Value Management Report: TechWatt Corporation Building Project

This report presents a comprehensive value management analysis for TechWatt Corporation's new building project. It begins with an executive summary outlining the benefits of value management, including cost reduction and performance improvement. The introduction emphasizes value management's role in enhancing project value from inception to operation, ensuring quality and minimizing lifecycle costs. The report details the information required before a value management workshop, focusing on financial data and risk assessment. It identifies key team members, including project managers, finance teams, and value managers, and their respective roles. The report explores areas for value improvement, such as maximizing profitability and enhancing the working environment. It also discusses tools and techniques like the value indicator technique, which assesses the relationship between project costs and the value realized. The study outlines the benefits of value management for TechWatt Corporation, including improved project understanding and streamlined processes. The report also details the value management study's key components, such as validating planning assumptions, aligning with stakeholder objectives, and analyzing costs versus worth. It emphasizes the importance of considering client characteristics and aligning the project with the company’s goals of effective operations, customer service, and business expansion, ultimately aiming to provide maximum value for the investment. The report concludes with a reference list of relevant sources.

Value Management Report of
TechWatt Corporation Report
Table of Contents
1. Executive Summary
2. Introduction
3. Information required before the workshop
4. People involved
5. Areas for improving value
6. Tools and Techniques
7. Benefits of Value management for TechWatt Corporation
8. What the Value Management Study will entail
9. Reference List
Executive Summary
Value management is a process that is used to discover the different functions
of the project. This includes coming up with techniques and tools which can be
useful in meeting the required objectives. Value management will be used to
successfully manage the construction of TechWatt Corporation’s new building.
This will be beneficial, as it will ensure that the project flows smoothly from the
inception to completion.
In addition, value management will assist in cutting costs while improving
performance. This report will include the benefits of value management to
TechWatt Corporation, the agenda for the study, techniques that would be
useful if applied in the study. In addition, the issues that should be analyzed
during the value management study will be dealt with. The participants of the
program and the role they will play will be discussed.
Introduction
Value management has been widely accepted as a means of enhancing the
value of a project from it inception to its operation. The process ensures that

quality, performance, reliability are upheld while minimising the life cycle costs
(Shen & Liu 2004).
Value management is useful in dealing with challenges like constraints in the
budget and complexity of a project. Value management can assist in reducing
costs while sustaining or improving the performance of a construction project.
TechWatt Corporation will benefit in many ways by using value management
during the projects initial stages. It will be able to add value to the building
project that thus improving its position in the market. The main benefit of value
management is attaining the maximum the maximum value from the entire
project.
This is what sets value management apart from other methods of improving
value for projects or systems. TechWatt Corporation will be able to find the
best ways to optimize design and establish the project objectives by analyzing
the project briefs.
Information required before the workshop
Financial information is very important for decision making during the
deliberations in the workshop. This includes the costs of the project, the
expected benefits. The venture can create value if the benefits are more than
the costs or if there is value for the money invested. Financial data is useful in
his stage because sound decisions can be made based on this information.
(Shen & Liu 2004)
Information about risks that TechWatt Corporation would face should be made
available to the participants of the workshop. Considering risk is necessary in
value management. Important data includes the kind of risks in the market and
ways to manage these risks. In addition, the cost of dealing with risks should
be highlighted. (Shen & Liu 2004)
People involved

Value management is a team activity which involves the interaction and
cooperation of many people. The team TechWatt Corporation may include in
value management study may include the project manager, constructor,
company managers, the project finance team, design team, project cost
manager.
A value manager must be part of the value management team. This individual
is charged with the responsibility of understanding the value problems,
coordinating value systems and implementing improvements to the company.
(Woodhead & Downs 2001)
The finance team has to ensure that the project being embarked on by
TechWatt Corporation has a sound capital investment plan. The team should
also perform a detailed analysis of the project in order to find useful
information that will be used during deliberations and decision-making. The
finance team should ensure that the project follows the company’s financial
policies.
The accounting and financial reporting standards should also be followed. The
managers responsibility is to ensure that there is proper planning. This
includes asset disposal planning, asset maintenance, planning and capital
investments planning. The basis of these plans should be the company’s
policies. (Woodhead & Downs 2001)
Areas for improving value
Constructing the new building to house the headquarters of TechWatt
Corporation should create value for the organization. This may be in terms of
increased profitability, a better working environment or improving the
experience of the firm’s clients.
Value management will assist the organization in creating a means of
balancing costs of a project and the benefits received. Value for money is a
key feature in value management and it focuses on creating value for
investment (Dell’Isola, A.1982).

