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					Appendix 11
Opportunities Process:

1. Ideally, the Opportunity Process should start at late RIBA stage C.

2. Obtain a detailed cost breakdown of the project or programme. This cost breakdown should show the anticipated construction costs broken down to labour, plant, material, preliminary, and other items.

3. Create a Pareto (this being the 20% by number which constitutes 80% of the total cost) of major items of cost by arranging the individual items identified in the cost break down into a list with the highest value items at the top and the lowest at the bottom. In essence, this exercise is aimed at clearly identifying the 20% of items by number which will make up 80% of the total cost.

4. Identify individual items of cost within the major Pareto items. This step of the process is aimed at ensuring that each major item within the 80/20 analysis is broken down into the smallest possible constituent element.

5. Understand the key customer requirements from each major individual item. This is a key step within the process and should be carried out as early as possible and in a proactive manner. It may not be possible to define the customer requirements for each element. However, it is important to ascertain the customer priorities in terms of drivers such as:          Initial Purchasing Price Final Built Cost Whole Life Cost Quality Aesthetics Building Performance Speed of Build Certainty of Build Period Sustainability/ Environmental

6. Identify appropriate personnel to be involved in the Opportunities Workshop. The key people invited should be those which have the greatest possible impact and influence on the major items identified in steps 2 and 3 of the process. Ideally, there will be between 7 and 15 people invited to the workshop. These may include:            End User Client/ Customer Designer PQS Project Manager Structural Engineer Services Engineer Main Contractor QS Main Contractor Project Manager Key Specialist Contractors (e.g. M&E, Frame, Finishes) Key Materials Suppliers

7. Nominate an appropriate facilitator. Ideally this needs to be someone neutral and removed from the process. However, this might not be possible. A key factor is that this person is comfortable leading the workshop process and is a skilled facilitator who can make the Opportunity Workshop achieve its objectives whilst striking a good balance between being enjoyable and challenging.

8. Agree the date, time, and venue of the Opportunities Workshop and invite the team. Wherever possible, the workshop should be held in a neutral venue where people are away from their everyday place of work.

9. Prepare and gather the Opportunities Workshop materials. These will need to include:        A flipchart showing the workshop agenda A flipchart showing the Pareto and high level cost breakdown A0 printouts or flipcharts showing appropriate cost details of the 80/20 items Flipcharts showing the prompts for potential opportunities Post-its to capture ideas A flipchart with a blank 2x2 matrix showing benefit and ease of implementation A flipchart showing key customer requirements for the project

10. Hold the Opportunities Workshop. The agenda for the workshop should be as follows: Agenda Item Introductions Details The facilitator welcomes everyone to the workshop and introduces him/ herself. Each attendee then introduces themselves. At this point an “Ice Breaker” could be used, such as asking each person to share an interesting fact about themselves. However it is approached it is key that the Introductions session puts people at ease and in the right frame of mind. The facilitator will then explain the agenda and objectives of the workshop. In essence, the objective of the workshop is to generate a prioritised list of ideas which should help reduce the overall cost and time of the project. It is often a good idea to gather opinions from the attendees beforehand in terms of what they themselves want to get out of the session. These expectations can be gathered on a flipchart and then validated at the end of the workshop to see if they have been met. The facilitator then starts the first of four brainstorming sessions. The “unassisted” brainstorming session should last between 10 and 20 minutes. The team is asked to think about the project and try to come up with as many ideas as possible aimed at reducing or increasing the certainty of cost and time. Each person should write these ideas on a post-it with their initials in the top right hand corner. The facilitator now displays the major Pareto items which were identified in step 2 of the Opportunities Process. This is done by sticking flipcharts or A0 printouts on the walls of the room and asking people to consider these elements. Another session of between 10 and 20 minutes brainstorming is then allowed to take place. Again, each member of the team is asked to write their ideas onto a post-it and work on their own. The third brainstorming session again lasts for the allotted 10 to 20 minute time slot. However, this time the facilitator will display the granular cost breakdown of the major Pareto items which were gathered in step

Workshop Agenda, Objectives, and Expectations

Session 1: Unassisted brainstorming

Session 2: Brainstorming with Pareto of major cost elements

Session 3: Brainstorming with detailed costs

Session 4: Brainstorming with prompts

Prioritisation of ideas using 2x2 matrix

3 of the Opportunity Process. The team is asked to work in pairs and openly discuss and brainstorm together whilst again capturing ideas on post-its. The final brainstorming session involves a series of prompts which are displayed on the workshop walls. These prompts are on Page XX of this document. This list can be reduced or expanded as appropriate. The list consists of numerous ideas which might help reduce the time and costs of the project. The facilitator gets the team to work collectively on this and openly discuss opportunities. The facilitator commits any further ideas onto post-its, again logging the initials of the person who comes up with the idea. It is important not to constrain this final session by imposing a time limit – it should run as long as the ideas are flowing. Following these four structured sessions, it may be possible to have generated upwards of 100 separate ideas. Due to the fact that a number of the brainstorming sessions are carried out in isolation, there may be significant overlap in the ideas. The facilitator will ask each person to group their post-its under certain headings. An initial list of headings can be found on Page XX of this document, but this isn’t exhaustive and should be adapted to fit the ideas generated. Once the post-its have all been grouped, and duplicates removed, the facilitator should then take each individual post-it and ask the team to rate them in order of benefit and ease of implementation. This should be done using a flipchart or A0 2x2 matrix as shown on Page XX. The idea is to place each post-it in one of the four boxes showing low/ high benefit and low/ high ease of implementation. Clearly, the first opportunities to focus on should be those in the top right hand box of the matrix – the high benefit/ high ease of implementation ideas. The facilitator should take each of these post-its and work with the team to agree indicative cost or associated benefits, a target date for delivery, the key stakeholders who need to be involved in making each idea happen, and an ultimate opportunity owner. Once the high priority opportunities are planned in more detail, it is vital to carry out a sanity check against the key customer requirements. It is important to ensure that none of the ideas compromise the requirements in any way. It may be that the team

