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VM and the Management of Value
The existing British and European Standard for VM (BS EN 12973:2000) defines Value Management (VM) as a style of management particularly dedicated to motivate people, develop skills & promote synergies & innovation to maximise overall performance of an organisation. However, value is rarely delivered by one organisation in isolation. In the past disproportionate benefits may have been gained by a specific lead / integrating organisation, rather than benefit sharing across the project or alliancing team. For example, in traditional pre-tender procurement, the client may identify and benefit from potential savings, while a contractor working on a post tender fixed price contract may be focused on realising savings for themselves.
Influential clients and institutions believe that early engagement of specialist supply chain partners through alliancing is critical in delivering value for all parties. Although, little is known about how VM should be effectively structured to align commercial incentives for delivering long term value outcomes ahead of lowest cost.
This assignment asks you to make recommendations on how VM should be advanced to early engage the specialist supply chain. You may like to answer one (or more) of the following questions, or develop your own.
• Who stands to benefit from early specialist supplier engagement in VM/VE and what are the triggers for its use?
• How could specific early value-enhancing relationships occur between the contractor and supply chain, or between the client and its specialist supplier alliance?
• What is the role of a client in facilitating VM/VE and how do they promote opportunities for value through early supplier engagement?
• How do the principles of VM/VE get realised through other means of early engagement (e.g. Technical Queries or Design)?
• What are the policies and learning mechanisms that are needed to support early specialist supplier VM/VE delivery?
• How can a specific approach such as “SMART” or MoV be applied to enhance the early engagement of specialist suppliers?
• How can a commercially aligned value culture be created early to integrate the client, contractor and supplier partners in a high performing alliance?
3000 words

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