Target Value Design and Lean Structure in Construction

Target Value Design in Construction and Lean Working Structure
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Target Value Design in Construction
Introduction
Target value design enables constructors to come up with a design that meets customer values and delivers the expectations of a project (Ballard, 2008). In short, target value design involves setting the cost and ensuring that the project design is in line with the cost. It is an old idea, but it was not until recently that people in construction started considering it as a fundamental aspect of project management. Target value design originated from the 1930s when manufacturers used it as a method to reduce their production costs so that their final products would correspond with market prices. It blends well with integrated project performance and lean construction practices (Snyde, 2015).
One of the common problems that contractors come across is the project design surpassing the owner’s available budget. Usually, it is difficult to convince them to spend more, and the most reasonable option is to ask them to design down to the available cost (Parsons, 2012). However, some engineering decisions are not easy to make. It is hard coming up with a successful project that pleases all stakeholders. Lean construction and integrated projected delivery have attempted to reduce budget-driven differences. However, there still are gaps that exist between what owners want and what they can afford.
Target value design aims at solving the gap by ensuring that clients get value for their money.

Rather than designing at the start and determining the cost later, the practice pegs the estimated cost in the beginning (Parsons, 2012). The first step is to define the features and roles of the facility as per the client requirements. Second is to assess the cost that the client will pay for the specifications. The cost and value are both elements of the client’s business plan. Comparison of the two takes place before the design process begins, hence giving the production team a chance to analyze the feasibility of the project beforehand. If the cost that the client offers is far below the market value, he has to reconsider the features he wants to be included (Snyde, 2015). That way, the production team avoids redesigning problems that most projects typically have to handle.
Target value design is simply more than a process (Martin, 2015). It is a culture that enables team members to deliver a project within their pre-determined goals. The team defines goals at the onset of the project and reinforces them continuously throughout the project. The team’s goals and the culture they adopt in executing the project are contingents on the goals of the owner, which he lays down at the beginning of the contract. The main goals include design elements, working with the budget cost, achieving the certain quality level and adhering to the schedule (Martin, 2015). However, each owner has his or her unique priorities.
Setting the target cost is the next fundamental step in delivering a project. The cardinal rule of the process is that the operations must never exceed the target cost (Umstot, 2014). The team can accomplish target cost estimation in various ways. One way is to take up the specific dollar amount that the owner attaches to the project. Another approach is that the team comes up with an estimation of the project value based on the current or historical market prices (Martin, 2015). They can also use historical costs then adjust them slightly to match with the current market conditions. Despite the method used to determine the cost, the team must ensure that the operations do not exceed that target.
The next task is designing the project to the target. Most engineers and designers have little information on how to value construction costs. In target driven design, the entire team cooperates in coming up with the most suitable design that will enable them meet the customer value in the best way possible. This stage presents a unique and important opportunity whereby all the project participants listen to each other’s perspectives and learn from each other. The presence of sub-contractors in the team is essential, as they leave the team equipped with techniques on how to report costs as well as other innovative approaches to the technical aspects of the project. Involving sub-contractors is also likely to lead to cost savings, as they are aware of many practical solutions.
Designing of the project occurs simultaneously with estimating and identifying the value of the project (Martin, 2015). Approaching design this way is different from traditional approaches, whereby the design comes before cost estimation. It prevents the team from having to redesign in later stages of the project. Involving a sub-contractor in the cost analysis stage is also valuable, as they help with real-time cost analysis. A collaborative design process needs timely communication of information among participants. Rapid feedback enables them to make any changes they may need to make during the process. Cooperation and engagement of experts in the process are critical in achieving accurate pricing and aligning the costs with design items.
Leveraging technology is also a valuable aspect of the target value design process. The team should always have quantity analysis in mind while constructing the project model. The project estimator together with the modeling team must come up with expectations of the model at various levels of design (Martin, 2015). The team should also use components of the model to perform analysis at various stages of the project. The estimator in collaboration with the modeling team should work towards developing the model to maturity so that it can be productive and accurate in performing quantity analysis for the project.
A target value design environment should have regular design cost analysis. They can be on a weekly or fortnightly basis though the interval can change depending on the project. Detailed reports are essential since they give an indication in case the design falls out of sync with the cost (Martin, 2015). The target value process should be flexible to allow the team members to compare and choose between various designs alternatives.
Finally, target value design advocates for the equal responsibility of all team players to the goals. The process relies on the cooperation of all members and for its success (Martin, 2015). Therefore, everyone should have a sense of commitment to the objectives of the project. Having a team culture enhances efficiency and continuous learning.
