VA Presentation Budapest Wilhelm Hahn Final 010401

8/17/2019 VA Presentation Budapest Wilhelm Hahn Final 010401

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VM/VA Competence

Center, Germany

Value for EuropeValue for Europe

The European VM Training &

Certification System

Value Analysis

A good practice for elaborating result-oriented newmethodology

ipl!-"ng! #ilhelm $ahn

President of the European Goerning !oard of the VM Training & Certification System "EG!#

Chairman of the VM Cert!oard of the Association of German Engineers "V$%#

Proect Manager, M!tech Consulting Gm'(, Sindelfingen, Germany


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Content

(istory of Value Analysis and the concept of Value%

Value Analysis Methodology&

*unction+Analysis and *unction+Cost+Analysis'

( Proect eamples in the pu'lic administration sector

) -egulations in the .SA and status of use in Europe

* European Training & Certification System for Value Management


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efinition of Value Analysis according to +awrence ! ,iles

Value Analysis is an organied effort to proide re.uired functions of a product at lowest overall cost

consistent 0ith achieing the re.uired .uality, performance and mar1et acceptance

Value analysis is not a cheapening process. Reliability and performance are not sacrificed for the sake of

cutting cost

Value Analysis 0as deeloped in the late 2345s 'y 6a0rence $7 Miles7 (e 0or1edin the purchasing department of General Electric Company in the .SA

Value Analysis 0as a response to the 8uestion9 (o0 had companies managed toinnoate during :orld :ar %% despite of rationed materials and 0ar time shortages

Miles presented a model on the idea that ;All cost is for function


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Value is the relation between the satisfaction of needs and theresources which are used to achieve a desired satisfaction

2 The sym'ol α indicates that the relation 'et0een the satisfaction of needs and the use of resources is a 'alance7 !oth factors hae to 'e 0eighted against each other to achiee the 'est alue7

Value %Satisfaction of needs

(monetary and non-monetary 1

2se of resources(money, people, time, energy and materials)

3 3Benefits

E4penditure

5unctions

Costs

%ntegration of more functions alongside 0ith a lo0 cost+increase

Cost reduction, 0ithout changing functions

-emoing unnecessary functions and their costs

%ntegration of more functions alongside 0ith a cost+reduction

Balance between sta6eholders

Balance between use of resources

B a l a n

c e b e t w e e n

b e n e f i t s

a n d

e 4 p e n d i t u r e

Various optionsto increasevalue

Source9 European Standard E= 2)3> Value Management


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Value Analysis is characteried by four 6ey elements

5unction-Cost-Analysis

Structured Approach with%7 Steps 8VA9VE :ob ;lan1

5ocused Team Effort

Creativity

5 2 ) 4 @ > B 3


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#ith the VA :ob ;lan of E< %& =>' functions and cost of VA ob?ects areanalyed and optimied in several phases and %7 steps

;ro?ect efinition+ %dentify re8uirements

+ Ma1e target cost plausi'le

)

(!&

=

"nformation phaseSituation As-"s

efine targets in detail

"dentify value 8cost1 drivers

Collect and generate ideas

;lan and implementselected concept

Match

Evaluate ideas

ualitatie & 8uantitatie ealuation

A n a l y s i s

@ S p e c i f i c a t i o

n V

e r i f i c

a t i o n

Validation

;ro?ect preparation

;ro?ect planning

5unction Analysis

*

evelop solution concepts>

%mplementation control

Comparison to situation As+is

;resent concepts for decision ma6ing

'

%

7

&

(!% (!'

%mplementation Phase

Analysis and $efinition Phase

Concept Phase

VA :ob ;lan E< %&=>'

Source9 %nterpretation of :7 (ahn 'ased on E= 2)3>


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A function description which is neutral in regard to solutions willincrease the room for creativity and new solutions

connect Sheets

hold sheets of

paper together

Situation As-is

+evel of 5unctions

+evel of Transformation

+evel of Solutions

;aper Clip

Situation To-be

connect Sheets

to stic1, to glue, to riet,

to staple, to clamp, toturn do0n corners,

to put in a hose, D

#hat does it do D

'y accident

; r o c e s s o f

A b s t r a c t i o n

#hat e4actly does it doD "n what way elseD

5older Clamp

"f you want to solve a problem detach yourself from the problem first

D

clip Sheets


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Customer functions are transformed and detailed to technicalfunctions with a $ow- and #hy-+ogic to stimulate creativity

E4ampleF5unction Tree of a&-ways $ead est ofa passenger car

$owD #hyD

support

(ead

protect

ccupant

adust

(eight

fi

(eight

gie

Comfort

Customer related functions

#hat are the needs of usersD

;roduct related functions

$ow can these needs be fulfilledD

transmit

*orce

create

Emotions

proide

=otches


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2)

