Essay About Value Management And Best Value

Value Management
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PRINCIPLES, PROCESSES, AND PRODUCTS
2.1 PRINCIPLES
2.1.1 What is Value Management?
Definition. The statutory and regulatory definitions encompass analysis of functions
performed by a team of qualified personnel directed at improving performance,
reliability, quality, safety, and life cycle costs of products, systems or procedures. The
study of functions helps to achieve “best value” for resources involved by improving
the relationship of worth or utility to monetary cost. The best value is associated with
an item that has the ability of performing its function at an optimum level of quality,
reliability, maintainability, and life-cycle cost. This analysis reduces processes,
equipment, facilities, services, supplies, or products to their most basic functional
elements and then looks for cost-efficient alternatives.
At minimum, proper value management practice will include all of following items:
identified initiatives
invested resources
implementable recommendations
identifiable return on investment
A summary view of value management is the systematic search for an undiscovered
answer through the collective efforts of a team composed of experienced and highly
qualified professionals. The goal of the VE analysis is to ensure that the owner, user,
and other stakeholders, receive a product that provides the greatest “value,” or return
on their collective investment. Value management processes and practices emphasize
the return on investment aspect in terms of life cycle costs to maintain or improve on
desired levels of capability and performance during planning, acquisition, execution
and procurement activities.
Integrated Product Team (IPT) approach. The reliance on a proper integrated
product-oriented team to achieve valuable results cannot be overemphasized in any
discussion of the definition of value management. Multiple teams may be assigned to
review an identified item in a highly structured VE study session or workshop. Teams
are comprised of knowledgeable staff representing many technical and operational
disciplines, including someone well-versed in value management practices, as well as
the client, user and other cognizant stakeholders.
Value Management GPG-FM-011
September 1997 3
Other Names. Terms such as function analysis, alternatives analysis, value analysis,
value control, value improvement, value engineering and value management are
synonymous, as long as the same industry-recognized techniques and principles are
applied.
Related Methodologies. Value management may be used alone, or in conjunction
with other management and productivity techniques and methodologies, such as: total
quality management, business process reengineering, partnering, bench marking, and
integrated product teams.
Related Good Practice Guides that include tools and practices closely allied with
value management include: GPG-FM-03, Engineering Trade Studies; GPG-FM-007,
Risk Analysis and Management; GPG-FM-10 Systems Engineering; and Utilities
Option Study.
2.1.3 What Value Management is not
Value Engineering is not what good planners and designers do as a matter of routine,
its not part of the typical design development process. A VE analysis is more rigorous
than the typical project review. Each VE effort brings together an impartial team of
professionals with a common purpose, improving the project design. The format and
structure of the value management methodology serves to aid both the owner and
designer with achieving their objectives.
Similarly, a VE analysis is not a traditional cost reduction approach. In a VE analysis,
cost reduction is achieved by making a design more efficient without reducing
essential performance, reliability, or maintainability. Conversely, traditional cost
reduction efforts will concentrate on material substitutions, and reducing or
eliminating specific elements. This approach frequently results with reduced quality,
or diminished performance.
Performing a VE analysis is not the same as a typical Quality Assurance (QA) review.
The traditional QA review will answer