectives are as the diagram is constructed in descending order.
Issues Generation and Analysis
A way of eliciting many issues connected with a problem or opportunity. Team members write down their issues on post-it notes and they are displayed on the wall under appropriate categories or groupings. e.g. Requirements, Constraints, Problems, Opportunities, Assumptions, Uncertainties, Risks Voting of the top 10 important issues follows. Actions to address issued then explored.
Pair Wise Comparison
Enables ranking of items by means of comparisons between all possible pairs of items. Enables option selection and alternatives to be reviewed in order to support decisions being made.
Pareto Analysis
Often called the 20/80 rule. Aim to concentrate on the top 20% of items that often have biggest (often 80%) impact. Focuses on those items or activities that can achieve the optimum
Process Mapping
Uses flow charts to review steps in processes Identifies processes in a diagrammatic format in a step by step manner. Often used in manufacturing of system type processes. Used to identify omissions or superfluous items in the process for correction.
Risk Analysis
A structured approach to identifying risks that could affect project, product, process or service success. Risks are identified, evaluated (in terms of cost, time, other impact) and robust action planning applied. Often used in parallel with Value Management as there are genuine links. Assists decision making or option selection.
SCAMPER
Used as a checklist to develop ideas by applying separate verbs to chosen ideas singly or together with others. E.g. Combine, Amend, Modify, Put to other use, Expand, Reverse/Reduce This could help with moving an idea from a creative thought to a more practical use, expand on the concept behind ideas, find different ways of expressing the idea, provoke new ideas, etc.
Stakeholder Analysis
Identifies those key stakeholders (groups of individuals) with an influence or interest in a project, product, process or service. Can assist in focussing attention where the priorities are required i.e. satisfaction of key stakeholder interests.
SWOT Analysis
Identifies strengths, weaknesses, opportunities and threats. A tool used in many organisations to assist in focussing activities where required and minimise those items that can impact negatively. Assists in understanding strengths, weaknesses, opportunities and threats that can impact on an organisation, individual, product or process.
Value Analysis
Structured team based approach to identifying functional requirements of projects, products, processes or services. Optimisation and maximisation or value to the client or customer. Optimum balance between function and cost without detriment to quality.
5 W's & H
A technique for exploring problems which provokes further depth of questioning about the dimensions framing the problem or opportunity. Who - e.g. is responsible?
Why - e.g. is the end date important?
What - e.g. what would happen if the scheme were delayed?
When - e.g. must the work start?
Where - e.g. might the problem occur?
How - e.g. might we do this seemingly impossible thing?

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