Value-Driven Project Delivery

October 14th, 2011

Assessment

 

Clearly understanding the needs and requirements of clients is critical to delivering successful projects. The first step is to determine the goals for the project. A thorough investigation of all the shared aspirations of team members and stakeholders need to be documented. These aspirations should then be categorized into segments with similar requirements. The next step is to analyze the value that the various segments contribute to the overall project success.

Stakeholders for projects include owners, users, vendors, trades and design disciplines, maintenance, operations and capital asset management. These parties should be consulted for input, such as requests for functional design requirements, enhanced data relating to installation requirements, material availability, operation and warranty data, and sustainability goals to help better define the project targets.

Wherever possible, this information should be converted into metrics that will answer questions such as:

  • Who is asking for this particular information or activity?
  • How much impact will there be for not having this information?
  • What is the potential risk reduction these services provide?
  • What kind of increased efficiency will this service or technique deliver?
  • How does this request support the project goals and objectives?

As you define potential goals and service relationships, quantify the benefits to the client, such as improvements in the performance of the client’s own products or services, and cost and time savings. Then look at the value each potential service can provide to your business in the form of revenues, profits, increased efficiencies, reduced errors, and resulting market share, among others. The importance of increasing the efficiency of all participants is more important than activities that enhance only one or a few participants. Where the same activity delivers value to multiple parties you leverage effort to create greater overall value to the project.

Finally, quantify the risks involved in each potential initiative. Risk factors to be considered include effects on design, economic effectiveness, time, technological viability, and environmental impacts. These risks should also be presented in a scorecard used to assess their acceptability to the team members.

Assessment begins the process of defining the requirements of a project. Clear communication between all the parties is required for success. A process known as dialog mapping focuses conversations toward consensus during the entire delivery cycle. Open conversations pointed toward solutions reveals the differences in language and meaning different stakeholders bring to a project. Dialog mapping reveals those differences and replaces assumption with clarity allowing more efficient, clear communication between stakeholders.

Alignment

Alignment is a function of aligning project objectives between the parties with the overall goals for the project. Alignment of objectives is a key factor to providing effective delivery in any project effort. Peter Drucker is quoted: “There is no loss to the customer by eliminating activities that do not add value.” Therefore, all activities in the project should be aligned to creating value to the project.

Agile management theory has a major tenant that all work scheduled should be aligned to creating the greatest value in the moment for the project given adequate information to determine the work. This alignment of information, resources, and agreement is the foundation of efficient project delivery. Establishing these goals provides an effective tool for communication across the boundaries of all the stakeholders in the project delivery.

Where goals are aligned with delivering the greatest value to the project during the entire project duration, all participants realize the greatest potential for profit and positive return on investments. These goals become the central tenants of communication through all participating organizations. Understanding these mutual goals will allow all the participants to better prioritize their time and other resources. Now every team member can focus on delivering value through their activities that contribute most to the value needed at any given point in time, eliminating those activities that do not add value.

Achievability

From the time a project is first considered until it is delivered, its achievability should be continually evaluated against the goals for the project and team participants’ capabilities. Planning aimed at developing delivery mechanisms that achieve the highest value at the moment of need creates the most effictive model of project delivery. As new elements are needed for a project, they should be evaluated against team resources and capabilities. For the best solutions, evaluate multiple mixes of initiatives to determine which one provides the maximum value to the project.

Human and financial resources should be focused on those ideas that deliver the most value to the owner and the team. It is important to continually evaluate whether or not the work can be delivered within the right time frame and the right cost. Modeling time, resources, logistics, and cash availability in concert with the physical models are required to determine the right mix.

Achievability is a mix of both capability and proper planning to deliver the highest value elements at the right time.

Accessibility

Making information accessible to everyone involved with the project lifecycle is critical to value-driven project management. Too often, each group involved in the initiative creates its own repository of information that is hidden from other participants.

An information portal for the product team can provide a single source for work completed. The portal should provide the ability to view the entire project portfolio, from graphic to written and multi-media file formats. Role-based dashboards can enable all stakeholders to view progress and comment on proposals and work-in-progress.
Bringing information together in an ideal project portal should increase visibility of requirements, goals, cost data, design performance, and other project-related information. Logistical analysis can show the tradeoffs between different design or construction options.

