John Huish is director of campus design and construction at the University of Utah, Salt Lake City, Utah. Pete van der Have is director of plant operations at the University of Utah; he currently serves as APPA's President.
Recently, Facilities Manager magazine had an opportunity to visit the University of Utah. We took this opportunity to talk John Huish, director of campus design and construction, and Pete van der Have, director of plant operations, both at the "U." The focus of the dialogue was on value management. What follows is a representation of the discussion.
FM: What does the term "value management" mean to you?
PV: To me, it represents an involved, an intense process where a group of professionals, of diverse disciplines, work together to design a better facility for a given budget. As a goal to be achieved, the initials VM stand for "value management." We don't just go through the process to meet a budget, although sometimes it might be, nor is it purely to improve on the proposed design. To me, and I believe to most of our physical plant staff, it represents a clear opportunity to make a measurable contribution to the design and function of a building over which we'll have responsibility for 50 years after the designers and the contractors leave.
On "our side of the fence," we first started participating in these sessions about nine years ago. Rumor had it they did occur prior to that time they just didn't invite "those maintenance guys." In other words, we did not get to play back then. Now, we are a full and equal partner in the discussions and the decision making process.
JH: I'm a licensed architect, and some of the traditional meanings of VM (or VE for "value engineering," as it was once called) for an architect are negative. Now that I represent a large institutional user group, my own concepts of VM have transcended these traditional ideas about it. Now VM means several things to me. A few key words immediately come to mind:
Prior to regularly scheduled value management sessions, our department was charged with scheduling plan reviews on our major capital projects, as was our "parent" agency at the state level, the Division of Facilities Construction and Management, who likewise undertook lengthy reviews of contract documents. (Yes, we are one of the few universities in the country to be "blessed" with a state facilities agency providing oversight on our large projects.) VM replaces the formal plan reviews, which seemed to take forever. We had to insist that each reviewer keep a list of comments that described the notations made on the review sets. A project manager then had to retrieve these lists and combine them into a lengthy list to go over with the architect. Items with which the architect disagreed had to be taken back to the reviewer for discussion, and so on. You can imagine how involved and time consuming this process was. It took so long that much of the review comments were dropped, obviating their purpose. Criticism continued to flow back to us that review comments were ignored, that the consultant was still free to specify whatever, etc. All this time the wall between Plant Operations and CD&C grew. The process was feeding an already maligned network.
The decision meeting part of a VM session has now replaced the old, cumbersome review process. Now rather than criticize, we reach consensus through a healthy critique of a project, whereby we assert our individual proj-ect requirements. And we do this with the VM process. It's a great vehicle.
FM: From your perspective, what are the benefits of value management?
PV: From the physical plant professional's perspective, there are numerous benefits. Most obvious is the increased likelihood of acquiring a building that will be reasonably maintainable. Although we may not always get everything we want, anytime one of our recommendations is incorporated into the design, we're a little bit better off than we would have been otherwise.
Another benefit is that we know well ahead of time what kind of facility we're getting. We even know it quite intimately before the first shovel of dirt is moved. It then becomes easier to prepare for it so that it doesn't become an "additional burden." We know how and when to integrate the new facility into existing processes! Learning to know the design team working on a project also presents a benefit. Relationships are developed which result in more trust, better cohesion among all the players, and therefore provide opportunity for a more productive exchange of ideas. As facilities professionals, all of us are continually apprised of what works at our institution, and what doesn't. As a result, our published design standards, (available to designers on-line or by disk) are constantly refined. In a sense we are all training each other!
From the maintenance side, we readily admit that much has been gained from participating in the VM process. It has taught us to appreciate the "big picture." We have learned to appreciate the dilemma of the design team. This group of individuals has to jockey back and forth between the primary occupants, the state as the official owner, Plant Operations as the primary operator, and the university's Campus Design & Construction department as our representative during the entire design/construction process. In other words, they often find themselves in a precarious position, doing a constant balancing act.
In these days of shrinking federal and local support, we are increasingly dependent on private donors to fund new construction. These donors feel reassured by this process just to know they are socking their dollars in a sound investment.
JH: What VM means to me is benefit, as in value added. Pete pretty well described that value in his answer. Reduced cost, however, is certainly not the only benefit to VM. VM was initially established as a measure of surety of costs to a client, but the synergism inherent in the process has brought forth many benefits for an owner or facilities manager.
FM: Are there any negative aspects to the value management process?