Application of VA in administrative topics has often further advantagesbesides the improvement of the cost efficiency of processes

Advantages and effects

% Simplification of administration processes

& "ntegration of new scopes of action

' ecision support for politicians and themanagement of administration processes

;rocessing of cross-sectional topicswhich concern many administration levels

Transparency in topics

Sustaina'le changes

Moderation of arious sta1eholders

Efficient process design

Clarification of ho0 to communicateand cooperate cross+sectional

Precise definition of responsi'ilities

Conflict resolution in organiFations(

E4amples of VA ob?ectives


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Thomas E! Berg

Es geht ums

Ganze 22

;ro?ect e4amples of 5Hhrungsa6ademie Baden-#Hrttemberg

5ounded in %=* for the further-education of high-potentials in the stateadministration of Baden-#Hrttemberg! ,eanwhile over (77 graduates

Since &77% competence center for organiation and human resource development ofthe whole public sector of Baden-#Hrttemberg

Coaching of e4ecutives and institutions in change processes and development of

strategic goals in the public sector! /ptimiation and .uality improvement ofbusiness processes

5acilitation of over %&7 Value Analysis pro?ects in the past &7 years

V" "nnovation Award V, &77

/ptimiation of the forcedsales process of real estate atthe district court of +oerrach0

Germany

V" "nnovation Award V, &77>

evelopment of the ambulantservice areas of the Badischer

+andesverband for prevention andrehabilitation of addicted people

&77*F /ptimiationof school office

processes

&7%7F eorganiation oflaboratories of the

+andesanstalt fHr 2mwelt0,essungen und


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A VA potential analysis can be used to clarify underlying conditions0the feasibility and profitability of a pro?ect I and to set priorities

Sub?ect-specific potential

;ro?ect goal andtas6

2nderlyingconditions

Emotional potential

VA-5acilitator

;otential of methodology

Specific approach and methods

-eset of proect team7 %ntegrationof eperts7

-eision of start time of proect Pull in of additional information Cancellation of a proect or

integration into another one

thers

esults

Sufficient compleity of theassignment for VAH

Potential to approach 0ith VAH Priorities in case of seeral

competing proect proposals

Ad?ustment of pro?ectsituation before start ifre.uired


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2nited States I ;roactive application of Value Engineering in theGovernment is regulated

2S - 5ederal Ac.uisition egulation 8%==*1

Pu'lic 6a0 I2544@5 Act, Section 45 re8uires Value Engineering for

*ederal Agencies

Each eecutie agency shall esta'lish and maintain cost+effectie

Value Engineering procedures and processes

Source9 http9//00070hitehouse7go/om'/circularsJa22/I2, http9//0007glo'alsecurity7org/military/li'rary/congress/233Jrpt/h2544@57htm

2S Circular


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2nited States I VE Studies in 5ederal-Aid $ighway ;rograms show anaverage eturn on "nvest of %=&F% for 5J &77( to &77=

5J &77= 5J &77 5J &77> 5J &77* 5J &77) 5J &77(

'& '%* &)% '77 '&(

Cost of VE Studies ;lusAdministrative Costs

K%>0% ,il! K%&!' ,il! K%&!) ,il! K!%) ,il! K=!7 ,il! K>!> ,il!

Estimated Construction Costof ;ro?ects Studied

K&=!& Bil! K&=!* Bil! K&(! Bil! K&%!) Bil! K'%!* Bil! K%!> Bil!

Total > >='

Value of Approvedecommendations

K%!> Bil! K&!)& Bil! K%!=> Bil! K%! Bil! K'!& Bil! K%!% Bil!

eturn on "nvestment ==F% &7)F% %)>F% &%=F% '&)F% %()F%

/" AverageF %=& F %

Source9 http9//0007fh0a7dot7go/VE/

EuropeF There is no governmental regulation for the application of VA

"n the private sector VA becomes more and more popular but no figures 6nown

http://www.fhwa.dot.gov/VE/http://www.fhwa.dot.gov/VE/


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;articipation in a V,9VA-;ro?ect

+eading V,9VA-;ro?ect

; r a c t i c a l e 4 p e r i e n c e

V, ,odule &

;rofessional in Value ,anagement 8;V,1

Train theTrainer

V, ,odule %

5urther training

TV,

V, ,odule '

LVA

%! e-Certification ;V,

;V, ;rofessional in Value ,anagement

TV, Trainer in Value ,anagement

LVA Lualified Value Associate

A European training @ certification system for VA facilitators does e4istalready - VA e4perts are available in many member states

Source9 EG!, Value for Europe, structure of training and certification


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)5

EG! o'serer "participates in meetings#

EG! mem'er country

ther E. countries


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)2

Bac6 up


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The VA :ob ;lan provides a guide and frame for the application ofade.uate VA techni.ues and other methods and tools

