From Value Analysis to Soft Value Management A Learning Journey

Roy Barton University of Canberra Queensland University of Technology The Australian Centre for Value Management

Roy Barton 2000

Structure of this Presentation f Hard and Soft Problem situations f Development of definitions of VA/VE/VM f Key Learnings from our actionresearch f Notions of value f Some applications
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Differentiating Hard and Soft Situations

A very soft problem What can we do about situations such as the Middle East ?

A very hard problem How do we repair this flat tyre?

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Hard Problem Situtaions Clearly defined problem boundary

Design and construct a new bridge

Note: The What has already been decided. The problem is How to.
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Soft Problem Situations Soft, fuzzy problem-boundaries

Allowing traffic to cross a river, taking into account environmental, heritage, cultural and social issues

The problem is What do we do?

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Traditional Value Analysis and Value Engineering

VA and VE have tended to addresses hard problem situations

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Setting up a road project

Road-user Organisation Utility agencies Funders Community Other users Road designers Traffic planners Road Authority Urban planners Government Construction authority Infrastructure Providers

Environment agencies

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Setting up a hospital project

Patients Health professionals Funders Hospital CEO Other users Designers Visitors Health planners Health Authority Hospital Board Government Construction authority Infrastructure Providers

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Development of VA/VE/VM Definitions

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Miles VA Definition

Value Analysis is a disciplined action system, attuned to one specific need: accomplishing the functions that the customer needs and wants... at the lowest cost.

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Value Management Definition - AS/NZS 4183-1994 A structured and analytical process which seeks to achieve value for money by providing all the necessary functions at the lowest total cost consistent with required levels of quality and performance

Definition from: Australian/New Zealand Standard for Value Management AS/NZS 4183:1994 Roy Barton 2000

Value Management
Value Management is a structured, facilitated, process in which decisionmakers, stakeholders, technical specialists and others work collaboratively to bring about valuebased outcomes in systems, processes, products and services
Barton (2000)

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Some Key Learnings during the action-research

y Need to focus on strategic and conceptual planning phases of projects y Need for integrated rather than coordinated outcomes from projects y Need for larger groups as for strategic and conceptual planning
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Some Key Learnings during the action-research

y Need for a more inclusive approach to value definition y Recognition of the inadequacy of v=f/c in defining value y Recognition of soft systems thinking y Shift from earlier to even earlier

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Some Key Learnings during the action-research

y Use of co-facilitators y Need for a consensus-seeking methodology y Formal (mathematical) methods are generally inappropriate

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Key words in the current state of play

y y y y y y y Integration Concensus Ownership Group decisions Learning Shared understanding Process-content facilitation
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Soft Value Management

fFocus on team/project learning fa large number of stakeholders (20-30) fCreating a participatory environment fEffective facilitation is pivotal to this approach
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The notion of Value

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Conventional VA/VE view of value

V=F/C

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Value for money relationship

Value for money

Function Cost

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What is Value

The value of an item must not be based on its price but rather on the utility which it yields
Bernoulli D. (1738)

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What is Value

Usefulness
(utility or function)

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What is value

Benefit

Usefulness

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What is value

Benefit

Usefulness
Importance

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What is value

Benefit

Usefulness
Importance

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What is value

Benefit

Usefulness

Importance

KK Women and Children's hospital, Singapore

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What is value

Benefit

Usefulness

Importance

Pacific Motorway Interchange, Queensland

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What is value

Benefit

Usefulness

Importance

Queensland Main Roads Intelligent Traffic System (ITS)

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What is Value

An ascribed attribute or property of something which is based on perceived usefulness, importance and benefit.

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Value for Money

Benefit Usefulness Importance

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Value for Resources Used or Exchanged

Resources

Benefit Usefulness Importance

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Value (for money) - another view

Usefulness

Benefit Worth Importance

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Key Value Questions

Is it Useful?

Is it beneficial?

Is it important?

Is it worth it?

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Key Value Question

Are these outcomes worth these resources?

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Examples of Soft Value Management Studies f Route selection, National Hwy NSW f TAFE Environmental Strategic Plan f Design brief for a new hospital, Singapore f Asset strategy for sports facilities, ACT
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