PV: A few of us might say that throwing this many people into a meeting of such length is a waste of time. And during the slower, more tedious times when it appears as if nothing positive is happening, it is sort of like watching baseball. At other times, everyone seems to be "a-movin' and a-shakin'," full of anticipation for the home run. A few consider this process a partial or total failure if not all of their suggestions were accepted, even if some were. To those people, spending numerous hours jawboning about issues that only partially support their priorities may seem useless.
Also, at times, talk around the table may become briefly heated and adversarial. Let's face it, professional engineers, architects, facilities people, etc., are not always eager to shift positions or change opinions. But frequently, even those uncomfortable exchanges often result in something good for the project. This process does not come cheaply. Some say that money is better spent on better components during construction, instead of buying a bunch of overpaid individuals a free lunch. To that, I say "bunk."
JH: Boy, I could really get into some credibility trouble here by throwing around a bunch of buzz words like "paradigm." But those whom you've described, Pete the negative folks are still stuck in their own paradigms about construction. They come to a conference like this with all that garbage stacked on top of them and get nothing from the session other than a commitment to themselves that, as soon as they get back to the office, they're going to burn off the mother of all memos to their administration about the time they've all just wasted. Yes, this is new territory to some. As a matter of fact, it should be new to every one of us at every new VM session we attend. We should come with all that "bunk" left back in the correct depository and say to ourselves, "new-building, new ideas, new critique, new assertions; let's go for it and open our minds up to creative, value-centered, cooperative thoughts and ideas." No, we're not going to throw out our standards. But we're not going to wield them either at the sacrifice of real value.
FM: What kinds of projects are best suited for value management?
PV: You could easily and convincingly argue that the bigger the project, the better the potential for payback. Yet, we hold a modified version of VM for most of our smaller construction and remodeling projects, and even for our significant maintenance projects. We benefit from doing all of them.
JH: Again, a sort of "tailoring" results from this process. To predetermine based on project size is missing the point. We have undertaken some great value management on building programs before the onset of design. Especially programs that, because of funding cycles in the legislature, are delayed in processing. Those "aged" programs, which are on the shelf awaiting funding, are absolute candidates for value management because of their needs for reassessment of function, maintenance, and, not the least, budget.
FM: What are some of the specific results which evolved out of the VM process? Are they mandatory?
PV: There are too many positive results from all the sessions we've held thus far on large projects. We simply could not even begin to list them all. At any one session we may end up reviewing a hundred or more recommendations. Perhaps it would be useful to recognize some of the ones that seem to recur most frequently. They address areas such as truss systems, steel vs. concrete decks, size and location of shear walls, roofing systems, chiller sizes, redundancy in, or lack thereof, mechanical systems, cooling towers, building skin, energy efficient/deficient items, fire code compliance, building orientation, service access, location of manholes, utility interface, type of lighting, method of purchase for carpeting, landscaping, constructability, and maintainability, just to name a few. Results or recommendations are not necessarily mandatory. The design team has the theoretical right to accept, modify, further study, or reject suggestions. Realistically, the people paying the bill can insist on implementation of any idea, even over the designers' protestations. So far, however, this has only rarely ended up controversial or adversarial.
JH: We recently canceled a scheduled VM for the schematic design of a $20 million research building. The two-and-a-half-day session was to begin on a Tuesday morning. On the Friday afternoon before, the architect delivered the plans and outline specs with an estimate that was $1.1 million over the budget. We sent it back, canceled the VM, and told him to bring it back on budget and then we'd have the VM session. We weren't going to waste several days trying to take money out of the project to get it on budget. That's the architect's job, not the task of VM participants.
FM: Who pays for the VM? What are the costs?
PV: On large projects, the project budget has to cover the cost of value management. Direct expense items include the cost for bringing in and housing a professional facilitator, rental of a meeting room, fees for the "cold team" (architects and engineers brought in only to critique the design), and then throw in miscellaneous supplies. We also consider the cost of wages for the in-house people who participate in the process. Even though the project does not directly pay for those costs, they still represent an expense to the institution. We tend to look at that kind of expense as a smart investment in our future.
JH: I'm reserving funds in some of my accounts, which are allied to the same purpose, for use in some of the shorter VM sessions we end up having. It's just too critical to not have some reserves at the institution, even the facilities groups for this purpose. But to directly answer the question, the owner pays for VM. That sounds scary, doesn't it? I defer however to the old title block sheets that the Corps of Engineers would give the architectural firm for their work (if you were ever lucky enough to get one of their jobs). In one-inch-high black letters at the top of each sheet outside the ink border was the statement:
"VALUE ENGINEERING DOESN'T COST IT PAYS!"
