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Presented by Abdulaziz S. Al-Yousefi, CVS –Life, FSAVE

The Synergy between V alue E ngineering & S ustainable C onstruction. Presented by Abdulaziz S. Al-Yousefi, CVS –Life, FSAVE. Dubia , Jan 2016. Value studies are mandatory in ….

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Presented by Abdulaziz S. Al-Yousefi, CVS –Life, FSAVE

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  1. The Synergy between Value Engineering & Sustainable Construction Presented by Abdulaziz S. Al-Yousefi, CVS –Life, FSAVE Dubia , Jan 2016

  2. Value studies are mandatory in … • All US federal projects > $ 2 M • All Japan projects > $ 2 M • All Saudi Government Project > $ 5 M • All RC of J&Y projects > $ 5 M • All Saudi Aramco projects > $ 10 • also in UK, Germany, Francs, Australia, Korea, India, Malaysia, ..etc. Why is that ?!!

  3. VE Accomplishments in the Gulf Area VE Studies done since the start of VE in the GCC in 1978 • More than 10,000 VE Studies • More than 150,000 participants • Done at the rate of 300 /year • Improved the Quality of our projects • Saved More than $ 50 billion • Saving ranged from 5-30% • Rate of return is 1 : 100

  4. This 20-minut presentation is about What rather than How What is it? Finally Conclusion & Recommendations Why we do it? What makes it different? VE Benefits for SC Recorded results

  5. The Synergy between VE & SC Definitions

  6. Definitions Sustainable Development (SD) : “ Development that meets the needs of the present without compromising the ability of the future generations to meet their own needs “ WECD, 1987 Sustainable Construction (SC) : “ The creation and responsible management of health built environment based on resources efficient and ecological principles “ Hill & Brown, 1997

  7. VE is a task oriented STUDY … and can be defined An organized team effort aimed at analyzing Functions and Quality of projects (goods, services and processes) in order to generate practical cost-effective alternatives that meet customer requirements., Al-Yousefi, 1996

  8. The Synergy between VE & SC Value Engineering (VE) Concept

  9. VE, TQM BPR , 6sigma, Kaizen, BSC, QFD MBO CPI SPC JIT QLF RE ZQC ZD VRP LCC AHP TPM Total Value Management … TVM !!! Quality ? Every now and then we have a new buzz word

  10. Value Engineering What is VALUE Benefits & Usefulness

  11. The VE main discussion issues Function Value Quality Cost

  12. Let’s first define …. What isFunction … Needs The reason for its existence Answering … What does it do? Normally … it is fixed … it is either does it or does not do it

  13. Quantity is what you count Quality is what you count on What is Quality? Conformance to Requirements Fit For Use Value-Added benefits It is variable .. It is different from one person to another

  14. Quantity is what you count Quality is what you count on Quality Conformance to Requirements Requirements could be needs or desires Fit For Use or Fit for purpose Cone Cup Does Quality mean ….. Tough, Durable, Strong, last long…. Etc. …. not necessary …

  15. VE Workshop Pre-Study Post-Study Information Function Analysis Idea Generation Evaluation Development Presentation Coordination Data Preparation Team Selection Modeling VE Study Report Implementation Plan Follow-Up 3 – 5 days 1- - 3 days 1 – 4 week The Stages of the VM Study

  16. No Creativity Yes Implementation Follow up Information Function Analysis Evaluation Value Circle Decision Development Presentation The 7 Phases of The VE Workshop What Why How All What How When Who

  17. When do we do it ? TVM Total Value Management A VM-TQM Integration

  18. DR VE2 VEP Saving Acceptance level Implementation When to apply VE ? Goals, Objectives, Requirements Design Criteria, Scope of work Detailed VE Alternatives to the design, Define Systems Conformity to Code, standards, specs Make sure that VEP of VE 2 are implemented 100 10 1 Cost & Effort Construction Documents Planning & Analysis Schematic Design Design Development Working Drawings Construction Operation & Maintenance Project Life Cycle

  19. TVM Why we do it !

  20. Top Circle of SM influence SM Mangers Technical, workers In any organization, Who are the Decision Makers ? Who are the most influencers ?

  21. According to a survey(In Saudi Arabia, Dubai & USA 1996) القيادة الإدارة العليا الإدارة الوسطى التنفيذيين Actual What they Say ... Where do senior managers invest their time … 1- Marketing 2- Human Resources 3- Projects 4- Finance 5- Quality Common Sense is not always Common Practice

  22. TVM According to a survey (In Saudi Arabia, 1991) When asked … after the completion of the facility:- Q.Are you satisfied with what you’ve got ? A. 13 % 61 % 26 %

  23. TVM According to KSU Research , 1999 When asked … after the completion of the facility:- Q.Are you satisfied with what you’ve got ? A. 4 21 % 75 %

  24. Codes, Regulation, standardizations, specification • Saudi annual loss of not having standards according to KFUPM research: • Doors & Windows > one Billion SR • Electrical Plugs > 600 Million SR • That is 1.6 B out of 5-7% of the total initial cost of the project

  25. Life Cycle Costing Level of Influence on Cost Who influence the total cost !

  26. Reasons for unnecessary Costs (Poor Value) • Shortage of time • Misleading information • Ambiguous goals, objectives, scope etc. • Hasty decisions based on false assumption • Lack of ideas • Lack of funds • Resistance to Change • Unrealistic temporary circumstances • Politics • Bad habits and attitudes, beliefs • Over design & Unrealistic safety factors • Continues changing in the owner requirements • Lack of communication coordination • Using unsuitable standards & specification • No LCC estimate …… and more…. How many projects do you know that have some of these?