Target value design is a project management practice that enables constructors to pursue the project goals while giving owners value for the cost. It involves a systematic approach to executing a project. Unlike traditional approaches, in target value design the team estimates cost at the beginning of the project just before design. It prevents the owner from having to come up with another design later in the project. To be successful, target value design calls for cooperation among the team members.
Lean Work Structuring for Efficient Project Management
Introduction
Lean work structuring is a technique that many project organizations have adopted as a strategy to organize their processes in the most efficient way. It involves the integration of product and process design while developing a project. The structure of work in a project organization is dependent on various levels. Different levels in the production process define the breaks between tasks, the design of each production stage and where it will take place and how to combine the intermediate products to come up with a complete project (Tsao, Tommelein, Swanlund & Howell, 2004). Such kind of an organization helps project managers meet the ideal production goal, which is to come up with products of high quality while minimizing waste and achieving perfection (Ballard & Howell, 2006).
In lean construction, work structuring refers to the practice of aligning process design with product design and all production processes with an aim of making projects more efficient and doing a quality delivery to customers. At the onset of the project, work structuring lays down the design for the entire system. With the advancement in the progress of the project, it focuses more on directing the process design and ensuring that all the interactive processes are running well (Tsao et.al, 2004). Work structuring does not remain constant throughout the project. It is a dynamic process, which project managers should often review the course of the project and make changes where necessary.
Work structuring mainly applies in temporary assembly factories and the designing project processes (The Lean Construction Institute, 1999). Engineering projects act as temporary factories, with the main tasks of assembly and testing. They derive their input materials from supply chains that already exist. To structure a project, understanding how work flows through the supply chains are critical. For some production materials, the factory maintains them in stock since they have standard characteristics. For some materials, they have to order when their need arises since they have to be custom-made. Understanding the networks that supply custom-made items is an essential task of work structuring. This will prevent delays in the project.
While implementing iterative processes, it is advisable for the management team to assign tasks to their respective teams of specialists before undertaking the project. Work structuring is iterative in nature (The Lean Construction Institute, 1999). Therefore, the management should jointly allocate work-structuring tasks to the entire production team. Constituent tasks include design, installation, and supply of components. Failure to have such kind of organization will result in confusion deficiencies in the system. However, this does not imply that they must complete all the work-structuring decisions before they can proceed with the actual processes. Once the management is confident that the established processes are technically fit enough to blend with all the processes, it can commence the work. Later on, those directly involved can design the internal structure well. Four basic roles that the Lean Construction Institute (1999) has recommended for the process include the client, planner, design personnel, specialty contractor and the supplier.
A production system comprises of some processes, which integrate various operations. Operations are activities that use the given resources on certain constraints to come up with desired products. These products must be in line with the general objectives of the project. Between one process and another is a buffer, which stores production resources in the form of materials and information.
Project managers should ensure that both the work structure and product design meet the needs of their clients. Work structuring is a complex technique that relies on certain principles, which the managers must instill at all levels of the project. One of them is minimizing and managing variability. There should be consistency throughout the system. The team should carry out the same operations in a similar way through to set and uphold high quality and consistent standards. Another principle could be cultivating a team spirit. In any mission, group work is an asset to the organization. It may not be easy to accomplish but once it is in place, it leads to efficiency in processes and achievement of results in a timely fashion and fewer costs. The manager should delegate duties collectively to the teams. Another suitable objective in work structuring would be to produce custom products within the least time possible. To achieve such precision, all the participants must be aware of the shifting consumer needs and should stay dedicated to quality production.
Work structuring comprises of five main conventional stages. These are chunking, sequencing, releasing, decoupling and scheduling in that order. Chunking is a strategy that involves reducing the cognitive load by decomposing the large process into units and distributing them amongst teams in the most suitable way. The approach applies to both the product and the processes involved. The planners break down the desired product into various components, each with specific characteristics and functionality. The typical processes of design, supply and assembly will further have phases within them.
For instance, the designing task may include other phases. The first would be coming up with the designing criteria that the personnel will use for both the product and process. The second phase is coming up with a conceptual framework for the following phases: coming up with the design formula for both product and production process, a conceptual framework for the product. The actual design of the product will follow. It comprises of a fully developed idea with details and considers all needs of consumers. The final phase is designing the process that they will use to come up with the product.
The second stage in work structuring is sequencing. The stage determines the order in which the production teams will execute the chunks at various levels. The main concept is to work from the end to the starting point while trying to analyze the whole system and reorganizing it. While working backward, the planners will eliminate irrelevant and time-consuming activities and organize the workflow in a manner that best supports the project. All processes should flow smoothly, and none should prevent the subsequent process from taking place.