FM: Describe the VM process. When does it typically occur and how long does it take?
PV: I can recognize seven phases to the whole process. Giving them labels would cause them to fall out something like this:
Let me elaborate on these phases. Introduction allows the facilitator to explain the process, to highlight the objectives, and perhaps to identify key opportunities that he or she has already identified in an initial review of the plans.
Discovery allows the design team to present their project. Presentations are made by the individual disciplines such as architectural, civil, structural, mechanical, and electrical.
Exploration encourages all the participants to examine in detail the plans, budgets, specifications, etc. Brainstorming is where new or not-so-new, radical, and other ideas are identified and listed. People who consider themselves specialists in any discipline gather at that discipline's work table and offer ideas. This is where ideas go through their first cleansing. Trust me, there is nothing more honest than a peer review by a bunch of people who don't have a vested interest!
Evaluation this is the work done down in the trenches! Once the ideas that survived the initial cleansing have been summarized, they are analyzed for cost impact. Will their implementation cost the project more, less, or are they neutral? Comments are provided, for the record, evaluating the pluses and the minuses of their implementation. This process is completed through joint efforts by key team members, including engineers, architects, professional cost estimators, and O&M professionals.
Presentation places the design team back in the midst of the session, and they for the first time become acquainted with the hundred or so ideas prepared by the VMers. Not much discussion takes place at this stage, except to present the ideas and perhaps provide some clarifications. It certainly can be interesting the watch the body language of the design team as they are introduced to some of the ideas!
Decision making happens two days later. The design team has had a chance to review and evaluate the many recommendations. Under the guidance of the facilitator, they provide their reaction to each of the ideas. If they accept a suggestion, end of discussion. Or they can offer to study it further, or accept it with some modifications, etc. They can choose to reject a suggestion, which may lead to some serious negotiations if the rest of the participants feel strongly in the other direction. And so on. Once a suggestion has been accepted by everyone in attendance, the user/owner has every right to expect implementation without substantive change. And that is usually the case.
Looking back at the VM sessions in which we have participated, we could probably claim a 50-50 ratio between accepts and rejects. To me, this means that a helluva lot of suggestions are now in place that otherwise might not even have seen the light of day! This has to have a positive impact on our way of doing business.
FM: Who do you involve? Who conducts it?
PV: At times, when the nature of the project warrants it, an expert facilitator may be brought in. Other times, an in-house facilitator is designated. This person is usually of a strong engineering or architectural orientation, and he or she makes the whole thing happen. The participants, many in proud possession of professional certifications and the requisite egos, require someone who is a strong leader. An expression regarding how difficult it is to herd cats comes to mind. The working group includes architects and engineers not associated with the project in any other way, and representatives of the owner and the user groups. Representing our university, aside from the user groups, are Plant Operations, Campus Design & Construction, Facilities Planning, and Environmental Health & Safety. It seems that all the stakeholders, both short-term and long-term, are well represented.
JH: Between my time away from industry and my advancing mental state, I can't remember the precise title for the facilitator, but it is something like Certified Value Engineer or CV Manager. The certification is the result of training at specialized institutions for such. But I'd look more for personality than a pile of credentials. Those can be checked out by references. I'd go for the qualifications which you described the ability to keep the session steered in the right direction. That takes a particular talent which includes a sense of humor.
FM: Where do you hold your VM sessions?
PV: We have typically used a large meeting room at an off-campus site. We have also used available sites on the campus, thinking that the closer we are to the campus, the higher degree of participation we might see from some of the folks who can't otherwise be there. Of course, parking is always an issue.
The location of the space might not be as critical as is its layout. It needs to be small enough so that everyone can hear and participate in the general discussions, yet large enough that the individual disciplines can gather around their own work tables. Lots of natural light seems to enhance creative thinking and positive interaction. A light lunch should be served in a separate space. There should not be any distractions, such as extraneous sounds, from adjoining spaces. The walls should be so that you can tape work sheets up, for everyone to see. And let's not forget restrooms and phones. They have to be convenient. A phone made available in the room itself has proven to be a useful amenity. We also find that refreshments, provided at the back of the room, offer an opportunity for informal interaction. The watering hole factor.
FM: Is there a scaled-down version of value management for smaller projects?
