Quality definitions The degree to which a set of inherent characteristics fulfill requirements (PMBOK, Fourth Edition, 2008) The first absolute of Quality Management is: QUALITY HAS TO BE DEFINED AS CONFORMANCE TO REQUIREMENTS, NOT AS GOODNESS. Philip Crosby Quality in a service or product is not what you put into it. It is what the customer gets out of it. Peter Drucker Quality - Those attributes of a product or service that the customer attaches value to. Depending on the customer's focus, "Quality" may include surface finish, timeliness, size, 59 cost, reliability, or other factors. Joseph R Jablonski
Quality concept has changed Coffee shops do not sell … Just coffee Restaurants do not sell … Just food They actually sell Services Experience Entertainment 60 Relationship
Function Quality Relationship Gate هباوب Boat براق River رهن 61
Function Quality Relationship Function Customer Quality 62
Quantity is what you count Quality is what you count on Quality Conformance to Requirements Requirements could be needs or desires Fit For Use or Fit for purpose Cone Cup Does Quality mean ….. Tough, Durable, Strong, last long…. Etc. 63 …. not necessary …
The Value Equation Function Value Cost Quality 65
Let’s first define …. What is Cost It is the LCC Life Cycle Cost 66
Let’s first define …. What about …. Time & Budget 67
When purchasing an item Function Customer Needs Quality Cost Customer Desires + Customer LCC 68
When purchasing an item Cost Customer LCC Quality Customer Desires + 69
When Evaluating a project Function Customer Needs Quality Resources Offered Available Expected Required 70
The Value Equation Function Value Cost Quality 71
The Value Index If you can not measure it, you can not manage it If Value Value You can not Measure it Cost Cost You can not Quality Function Function Improve it 72
How to measure VALUE ? If you can not measure it you can not improve it you can not manage it 80
The Value Equation VAL ALUE UE Function Quality Cost 82
Value Measure Q V= C F 83
The Value Equation VAL ALUE UE Quality Cost Funct Function ion 84
Quality ? Different names (labels) … one goal VE, TQM, Kiezen, 6 sigma, BSC, KPI, BPR, QFD, MBO, CPI, SPC, JIT, QLF, BPR, ZQC, ZD, VRP, LCC, AHP, TPM Value Engineering integrates with and complements others Why every now and then we have a new buzz word ? 86 70-80% of the world experts in Quality and Management are Engineers
If you can not measure it, The VALUE equation you can not manage (Improve) it Can we …. Quantify the Quality Can we measure Quality ? Can we measure beauty? The answer is not just … yes …. But actually … we should 87
If you can not measure it, The VALUE equation you can not manage (Improve) it How to solve a BIG or complicated problem? Use Quality Based Selections (QBS) Decision Matrix By breaking the BIG problem into several smaller easier problems. 88
Quality Based Selection (QBS) What is QBS? Quality Based Selection 89
Quality Base Selection (QBS) … Decision Matrix (DM) Non-Monetary Criteria How Important A 2 points for Major Preference B 1 points for Minor Preference C 1 point each for Same preference D E = Q / C Q C V رايعملا لقث ةفلكتلا رشؤم ةدوجلا ةيلكلا ةميقلا رايعم لكل ةيوئملا ةبسنلا Points 90 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
