IHEA Qld – 2007 Mid-Year Conference

Project Development – Value Management

20 July 2007

Michael Ord

Background

• MO: QWRC, Contractor experience, PM consultancy, Shareholder of PM consultancy (Health Capital Works Projects), PB Senior Project Manager,

• Value management process, Practical Philosophy

• PB: 10,000 staff worldwide, Qld 450 staff, diversity of services

Presentation detail

• Leave you with two key thoughts: Perception – how significant is this aspect? Value management (making it work for you)

• Use the SE Qld water crisis as example of challenges relating to perception and project complexity

• Analyse perception – de Bono

• Value management – opportunity to improve outcomes for hospital engineering

Water example – making you think about perception

Glass 1 -

Glass 2 -

Glass 3 -

Glass 4 -

Glass 5 -

Glass 6 -

Dam storage water

Tap water (treated Glass 1)

Wastewater (tertiary treated)

AWTP water (recycled Glass 3)

AWTP shandy (mix of Glass 2/3)

Indirect potable reuse (mix of Glass 3 & 1 treated)

Perception: extracts from ‘I am right you are wrong’ – Edward de Bono

• Perception: an attitude or understanding based on what is observed or thought.

• A belief system is a way of perceiving the world that prevents us from testing the validity of the belief. Belief systems create perceptions that reinforce the belief system. They can be so powerful that people are prepared to give up life itself for their beliefs.

Perception: extracts from ‘I am right you are wrong’ – Edward de Bono

• There is no truth in perception. It is always from a point of view. It is never complete.

• Understanding perception has a very high practical value because it covers most of our thinking outside technical areas.

• The only truth in perception is the ‘truth’ of belief systems. Beliefs arise very easily from the circularity phenomenon in the underlying system. As we understand how beliefs arise and how they are sustained we can see why logical arguments will not touch beliefs, prejudices and faulty perceptions. This is of great practical value, since various belief systems are a major component of human affairs.

Perception: extracts from ‘I am right you are wrong’ – Edward de Bono

• Critical thinking and argument have been our basic attempt at progress in the classical thinking system and permeate society (law, politics, science, etc). Critical thinking and argument are based on the notion of ‘getting to the truth’. There is total lack of the design and constructive element needed for progress. The needs of today are different from the needs of Greek discourse or medieval theology.

• There will be major crises which will force change. Politically, change forced by a crisis is much more acceptable because it is obvious that something must be done – and surviving a crisis is an achievement enough.

The Concept of “Value for Money”

Importance

Benefit

Usefulness $

$

$ Option A

Option C

Option B

Value Moneyfor

Value Management - Constructive Overlap

Designers

Waste

Environmental

Hospital planning Risk

Patient Care

Health & SafetyInfrastructure

Community

Hospital owner

Marketing

Mechanical

Operations – Hospital Engineering

Value Management Study

• Stage 1 Pre-VM workshop activities• Stage 2 VM workshop• Stage 3 Post workshop• VM workshop process

Information phase Analysis phase Creativity phase Judgement phase Development phase

Value Management – Hospital Engineering involvement

• Pre-workshop stage – provide hospital engineering details and issues

• Ensure you allocate time to attend the VM workshop

• Have your say You are an important stakeholder. You have to operate and maintain the asset

Value Management - Revised Australian Standard AS4183-2007, Section 3.1 page 11

• In Value Management Studies, substantial advantages arise from the interaction of group members and overlap of their knowledge and experience.

• The success of VM studies depends upon the appropriate application of five essential elements: A prescribed work plan; The mix and commitment of group members; Management of value management studies; Senior management commitment and support; and Effective facilitation.