;hase Thought process N ;hase .uestions ,ethods9Tools E4amples

;reparation

#hat is the problem and whyD #ho is involved and necessary to solve itD 2ntil whenD

Luotes to client Budget

esource ;lanning ;ro?ect ,anagement

"nformation

#hat is the status today 8As-"s1D

#hat functions are being performed todayD #hat do these functions costD

Sta6eholder analysis

5unction-Analysis 5unction-Cost-Analysis

efinition

#hat is the targeted status 8To-be1D #hich functions are re.uiredD #hat should these functions costD

Sta6eholder analysis Target Costing

Creativity #hat other ways are there to accomplish the re.uired functionsD

Creativity Tools

Evaluation #hat will the alternatives costD #hat is their feasibilityD

Classification N ;rioritiation0 is6 analysis0 Lualitative N.uantitative

evaluation

;resentation ecision and approval by the clientD ;resentation

"mplementation Target 5unctions and target costs achievedD ;ro?ect management 5ollow up tools

V a l u e A n

a l y s i s : o b ; l a n

V a l u e A n a

l y s i s C o r e T e a m


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The application of Value Analysis yields in general to an improvementof the As-is-Situation

%

&

(

'

Cost reduction

Serice improement

%ncrease of effectieness andefficiency

Process optimiFation

-eduction of process time

%nnoatie solutions

uality orientation

)

*

is applicable for products0 processes0 andservices in many different areas

involves team members cross-functionally

drives cost oriented thin6ing

encourages creative new approaches

results in holistic and sustainable solutionconcepts

enhances competences of team membersand fosters the organiational development

5ields of application and effects Value Analysis O


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)4

5unction-Cost-Analysis spreads the component cost to the relevantfunctions to identify the function cost and the function cost drivers

$ow to spread the cost of components to the functions 8see e4ample1F

Ta1e a component and mar1 all functions 0hich the component contri'utes to

Estimate ho0 much of the cost of this component can 'e assigned to each of these functions Continue 0ith the net component

The total leads to function cost7 *unctions 0ith the highest cost are the cost driers

Challenging the cost driers 0ill focus on the releant functions to improe the alue


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e.uired corecompetences

,anagement competence Proect representation and argumentation

Nno0ing and maintaining interfaces

-eporting to decision ma1ers

Nno0ing and use of constitution la0s of enironment

Change management

Conflict management

+eadership competence 6eading 0ithout authority

Nno0ing and using group dynamic

%dentifying and soling conflicts

%dentifying, using and supporting s1ills

6eading and moderating discussions

Technical-0 methodicalcompetence Nno0ledge of 'ranches, products, process7

Mar1et+ and customer analysis

Mar1eting and controlling

uality control and documentation

!usiness administration & legal 1no0ledge

VM+Methods "*unctions, costs, creatiity,

ealuation, presentation#

ther methods

Socialcompetence

Communication 'ehaior9

actie, partner oriented, clear,

understanda'le, analytical und

appropriate

;ersonal competence Self+confidence

Customer orientation

Stress resistance and a0areness of the o0n

conflict+'ehaior

Self+organiFation

Curiosity, openness, constructie thin1ing

Basic re.uirementsF technical0 business und organiational 6now-how

5acilitation of VA pro?ects re.uires a high degree of core competences I specific training to develop these competences is needed

Source9 V$% )B52, !latt 2 u7 )


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The EGB is the European association for the Value ,anagementTraining @ Certification System 8Value for Europe1

$istory rigin9 SP-%=T Program of the European .nion 23B3+3 "Strategic P-ogram for %=noation and

Technology Transfer# to enhance the European infrastructure for innoation through transnational

net0or1s7 VM (and'oo1 pu'lished in 233@

E= 2)3> pu'lished 2333 in English, )555 in German7 *oundation of the EG! as an informal committee

in une )555

*ormal registration of the EG! as an organiFation according to the *rench la0 in une )554 in Paris7

-eason9 Closeness to A*=- "Association franKaise de normalisation# and CE= "ComitO EuropOen de

=ormalisation#

/b?ectives Common European Value Management Standard

Common European formation and certification system, its superision, 8uality monitoring, deelopment,

deployment in Europe

-epresentation of European countries in glo'al VM Topics

Actual

tas6s in

&77=

-eision of ;Value for Europe;7 %ntegration of the eecuted changes since )5557 Simplification of systems

and adaptation of re8uirements7

Start and steering of tas1forces in CE= TC)>39

27 -eision of E= 2)3> 0ith the target to create an %S+Standard

)7 =e0 guideline for the implementation of Value Management

7 =e0 standard for the method *unctional Performance Specification "*PS#

Documents

VA Presentation Budapest Wilhelm Hahn Final 010401