Quality Base Selection (QBS) Non-Monetary Criteria How Important A 2 points for Major Preference B 1 points for Minor Preference C 1 point each for Same preference D E = Q / C Q C V رايعملا لقث ةفلكتلا رشؤم ةدوجلا ةيلكلا ةميقلا رايعم لكل ةيوئملا ةبسنلا Points 91 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
Flooring for Training Room Like this course Non-Monetary Criteria How Important A. Safety 2 points for Major Preference A A/2 B B. Hygiene 1 points for Minor Preference C. Ease of O&M A/C C/1 C 1 point each for Same preference D. Aesthetics A/D B/D C/D D E . Sound Absorb = Q / C Q C V E/1 E E/1 E/1 C/E Weight 4 1 4 3 4 Value Quality LCC Index Points Weight Percentage 25 6 25 19 25 Ceramic 4 5 4 3 2 70 70 4.81 81 337 337 100 30 100 57 50 5 3 3 5 5 Carpet 438 438 125 18 75 95 125 80 80 5.48 48 Marble 3 4 4 5 3 92 3.69 69 369 369 100 100 75 24 100 95 75 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
Flooring for Training Room Weighted Evaluation Flooring for Training Hall Project How Important Non-Monetary Criteria A. Safety ناملؤا 2 points for Major Preference A B. Hygiene ةحصلا 1 point for Minor Preference A2 B C. Ease of O&M ةنايصلاو ليغشتلا AC 1 point each for Same preference C1 C D. Aesthetics لامجلا AD BD CD D E. Sound absorption توصلا صاصتما E1 Q C V = Q / C E1 CE E1 E Weight 4 1 4 3 4 Weighted LCC Value Value Index Alternatives % 25 6 25 19 25 Criteria Index Out of 10 Ceramic 4 5 4 3 2 338 70 4.82 8.8 (Rate) X (%) 100 31 100 56 50 Carpet 5 3 3 5 5 438 80 5.47 10.0 125 19 75 94 125 Marble 3 3 4 4 5 369 100 3.69 6.7 75 25 100 94 75 94
QBS, Choosing a Laptop , June 2008 How Important Non-Monetary Criteria 2 A. CPU Speed points for Major Preference A 1 B. HD Capacity point for Minor Preference AB B 1 C. Weight & Size point each for Same preference A1 B1 C D. Cache Memory AD BD D1 D E. Screen Size Q C V = Q / C A1 B1 CE D1 E Weight 4 4 1 4 1 Quality Cost Value Value Index Alternatives % 29 29 7 29 7 Points SR Measure Out of 10 Dell, 13.3 " 5 5 5 5 5 500 8.0 62.50 7.4 XPS M1330 T9500, 1.8 kg 143 143 36 143 36 Toshiba, 13.3 " 4 5 4 4 5 436 5.7 76.44 9.1 U400-100 C2D T8300, 1.9 kg 114 143 29 114 36 HP, 14.1 " 4 5 5 3 5 95 479 5.7 83.96 10.0 DV 2860 C2D T9300, 4.4 kg 143 143 21 143 29
QBS, Quantifying the Quality – Purchasing a car Non-Monetary Criteria How Important A. Safety 2 points for Major Preference A B. Size A/1 B 1 points for Minor Preference 1 point each for Same preference C. Comfort A/2 B/C C D. Spare parts Availability D A/2 D/1 C/D E . Ease of Maintenance = Q / C Q C V D/1 E A/2 E/1 C/E 7 1 3 3 2 Weight Quality LCC Value Index % of the total 44 6 19 19 12 Points SR Q / C Venture – GM 5 4 4 5 5 125 125 475 475 3.80 80 220 24 76 95 60 Honda 5 5 5 3 3 426 426 3.16 16 135 135 220 30 95 57 24 Previa – Japan 96 4 4 4 5 5 431 431 3.75 75 115 115 176 24 76 95 60 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
