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11 Essential Steps to Value Creation Nirvana


One of the biggest wastes on a project can be the cost and time delays caused by projects going over budget and having to delay the project to go through a value engineering process that strips all of the VALUE our of the project. This occurs on traditional projects as the Owner, contractors, trades users work in SILOS with minimal collaboration on value creation.

Target Value Design

Unlike traditional design processes where design, budgeting, and then redesign are an iterative process, a target value design process uses immediate feedback on scope, budget, schedule and quality to inform the development of the design. By adopting a dynamic decision making environment the team can be proactive in determining the needs and wants that will fit into the budget and make the necessary adjustments.

VALUE is not just performance delivered, it is performance delivered at a cost. Target Value Design promotes designing to a detailed estimate, rather than estimating a detailed design.

The value creation process is really straight forward. Get teams out of there silos, collaborate on what represents value and continually test the solution to the cost the customer is willing to pay. With the right team delivering customer value NIRVANA can be achieved.

The Target Value Design process is relatively straight forward:

  1. Clearly defined Owner's Project Requirements (The Value Proposition) this includes many things including functionality, cost, sustainable performance ....

  2. Hire the best team based upon qualification for delivering a collaborative high value project, on time and to budget. This involves a open book approach with a design assist fee in case the proposed solution does not meet expectations

  3. Pull plan the design work so that team members focus on the right work in a the right sequence so that no time and effort is wasted pursuing solutions that the project cannot afford

  4. Deliver the design in small batches, working in constant collaboration (Not in Silos) to deliver minimalist design information Just-In-Time to establish feasibility.

  5. Plan design work to enable an early construction start.

  6. Get commitment from the team for regular focused work sessions

  7. Continually test the design to the target cost and make changes often to establish a viable project

  8. Integrate the design to tunnel through cost barriers. Higher performance at less cost is feasible!

  9. Optimize the design to eliminate unnecessary complexity and gold plating

  10. Consider construction processes that lower labour cost. Implement quality control and commissioning to minimize waste and rework costs

  11. Simplify designs to reduce specialty materials and trades. Consider ways to reduce project overhead costs during the design process

The NIRVANA is ability to deliver projects at 19% less cost. [1] Connect with Shift2Lean for a workshop on how to Optimize Value with Target Value Design or to Cross the Finish Line Early with the Last Planner System.

Murray Guy, @Lean_tobe_Green, Connect on LinkedIn … Email

Integrated Designs, EcoSmart Developments & Shift2Lean

[1] Target Value Design: Current Benchmark, Glenn Ballard

#TargetValueDelivery #LeanConstruction #LeanDesign #IntegratedProjectDelivery #Leanprojectdelivery

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