PV: Yes, there is. Every Monday and Thursday we have a two-hour block of time permanently set aside for that same kind of process but pertaining to smaller remodeling, upgrade, and significant maintenance projects. Users, architects and engineers, O&M people, and anyone else interested can show up to participate in the discussions and decision-making process. Though obviously done on a much lower key for instance, we don't bring in a professional facilitator the concept of the process is fundamentally the same. The benefits have also definitely been the same. These sessions are held right in our own facility.
JH: I have charged my project managers with the responsibilities of facilitating the Monday and Thursday "Project Review" meetings. They handle introductions, challenges to those assembled, and the architect/designers.
FM: Can a VM provide guarantees of O&M costs that are within my budget?
PV: Yeah, right! Are you kidding? No way! Now, having said that, I would also admit that if you have a handle on what type and level of facility your budget can support, you're more likely to be able to approach that, by keeping the design team and the user group under control a little more. We have found that improved maintainability is a frequent benefit from the VM process. For instance, amount and type of glazing often ends up being tweaked in a VM, since I know our budget resource for window washing, like none, and how often we do it, like almost never. Another example is the orientation of entry doors. Besides being concerned about the type of doors and quality, we are extremely sensitive to their orientation, since that can have a major impact on our ability to deal with snow and ice problems, and resulting slip-and-falls. Does that guarantee O&M costs within budget? No, but it helps!
JH: There you go, talking O&M. I knew we couldn't escape it. Let me talk about what my stakes are in light of this question. Only I'm going to rephrase it for my discipline as an architect. (I'll get down to earth someday, Pete; be patient.) Can a VM guarantee me a building that still has some "aesthetics" or "design" characteristics left? Or is what I get an emasculated assembly of maintenance marvels? Now there is PARADIGM ONE for you. To be able to answer that question you have to determine for yourself (or your institution if you don't have an architecture school attached to it), what good "design" really constitutes. We still have a world full of design professionals who triumph in form over function. "Form follows function" and such ridiculous statements are twentieth century contrivances for personal justifications. I'd prefer to step a little further back to Vitruvius who coined "Firmness, Commodity, and Delight" as the paradigm for good design. You gotta have all three, folks, you just can't get away from them. I can take care of the "firmness" and "delight." Pete, you handle the commodity, okay? Commodity covers a big gamut in my book. In order to have it I'll listen to the guys who have to clean the toilets, you bet. Get them to the next VM, for sure. VM can be a very educational process for all who attend.
FM: Will you realize savings in yearly O&M costs?
PV: I would probably prefer to use the term cost avoidance. As I said in the previous answer, we feel we have been able to control the continental drift between budgets and what we need. The VM process has been one of the tools I'm sure has contributed to our success. Our costs per gross square feet have increased less rapidly that have the CPI, labor rates, etc., while our standards have continually improved. We are confident that better facilities management and creative thoughts are key to this success, and this is what you do in a successful VM. That we have been able to participate in the value engineering process as full and equal partners has definitely been instrumental. This is true even in light of some of the disappointments we might have suffered in individual sessions.
FM: You've defined a lengthy process. Can't we learn from doing this once or twice so that the costs and the time can be saved on future projects?
PV: I don't believe so. There are too many variables involved which can impact the character of any project. Consider the collective psyche of the user group, the condition of the local construction market, current technologies, code requirements, sources of funding, current campus activity in ongoing construction, priorities of the current administration, moods of surrounding neighbors and other stakeholders, current availability and costs of utilities, general economic conditions, etc. Each and every one of these can affect the personality and makeup of a proposed facility's programming, development, design, and construction. Therefore, a VM is totally justified for every project to help ensure the proper priority and emphasis is given to each of those variables.
Yet, as said before, VMs do become progressively easier. There are repeat performances by architects and engineers. They learn to anticipate what they can expect from us. The same is true from our side, as well. The exploration and the decision-making phases become easier, and more time is constructively spent in the brainstorming phase. And the results just keep getting better and better.
JH: I have to confess, I was worse than a skeptic. There's no place in this dynamic world for static processes. I thought "static" when I first became involved in VM years ago, as a private practitioner. Wasn't all my professional training good enough to assure my client that they were getting the best, most beautiful bang for their buck? Why are all these people assembled to pick my work apart? These were some of my feelings then. I would groan when I heard the pronouncement "VE" (now "VM").
But, the VM process "retrained" me very positively! We all have responsibilities to each other in the world community. And helping each other learn how to do our jobs better is one of them. Value management is a great medium for that kind of professional development. But the synergy is what's neat. That kind of professional development doesn't occur at someone else's cost.