Detailed planning of high benefit/ high ease opportunities

Filter/ refinement of opportunities through key customer requirements

Review of Expectations and Follow-up

comes up with a fantastic idea which might require a trade-off decision between say, initial capital cost and whole life costs. This decision needs to referred to the relevant stakeholders for consideration. It is vital to think of the Opportunities Process as just that – a process. It does not end at the conclusion of the workshop. In fact, at this point the process actually begins. The facilitator needs to ensure that the team understands that for every 10 ideas delivered (or £10 of benefit identified) there is a probability that less than 50% of these will be taken through to delivery. This will require the team to regularly review their opportunities, and work with the stakeholders they have identified in order to ensure that the correct environment is created which will facilitate benefit delivery. The facilitator should wrap up the workshop by reviewing the expectations which were identified at the beginning of the workshop to ensure these have been met. A date and time should also be agreed for the 2nd Opportunities Workshop which will involve a review of progress and the detailed planning of the next wave of opportunities. If appropriate, the 2nd workshop could also include more brainstorming to generate ideas.

11. Distribute the workshop output to attendees. An Opportunities Log should be a key output. A list of the data required to create this log can be found on Page XX. Following the workshop, the facilitator should arrange for the output to be circulated to all attendees.

Brainstorm Prompts Increase partnering with suppliers:  Increase collaboration and partnering  Improve supplier performance  Implement targeted value management  Increase open book working  Implement long-term agreements  Increase contractual incentivisation  Create supplier clusters (e.g. plasterboard supplier working with drylining contractor) Increase competition:  Conduct price & performance benchmarking  Increase the number of suppliers  Model & challenge “should costs”  Validate second sources Reduce consumption:  Carry out consumption analysis (i.e. identify the waste)  Reduce maverick buying (ie. from non-validated sources) Reduce life-cycle costs:  Optimise make, supply, install and maintain  Investigate market hedging  Improve integrated planning with suppliers  Share processes with suppliers  Carry out collaborative risk and opportunity management  Bundle/unbundle work packages (e.g. doors and ironmongery)  Optimise inventory (e.g. supplier owned inventory)  Reduce logistics costs  Increase right first time  Involve suppliers earlier in design process Deepen collaboration across/ down the supply chain:  Create buy clubs between suppliers  Focus on lower tiers of supply chain (e.g. manufacturers not merchants)  Use suppliers as category managers Consolidate spend:  Consolidate spend across projects  Consolidate spend across suppliers  Reduce the number of suppliers  Improve demand forecasting  Increase visibility of spend

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Widen scope of supplier services (e.g. both mechanical and electrical)

Reduce transactions:  Consolidate invoices  Automate buying processes  Consolidate terms and conditions Optimise specifications:  Consolidate material specs  Carry out value analysis/value engineering  Investigate new technologies  Move to functional rather than descriptive specs  Use industry standard specifications  Understand end customer value drivers  Implement and optimise quality grades (e.g. good, better, best) Optimise costs:  Improve magement of time/cost/quality metrics  Carry out whole-life costing analysis  Increase productivity on site  Increase local sourcing  Investigate low cost country sourcing  Bundle repair and maintenance spend into capital  Work with key manufacturers to simplify processes

Opportunity Groupings        Contracts and Commercial Arrangements Information and Decision-making Labour and Productivity Materials and Components Programming and Scheduling Resourcing and Fees Specification and Design

2X2 Benefit/ Implementation Matrix

Priority 2
High Ease of implementation
“Quick Wins”

Priority 1
“Critical to Success”

Priority 4
Low
“Leave”

Priority 3
“Nice to have”

Low

Benefit

High

Opportunity Log Ideally, the Opportunity Log should be a Microsoft Excel document which has the following data fields:         Idea Description Opportunity Grouping (see Page XX) Idea Generator Idea Owner Associated Stakeholders Benefit Priority Ranking (see Page XX) Targeted Benefit (e.g. £) Target Delivery Date

Appendix 5: The Opportunities Process
1. Obtain Cost Breakdown 2. Create Pareto of major cost items

Data
3. Identify major cost items in 80/20 4. Understand Key Customer Requirements 5. Identify Workshop Attendees 6. Nominate facilitator

Prep
7. Agree Workshop date, time, and venue 8. Prepare Workshop Materials 9a. Introductions 9b. Workshop Agenda, Objectives, and Expectations 9c. Session 1: Unassisted Brainstorming 9d. Session 2: Brainstorming with Pareto of major cost elements 9e. Session 3: Brainstorming with detailed costs

Process
9f. Brainstorming with prompts 9g. Prioritisation of ideas using 2x2 matrix 9h. Detailed Planning of high benefit/ high ease opportunities 9i. Filter/ refinement of opportunities through key customer requirements 9j. Review of Expectations and Follow-up 10. Distribute outputs DELIVERY OF OPPORTUNITIES

Action


				
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