رايتخا ةجوز ... جوز وأ ( يلع وبأ عورشم ) ةيدام ريغلا ريياعملا How Important A. لامجلا 2 points for Major Preference A B. بسنلاو بسحلا A/1 B 1 points for Minor Preference C. ةيسنجلا A/2 C/1 C 1 point each for Same preference D. ةورثلا D A/B B/1 D/1 E . رمعلا = Q / C Q C V E/1 E A/E E/2 E/2 رايعملا لقث ةفلكتلا رشؤم 5 2 1 1 6 ةدوجلا ةيلكلا ةميقلا رايعم لكل ةيوئملا ةبسنلا Points 30 14 7 7 42 ةريمس ( ةقلطم ) 4 5 4 3 2 6565 4.9 320320 120 70 28 28 82 داعس ( ركب ) 5 3 3 5 4 416416 150 42 21 35 168 100100 4.2 ارون ( ةلمرأ ) 4 4 5 5 3 97 5.2 363363 7070 120 42 35 35 126 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
Choosing a wife Non-monetary Criteria How Important 2 points for Major Preference A. beauty A B. Type -race A/1 B 1 points for Minor Preference C. Nationality A/2 C/1 C 1 point each for Same preference D. Wealth D A/B B/1 D/1 E . Age = Q / C Q C V E/1 E A/E E/2 E/2 W Cost Value 5 2 1 1 6 Quality SR Index Points Percentage 30 14 7 7 42 Sameerah 4 5 4 3 2 65 65 4.9 320 320 120 70 28 28 82 5 3 3 5 4 Suad 416 416 150 42 21 35 168 100 100 4.2 Nora 4 4 5 5 3 98 5.2 363 363 70 70 120 42 35 35 126 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
رايتخا ةيناث ةجوز ... رايسم ... رافسم ... فايصم ... ةسانو ... خلا ةيدام ريغلا ريياعملا How Important A. لامجلا 2 points for Major Preference A B. بسنلاو بسحلا A/1 B 1 points for Minor Preference C. ةيسنجلا A/2 C/1 C 1 point each for Same preference D. ةورثلا D A/B B/1 D/1 E . رمعلا = Q / C Q C V E/1 E A/E E/2 E/2 رايعملا لقث ةفلكتلا رشؤم 5 2 1 1 6 ةدوجلا ةيلكلا ةميقلا رايعم لكل ةيوئملا ةبسنلا Points 30 14 7 7 42 ةريمس ( ةقلطم ) 4 5 4 3 2 6565 4.9 320320 120 70 28 28 82 داعس ( ركب ) 5 3 3 5 4 416416 150 42 21 35 168 100100 4.2 ارون ( ةلمرأ ) 4 4 5 5 3 99 5.2 363363 7070 120 42 35 35 126 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
رايتخا ةجوز ... رايسم ... رافسم ... دنرف جاوز ( يلع وبأ عورشم ) ةيمسرلا ةقيثولا Official Document How to choose a wife 100
QBS, Structural System Non-Monetary Criteria How Important A. Insulation 2 points for Major Preference A B. Schedule A/1 B 1 points for Minor Preference C. Durability 1 point each for Same preference A/2 B/2 C D. Flexibility D A/2 B/2 D/1 E. Maintenance = Q / C Q C V D/E E A/2 B/1 C/E 7 6 1 2 2 Weight Quality LCC Value Index % of the total 41 29 6 12 12 Points SR Q / C Pre-cast 4 4 5 2 5 49 49 394 394 8.04 04 164 116 30 24 60 Double Wall 5 1 4 4 4 354 354 7.87 87 45 45 205 29 24 48 48 Steel Frame 101 5 3 3 2 4 382 382 4.72 72 81 81 205 87 18 24 48 Rates : (5) Excellent, (4) Very Good, (3) Good, (2) Fair, (1) Poor
Your QBS Now do your Quality Based Selection (QBS ) for three options For examples. Choosing …. University. - A training venue - Job. - Vacation place. - 102 others … -
Value Engineering VE Definition (s) 106
Value Engineering applications VE Products Services Product Process s Soft VE Hard VE Project management, Goods Cost Estimation, Projects 107 Specs, Standards …etc
ةميقلا رصانع Value Engineering ةينفلا VE Covers Technical ةيليغشتلا Three main Operational Issues ةيلاملا Financial 108
Value Engineering ( PMBOK – 4 th Edition, 2008) An approach used to optimize project life cycle costs, save time, increase profit, improve quality, expand market, solve problems and use resources more effectively. ةقيرط مدختست لوصولل فيلاكتب ةرود ةايح عورشملا ىلإ دحلا لثمألا ريفوتو تقولا ةدايزو حابرألا نيسحتو ةدوجلا عيسوتو ةصح قوسلا و لح لكاشملا مادختسإو دراوملا ةيلعافب ربكأا . 110