Tools and Techniques
The value indicator technique is appropriate for this construction project. The
focus of the technique is to ensure that the cost of a project matches the value
that is realized from it. The relationship between cost and function of the
structure to be built by TechWatt Corporation are critical in the value study.
The value index is computed by dividing the dividing the function index by the
cost index.
The function index is a number between zero and one which shows the
degree of importance of the benefits expected. It can be determined by the
value study team using mathematical methods such as the force decision
method. The cost index is the calculated by dividing the cost of a component
of the project divided by the cost of the whole project (Shen & Liu 2004).
Benefits of Value management for
TechWatt Corporation
Employing value management during the initial stages of the building project
will provide the advantage of acquiring greater insight about what the project
is all about. The purpose and means of achieving the same will be known to
various stakeholders. Often middle managers are not knowledgeable of all the
aspects of a project and this will be a good opportunity to gain this insight
(Woodhead & Downs 2001).
Value management will be useful for establishing project objectives, preparing
the project brief and the consideration of concept and design alternatives.
TechWatt Corporation will benefit from value management in many ways. It
will be possible to simplify and ease processes in the project. There will be a
lot of time, money is necessary to carry out the project successfully.
With proper planning and execution, efficiency will be enhanced hence time
and money will be saved. Obsolete and redundant items and procedures can
be known and discarded. For instance old technologies with are no longer
efficient can be done away with (Dell’Isola, A.1982).

What the Value Management Study will
entail
Value management will that TechWatt Corporation will be involved in will
begin with the testing and validation of planning assumptions. The values,
objectives and wants of the various stakeholders have to be informed about
the planned changes and there approval sought.
What is important to stakeholders is what the managers need to embark on.
After the decisions of the stakeholders are known and analyzed, the
information received will assist in creating a lasting common vision and
direction for the entire group. (Graham, Kelly & Male 2001)
It is imperative that the value management team examine the results of the
study to company procurement and policies. In addition, they should ensure
that there is no discrepancy with the law or company this is very important
because it will ensure that there are no loopholes which can lead to lawsuits
and exploitation by others.
Thereafter, the value manager needs to develop some master principles and
goals which are the goals for the entire organization concerning a project. The
challenges and opportunities that may be expected once the project work
begins will be known to the important stakeholders (Dell’Isola, A.1982).
It is important to carry out a function analysis during the value management
study so as to find out the things that need to be done so as to meet the
projects objectives. The management of TechWatt Corporation should carry
out this procedure so as to find areas of wastage, over expenditure and
duplication.
This will provide an opportunity for value to be improved in the building
project. The functional analysis will also enable the participants of the value
management process to test the assumptions and requirements that are in the
brief (Graham, Kelly & Male 2001).

TechWatt Corporation should be focusing on getting value for money
therefore, the value management study will involve an analysis of the cost of
the project verses the worth.
Each group of specialists e.g. the finance team, will have to examine, review
and update the requirements of its own field. This will enhance the
performance of the whole group as each individual contributes knowledge to
his or her field of expertise. (Graham, Kelly & Male 2001).
During the value management study, it is necessary that the clients
characteristics. This will ensure that the process takes into consideration the
requirements of the clients that TechWatt Corporation serves.
The information that is necessary includes demographic data, experience,
financial capabilities etc. this will enable the firm to use appropriate means of
attracting and retaining customers. Value will be added to the process if
customer service is carried out in light of the requirements of the customer.
(Woodhead & Downs 2001)
The agenda for TechWatt Corporation’s value management study is to
enhance its effective operations, customer service and business expansion. In
addition, it is important that the process clearly show how the organization will
get value for the money they invest in the project.
The individuals in the value management team will come up with measures to
improve the business while meeting the customers’ needs. The new project
should to add value to the core business of the organization. (Woodhead &
Downs 2001)
Reference List
Dell’Isola, A.1982, Value Engineering in the Construction Industry, Van
Nostrand Reinhold: New York.

Fong, P., 1999. Organizational knowledge and responses of public sector
clients towards value management. ‘The International Journal of Public Sector
Management.’ Vol. 12, no. 5, pp. 445-454.
Graham, D., Kelly J., & Male, S., 2001. Value management of construction
projects Wiley-Blackwell: Oxford.
Woodhead, M., & Downs C., 2001. Value management: improving
capabilities. Thomas Telford: London.
Lin G., & Shen Q., 2007. Measuring the Performance of Value Management
Studies in Construction: Critical Review. Journal or management in
Engineering, vol. 23, no. pp. 2-9.