At the scheduling stage, work structuring comes up with various components, which include work elements at various levels, process flow diagrams, execution plans, master milestone and the initial look ahead schedules (The Lean Construction Institute, 1999). An execution plan is essential as it gives a guideline of the most important parts of the project. It may specify on the system technologies that the teams will use for various processes. On the other hand, process flow diagrams break down the project stages into a visual display, which allows them to examine the order of chunks and change the design where necessary. The teams responsible for the particular process should draw the diagram by themselves. They will need to decide on how to sub-divide their tasks into sections and decide on the strategies to adopt for each assignment.
The third stage is releasing. There are pre-existing criteria that determine the conditions under which the workflows between processes. Chunks of work can only proceed between production units if the meet certain conditions. The teams may choose to include such rules in the flow diagrams. The fundamental idea for release procedures is to release a component only if it meets the desired criteria (The Lean Construction Institute, 1999). One of the most vital elements of criteria is meeting quality goals. Substandard items cannot proceed to the next stage unless the team responsible rectifies the faults.
The fourth stage is decoupling. It becomes necessary to decouple buffers once it becomes difficult to coordinate the system processes well. Such situations may occur when there are inconsistencies in the rates or processing or delivery. It can also occur if there are variations in the way the teams dispatches work from one production unit to the other (The Lean Construction Institute, 1999). A suitable way to avoid variations is to reduce uncertainty in the processes, especially at release points. The workers will keep track on the workflows at stages where they expect variability. They should create buffers at the points so that the uncertainties in one stage do not affect the subsequent stage. Second, the entire team should be aware of bottleneck resources. They should make a maximum use of them as they are precious and usually determine the rate of production throughout the system. There should be decoupling buffers before and after such resources. Another way to determine release points is to require an explicit production of outputs in advance to ensure that the group responsible meets the timing (The Lean Construction Institute, 1999). The use of buffers speeds up the production process.
The final stage of work structuring is scheduling. Traditionally, the project managers come up with a schedule early in the project. They then use that schedule to compel participants to conform to the contractual obligations during the performance (The Lean Construction Institute, 1999). In most cases, they do not reveal many details of specific stages of production. Also, the managers do not pair enforcing of what they should do with determining what more the team can accomplish. The result is that the commitments relying on production are unreliable. Work structuring emphasizes the need to identify what work the teams should accomplish, what they can do, what they will do and what they have already done. Therefore, rather than one overriding schedule, there should be three vital schedules. One is the master schedule, which indicates what the groups should accomplish. The second is the Look ahead process, which specifies what they can accomplish. The final one is the weekly work plan, which indicates what they will do during the week (The Lean Construction Institute, 1999).
Lean work structuring is a systematic process that enables project managers to organize production tasks and proceed through the process efficiently. The fundamental technique is to organize the entire system into processes and to allocate them to various teams to execute. The principle of teamwork in work structuring makes it easier to achieve the objectives in a timely end more efficient fashion. Adopting work structuring in engineering projects explicitly will make it easier for practitioners to design and run their projects better.
References
Ballard, G. (2008). Target Value Design. Retrieved from <http://p2sl.berkeley.edu/2009-05-26/Glenn%202008-07-29%20=%20Target%20Value%20Design.pdf>
Ballard, G., & Howell, G. (2006). Introduction to Lean Construction: Work Structuring and Production Tool. Retrieved from <http://faculty.wiu.edu/K-Hall/344/IntroU406.pdf>
Martin, P. (2015). Target Value Design (TVD). Retrieved from <www.constructionworkzone.com/articles/target-value-design-tvd>
Parsons, J. (2012). Target Value Design Makes Lean Construction Work Better. Retrieved from <http://www.southlandind.com/sites/default/files/downloads/ENR_Target_Value_Design_Makes_Lean_Construction_Work_Better.pdf>
Snyde, A. B. (2015). Comparing Target Value Design and Value Engineering. Retrieved from <http://blog.procore.com/blog/comparing-target-value-design-and-value-engineering>
The Lean Construction Institute. (1999). Work Structuring. Retrieved from <http://www.leanconstruction.org/media/library/id48/Work_Structuring.pdf>
Tsao, C. Y., Tommelein, I. D., Swanlund, E. S., & Howell, G.A. (2004). Work Structuring to Achieve Integrated Product-Process Design. Journal of Construction Engineering and Management, 130(6). 780-7
Umstot, D. (2014). Target Value Design. How can it benefit you? Retrieved from <http://9293995b8dbc90e36a83-6ce1483d732bd2ccb4d6803b7dc105ce.r78.cf2.rackcdn.com/uploaded/g/0e3687447_1411834508_gasfa-target-value-design-presentation-8sep2014-final.pdf