  27. Value Engineering What makes it different? It has many Tools & Techniques that Quantify Quality & Measure Value

  28. VE Objective .. WE Study and Evaluate the Three Main Financial Operation Technical

  29. TVM clearly define Most projects do not have clearly defined or measurable Goals and Objectives

  30. If You can not Measure it You can not Improve it Function + Quality F + Q Value= = Cost C The Value Index

  31. Value Function Quality Cost The Value Equation

  32. Q V= C F The Value Equation

  33. Efficiency vs. Effectiveness Efficient Do things right In order to implement any VEP, it has to be both Effective Quality Quality V = Do the right thing Cost Cost Function Function

  34. Let’s first define …. Can we …. Quantify the Quality Can we measure the Quality ? Can we measure beauty? The answer is not only yes …. But actually we should

  35. QBS, Structural System Quantifying Quality • A. Insulation • B. Schedule • C.Durability • D.Flexibility • E.Maintenance A A/1 B A/2 B/2 C A/2 B/2 D/1 D A/2 B/1 C/E D/E E = Q / C 7 6 1 2 2 41 29 6 12 12 4 4 5 2 5 164 116 30 24 60 49 394 8.04 5 1 4 4 4 205 29 24 48 48 354 7.87 45 5 3 3 2 4 205 87 18 24 48 382 4.72 81

  36. QBS, Laptop Computer Quantifying Quality • A. Speed • B. HD Capacity • C.Cash Memory • D.Wireless, LAN • E.Warranty A A/1 B A/1 C/1 C A/D B/D C/D D A/1 E/1 C/E D/E E = Q / C 4 2 3 4 3 25 12 19 25 19 5 5 5 4 5 125 60 95 100 95 7.79 475 61 5 5 5 5 4 125 60 95 125 75 480 96 4.99 5 5 5 4 5 125 60 95 100 95 475 53 8.99

  37. Balance Quality Profile Maximum Minimum Quality Model ( Star Diagram for a Housing Project) Environmental Impact Setting the priorities Operation Effectiveness Engineering Performance User Comfort Safety & Security 10 5 0 5 10 Schedule Image ( Site & Facility) Flexibility

  38. Coordination 10 9 8 7 6 5 4 3 2 1 Aesthetics Hygiene Resource Optimization Schedule Safety & Security SOW Accuracy Ease of Implementation Work Efficiency Work Methodology

  39. Study Area Selection Matrix 1 2 3 4 5 6 7 8 9 10 High 10 9 8 7 6 5 4 3 2 1 Importance Low Low High Satisfaction

  40. High Low Low High 1 2 3 4 5 6 7 8 9 10 10 9 8 7 6 5 4 3 2 1 j C A B Importance I G F E A D Satisfaction

  41. Quality Model ( Jubail Housing - Jalmudah Project) Housing unit Layout Wanted Situation 10 9 8 7 6 5 4 3 2 1 Building codes & Regulation Building Material Current Situation Modification to Housing unit by tenants Speed of Construction 1 2 3 4 5 6 7 8 9 10 Ease of O&M Social Issues Quality Issues

  42. Fuel & Feedstock pipeline for Jubail 2, Stage 1 A - Design Approach 10 9 8 7 6 5 4 3 2 1 H – Future Expansion B – Pipe Route Quality Profile C – Pipe Length, Material/Specs G – Staging of Construction 1 2 3 4 5 6 7 8 9 10 D – Valves, fittings, flanges ..etc F – Hydraulic analysis E – Scraping Facilities

  43. TVM Customize Quality Improve Value Optimize Cost 5 – 10% saving

  44. Life Cycle Costing VE Examines LCC Life Cycle Cost Total Cost

  45. Pareto’s Law the 80/20rule 80% of the cost of any project comes from 20% of its components 80% 20% Components Cost

  46. Pareto’s Law the 80/20rule 100 80 20% of the items Makes up 80% of the cost % of Total Cost 60 40 20 0 20 40 60 80 100 % of Items

  47. Pareto’s Law the 80/20 rule Office building Finishes Structural Mechanical Electrical Doors & Windows Auditorium Elevators Site development & Landscaping Insulation Equipments Metal Work

  48. What we normally see Running Cost Hidden costs The 3 kinds of costs of LCC Where are the hidden Costs Initial Single Cost Annual Cost We use the Present Worth Analysis Running , Follow on or Ownership cost Are all the associated cost of running the facility. It covers energy, maintenance, repair replacement, staffing.. etc.

  49. The Client Where are the “ Hidden Costs “ ? Site Cost Capital cost Fees Furnishing Occupancy Cost Energy Cost Maintenance Cost Operating Cost

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