By having all information in a central location, the collection, delivery, and review of information are expedited. Each participant can review and contribute information and be assured that others will have access to their contributions without having to spend time with email distribution or difficult software interfaces.

Agility

Agility is expressed in more than terms of organizational flexibility in the architecture, engineering, construction and operations vertical market segment. Each of these vertical professional efforts traditionally have operated in their own silo of influence. It is rare for these professional segments to overlap as an integrated delivery platform. Our heritage of project delivery has not changed for more than 200 years. Since we share a common legal heritage with England, our common law-based system is largely unchanged. An adversarial relationship is the basis of common contract law. This common heritage continues to persist in every phase and part of the delivery process for buildings and infrastructure projects. To make any advances in this business, we have to get all the parties out of their silos and bunkers and out on a field of interaction.

That segmentation has led to significant waste in time and material, and results in additional project cost. Both the construction and design communities have been trying to find new management methods to bring efficiencies to their respective professions. Agility has recently been expressed in the design effort as flexible, chaos management, based on Scrum or Agile management methods. In the construction industry, a page has been borrowed from the management practice of the manufacturing world and repurposed lean manufacturing into lean construction.
While both management practices are based on the same theory of flexibility, team solutions, and creating the greatest value within a timeframe, the resulting efforts are largely the same with more flexibility in work scheduling and less risk in performing work that is incorrect. Inherent in both of these efforts is a continuous quality loop that stresses quality assurance with each unit of work that is produced. A concept of task/test is a foundational concept.

Accountability

Collaborative teams are built on the premise that the members are all willing to accept responsibility for their own actions. Without accountability there is little, if any, chance that the effort will be value-driven. Using continual work testing against agreed- upon standards provides a significant basis for consistent value delivery.
The premise of both Agile and Lean theories is based on that effort—quality, time, and budget are all elements of every work effort. By naming the standards and expectations for each work effort and how it fits with the adjacent work elements will determine the highest possible value delivered. The importance of getting the high-value work in place overrides the traditional work division methods of the past. Now the entire team is responsible for delivering the work effort in the most efficient manner possible.
Without clear objectives and commitment to achieving these objectives, successful delivery is unlikely. But where there is consistent language that supports the objectives and available data to support decision-making, successful results are much more likely.
The greatest successes are built on two bridge buttresses: cooperation and reliable data spanned by action.

Benefits of Value-Driven Projects

Many have questioned the validity of value-driven projects built around collaboration. After all, many of us have been working closely with other professions and disciplines for quite some time. The results of these efforts have largely been hit-and-miss. Often these efforts were hardly organized or had any expressed objectives, goals, or open discussion about the responsibilities of the participants.

True value-driven efforts have several distinctive attributes.

1. A complete team is brought together for a declared purpose.
2. Goals and objectives are mutually agreed upon, which become the 'ground stakes' that govern further decisions.
3. Incentives are derived to reward those who uphold the objectives of the project and move collaboration forward for themselves and others around them.
4. Risk is shared by those who have the ability to bear and influence it.
5. Decisions are made by those who have the best experience and information, not just because it is the traditional way.
6. Focus on the productivity of a team as a whole rather than transactional activities of individuals.
7. The elimination of waste and corrective work are always high priorities achieved through multi-disciplinary planning and investigation.
8. Technology is a tool for progress, not a crutch for excuses and failure.
9. Information is the basis of decision-making. Information is shared by the entire team. Each party has a vested interest to create, share, and use  highly available information created by the team members.

Conclusion

This paper has explained the concept of value-driven project delivery and how it can help you create successful projects. With value-driven project delivery, you:

  • Declare the staged goals and objectives of each project.
  • Build a team based on consensus and collaboration.
  • Share both risk and reward equitably.
  • Capture information and make it accessible to the entire delivery team.
  • Maintain the agility to rapidly adapt to changing circumstances.
  • Maintain transparency in tracking and accounting for the results of every initiative.

With these best practices, you can deliver projects that deliver the highest value to owners and users of the BUILT environment.

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