Value Engineering Value Engineering ( Al-Yousefi) An organized team effort aimed at analyzing Functions and Quality of projects (goods, services and processes) in order to generate practical cost- effective alternatives that meet customer requirements. 111
Value Engineering يه ةيميقلا ةسدنهلا : دهج يعامج مظنم ليلحتل ف ئاظولا ةدوجلاو ضرغل جورخلا لئادبب ةيلمع وذ ةفلكت ةبسانم يبلتو تابلطتم تابغرو ديفتسملا 112
Value Engineering Value Engineering ةدوجلا ليصفت Customize Quality Improve Value Not always Improving Quality ةميقلا نيسحت تاقفنلا ديشرت Optimize Cost Not always Reducing Cost 113
Function is the most important, then Quality, then Cost Function Quality Cost 116
Life Cycle Costing VE Exam ines LCC Life Cycle Cost 117 Total Cost
THE ICEBERG HOW MUCH DO YOU SEE OF AN ICEBERG? 118
THE ICEBERG ONLY 10 OF ANY ICEBERG IS VISIBLE. THE REMAINING 90% IS BELOW SEA LEVEL. 119
The 3 kinds of costs of LCC Where are the hidden Costs What we Running Initial normally see Single Hidden costs Cost Cost We use the Present Worth Analysis Running , Follow on or Ownership cost Are all the associated cost of running the facility. It covers 120 energy, maintenance, repair replacement, staffing.. etc.
Where are the “ Hidden Costs “ ? Site Cost Capital cost Fees The Client Furnishing Occupancy Cost Energy Maintenance Cost Cost Operating Cost 121
ةيلكلا ةفلكتلا ؟ ةيئرم ريغلا فيلاكتلا نيأ ديفتسملا ةيوست عقوملا ميمصتل موسر ءاشنلبا حيلصتلاو كلبهلئا تادعملاو ثيثأتلا لادبتسلبا نامضلا ةقاطلا نيزختلا ةنايصلا ليغشتلا ةراسخلا 122
ـل ةيلكلا ةفلكتلا Life Cycle Costing 300 Bed Hospital - Life span is 25 years Even if we save SR 100 M, all we are doing is reducing the 8% to 6% Case 1 : Initial Cost = SR 365 Millions Operation Cost Design Cost 8 % Initial Cost Alteration Cost 124 Maint. Cost
Life Cycle Costing Level of Influence on Cost Who influence the total cost ! Others O & M Construction Designer Owner 125 Specs & Standards
Life Cycle Costing Level of Influence on Cost 100% 5 5 90% 30 80% 20 70% Overhead 15 60% Labor 50% Material 40% Design 70 30% 50 20% 10% 5 0% 126 Actual cost Cost Influence Sources : 6 sigma Academy
Life Cycle Cost ةيلكلا ةفلكتلا Revenues 10.1 For an Economical Life Span of 25 years And Discount rate of 6% Our annual Net is 6.3 Initial cost is 220 M Break even is in Year 90 3.4 127 Annual Expense
Life Cycle Cost ةيلكلا ةفلكتلا Revenues 16 If our revenue is 16 M Annual expenses is 2 M The break even will be in year 40 2 128 Annual Expenses
Life Cycle Costing Recommendation Economic Life Span 1.0 Technical Life 0.9 Discounted Annual Cost 0.8 Real Life 40 years 0.7 0.6 20 years Economical Life 0.5 0.4 0.3 Total ownership 0.2 cost P.W. 0.1 0.0 0 10 20 30 40 50 60 70 80 90 100 Time (Years) 129 Source : LCC For Design Professionals
Value Management Value Management The Stages of VM Study 130
The Stages of the VM Study Pre-Study Coordination Data Preparation Team Selection VE Workshop Modeling Information Function Analysis 1- 3 days Idea Generation Post-Study Evaluation Development VE Study Report Presentation Implementation Plan 3 – 5 days Follow-Up 1 – 4 week 131
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