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Summary - Value Management
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Value Management summary (2020)Value Management
Module 1: Introduction
What is value management?
Official definition (NEN-EN12973:2020):
▪ an underlying concept applied within existing management systems and approaches,
Can be used alongside other management processes, such as project management.
▪ based on value and function-oriented thinking, behaviour and methods,
▪ particularly dedicated to motivating people, developing skills, and promoting synergies and
innovation,
Not only focused on methods, but also on people, how to apply and use.
▪ with the aim of maximizing the overall performance of the organization
At organizational level (project level > value engineering)
In own words:
“Value management is an approach to maximize the overall performance of an organization, by
improving the value of its products, processes and services.”
Approach= set of methods, principles, enablers, procedures, and processed that describe how things
can be done.
What is value?
𝑠𝑎𝑡𝑖𝑠𝑓𝑎𝑐𝑡𝑖𝑜𝑛 𝑜𝑓 𝑛𝑒𝑒𝑑𝑠
Value (broad definition): 𝑣𝑎𝑙𝑢𝑒 = 𝑐𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 𝑜𝑓 𝑟𝑒𝑠𝑜𝑢𝑟𝑐𝑒𝑠
𝑓𝑢𝑛𝑐𝑡𝑖𝑜𝑛𝑎𝑙 𝑝𝑒𝑟𝑓𝑜𝑟𝑚𝑎𝑛𝑐𝑒
Value (narrow definition): 𝑣𝑎𝑙𝑢𝑒 =
𝑐𝑜𝑠𝑡𝑠
The truss bridge and tunnel
score equally on value, despite
that the tunnel is more
expensive.
From value perspective, the
beam bridge is the best option.
Value Management is an approach to maximize the overall performance of an organisation by
applying value and function concepts.
- Complete framework for an organisation
- Reactive and proactive
Page 1 of 11
, Value Management summary (2020)
Norms and standards can be found in:
- NEN 12973 January 2020 (What is VM?)
- NEN 1325 (terms and definitions)
- Value Methodology Standard U.S.
VM-principles:
• Value orientation
• Focus on function
• Holistic approach
• Managing complexity and uncertainty
VM-drivers:
• Strengthen collaboration
• Motivating positive human dynamics
• Focus on internal and external environment
• Apply proven methods and tools
Applying VM:
• Informal/intuitive
• Formal
• Project-based
Value Analysis: increasing the value of an existing product
- Eliminate unnecessary cost (without reduction of function)
- Reactive
Value Engineering: increasing the value of a new product
- Project/product based
- Pro-active
Job plan of a value engineering
study, type of phases:
- Information
- Function analysis
- Creative
- Evaluation
- Development
- Presentation
Page 2 of 11
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