The value of “value management”, as Mark Neasbey, Director of the Australian Centre for Value Management, has illustrated in each of his previous posts, is in challenging what we think we know. In “The Power of ‘What if?'” he reveals how questioning a ‘given’ led to a radically different solution and a saving of hundreds of millions of dollars. Mark writes:
The types of things that are generally in a list of givens include:
- a law or regulation that has to be complied with;
- a technical performance requirement – be it a range or a set minimum or maximum number or a specific number – which can represent dimensions, volumes, rates and so on;
- a limiting boundary or barrier or a technical constraint;
- financial – e.g. an amount not to be exceeded or specified sources of funding, interest rates and so on;
- ownership and operating arrangements;
- authorities and delegations;
- a specific time or date that the asset is required or to be disposed of; and
- application of a particular process or corporate policy.
[Not an exhaustive but just some main examples.]
Now the thing about such givens is that we develop our options or solutions accepting these, rather than challenging them. So they tend not to come into creative thinking processes, accept as a limitation. Yet what happens if its not really a given, rather it turns out to be possible to change it – even if only to treat it as an assumption?
A recent rail project to develop expanded train maintenance and stabling facilities began with a given that the existing mainline was fixed – it could not be changed. By not allowing it to be moved the project solution involved some complex and expensive engineering and infrastructure to manage the train movements into and out of the depot, which are planned to eventually have headways as short as 30 seconds. [Driverless trains.] There was also an effect on how the layout of the expanded facility could be realised – it was not going to be as ideally efficient as possible to operate.
During a value engineering review however, the effects of not moving the mainline to the engineered solution became clearly a cause – not of concern – but for a better appreciation of the opportunity forgone to create a simpler, more elegant engineered solution and at a huge cost reduction.
The mainline alignment had been stated as a given by the client early in the planning process. So all of the initial feasibility work and preliminary concepts evolved based on that given. What subsequently emerged in the value engineering review was that this arose from a decision not to acquire a particular developed property adjacent to the line.
By asking the simple question “what if…?” the team was able to show a much better outcome was possible – not only at a lower capital cost, but with significant long term reduction in maintenance and operational risks to the network.
Two important highlight lessons to me are:
- Do you have an understanding of what is being labelled or taken as givens for your assets and asset strategies?
- Do you have a process to all testing and challenging of such givens so decision-makers are aware of their implications?
The Task today: An answer to either of Mark’s questions OR an example of a positive ‘What if?” challenge of your own.
I like the concept that is being expressed here. However, my experience has led me to the belief, fortified by experience, that ‘givens’ – in particular, time and finances – are key motivators for project success. They may even have been drivers to get the project underway. So, it seems that we need some guidance about what ‘givens’ to challenge and when to accept a ‘given’ rather than challenge it. I am not suggesting that there are ‘givens’ that should not be challenged but that there needs to be some demonstrable significant benefit to the project from such a challenge rather than chasing down every potential change to project parameters. To give an example, without naming names, in a recent water reuse project that I was associated with the managing director of the major beneficiary of the improved water security from the project simply stated that he had two kpi’s – cost of x, the original number discussed, and completed by a specific date. Those two kpi’s drove an innovative solution that reduced the need for regulatory approvals and increased the yield, as well as having the project completed on time and on budget. Project constraints can be spurs to success as well as road blocks! The trick is to differentiate the spurs from the road blocks.
David, You are right in that constraints often do produce innovative outcomes and I guess if the constraints are resulting in innovative solutions – then leave well enough alone! In Mark’s example, this was not happening, the costs were mounting. Two other things should also be noted: (1) the ‘what if’ challenge only arose after considerable thought and analysis had been put into working within the constraints and no efficient and effective solution had arisen and (2) once applied, the ‘what if’ challenge produced the innovation that saved hundreds of millions of dollars. So perhaps that is the guideline needed, first work within the constraints and if this is not successful try the ‘what if’ solutions by challenging the constraints. If the ‘what if’ challenge does not produce a useful option then it dies a natural death. But if it yields great potential benefits, then you develop it further, promote it – and adopt it.
This is an example of why it’s vital to (with ISO 55000) maintain a clear line of sight to organisational objectives (relevant to the organisation – why we’re here), not just focus on AM objectives (relevant to particular projects, often expressed as ‘givens’).
My example of a positive ‘what if’ challenge happened a few years ago: a developer had a great project with some substantial benefits to the community… but council staff were putting up ‘road blocks’ because of flooding and urban design issues.
Rather than confining thinking to his particular site, I recommended to council that we redevelop the public streetscape (with a contribution from the developer), replacing a 2 lane roundabout with lights (replacing a road pavement in poor condition and improving walkability in the CBD) and opening up the waterway area to reduce flooding AND enable the developer to produce a vastly superior development that has helped revitalise the CBD.
This project wasn’t on council’s radar… but because our organisational objectives were in the back of my mind (I wasn’t just thinking about the issues directly in front of me) it popped into my head immediately upon seeing the problem.
The real challenge for us is to improve the line of sight across the board: this is firstly about improving our organisational plans (in NSW, the community strategic plan) but also improving our alignment between these and the AMPs.