METHODOLOGY APPROACH
The Inductive research approach is chosen to perform the research because not ample theories or research is developed in the value addition along the lifecycle of the construction project. The research is carried out through the following steps in Figure 1.
DATA COLLECTION
The mixed data collection method is selected, because through the Qualitative analysis, a deep understanding of the basics of value and the characteristics of each project management activities are studied. The reason for cost overrun and the impact study during the COVID-19 is carried out, to address the issues in the construction industry. The research areas which has not to be explored and the research gaps are founded. An initial framework is derived, which overcomes the challenges in the construction industry.
Quantitative data collection is carried out to produce the conceptual real-time knowledge, which supports the ideas generated. The industrialist inputs are collected through the questionnaire and quantitative data analysis is done to check the reliability of the primary data collected.
QUALITATIVE DATA COLLECTION
CONTENT ANALYSIS
To get a better insight into the basic characteristics of the project management activities and their synergetic relationship between value engineering and other project management activities, literature, and reports are collected. Various journals have tried to link the lean construction and value engineering process to attain value addition along the design stage and construction stage. The research has not proceeded further to establish the framework of value addition along the entire lifecycle. The research gaps are identified.
RESEARCH QUESTION
The research is emphasizing the value addition in the entire lifecycle of the project is not been explored much. The integration of value engineering with other project management areas and benefits attained is still under research. This research paper primarily answers the following questions
- Why do we need to integrate the value engineering and other project management activities?
- What are the benefits of doing that?
- How COVID-19 impacts can be resolved by considering the Value-driven project delivery model?
QUANTITATIVE DATA COLLECTION
SURVEY
To support the idea of a value-driven project delivery model, the survey consists of 4 open questions and 6 questions that were measured to the scale of 5 points Likert scale. The aim is to get responses from 50, quantity surveyor, project manager, and facility manager, and the Questionnaire has been circulated among various mediums. Some of the questions are
- How COVID-19 outbreak has impacted the project you are Woking on?
- Has any project revived measures framed?
- Have you implemented any of the following in your project?
- If not, what was the reason
Likert 5 scale Question
- Adding more value and optimizing the process, product, and services are very crucial
- integration of value engineering with other project management activities is beneficial
- Executing a value enhancement of construction progress along the entire lifecycle is possible
- Value-driven project delivery model will provide balance along with the scope, schedule, cost
- value-driven facility management leads to innovation and adds value despite the budget constraint
- Value integrated delivery model will revive the project back to track
DATA ANALYSIS
Table 1.Cumalative Percentage of respondents
|
Strongly disagree
|
Disagree
|
Agree or disagree
|
Agree
|
Strongly Disagree
|
Question 1
|
6%
|
8%
|
8%
|
16%
|
62%
|
Question 2
|
2%
|
4%
|
2%
|
20%
|
72%
|
Question 3
|
8%
|
4%
|
8%
|
28%
|
52%
|
Question 4
|
4%
|
4%
|
6%
|
38%
|
48%
|
Question 5
|
2%
|
4%
|
8%
|
26%
|
60%
|
Question 6
|
4%
|
4%
|
14%
|
26%
|
52%
|
Source : Author
The Cumulative percentage of total count for each question is listed in the table .The mean of the Likert data lies between the agree to strongly agree
HYPOTHESIS TESTING
Non-parametric Test: Chi-square test was conducted through SPSS software. Since the Likert data are ordinal, a nonparametric test is done. SPSS is statistical analysis software used to analysis independent data of Likert scale. To
Table 2. Hypothesis test summary
|
|
Null Hypothesis
|
Test
|
Sig.a,b
|
Decision
|
1
|
The categories of VAR00001 occur with equal probabilities.
|
Chi-Square Test
|
.896
|
Retain the null hypothesis.
|
2
|
The categories of VAR00002 occur with equal probabilities.
|
Chi-Square Test
|
.896
|
Retain the null hypothesis.
|
3
|
The categories of VAR00003 occur with equal probabilities.
|
Chi-Square Test
|
.896
|
Retain the null hypothesis.
|
4
|
The categories of VAR00004 occur with equal probabilities.
|
Chi-Square Test
|
.896
|
Retain the null hypothesis.
|
5
|
The categories of VAR00005 occur with equal probabilities.
|
Chi-Square Test
|
1.000
|
Retain the null hypothesis.
|
6
|
The categories of VAR00006 occur with equal probabilities.
|
Chi-Square Test
|
.896
|
Retain the null hypothesis.
|
a. The significance level is .050.
|
b. Asymptotic significance is displayed.
|
Source: Author
Table 3. Reliability Statistics
Cronbach's Alpha
|
Cronbach's Alpha Based on Standardized Items
|
N of Items
|
.987
|
.992
|
6
|
source: Author
Table 4. Reliability statistics if item got deleted
|
Scale Mean if Item Deleted
|
Scale Variance if Item Deleted
|
Corrected Item-Total Correlation
|
Cronbach's Alpha if Item Deleted
|
Question 1
|
49.8000
|
3200.700
|
.958
|
.984
|
Question 2
|
49.8000
|
2839.200
|
.979
|
.987
|
Question 3
|
50.0000
|
3416.000
|
.989
|
.983
|
Question 4
|
49.8000
|
3383.200
|
.916
|
.988
|
Question 5
|
49.8000
|
3127.200
|
.999
|
.980
|
Question 6
|
49.8000
|
3383.200
|
.984
|
.983
|
source: Author
The Likert data are analysed for Reliability analysis using SPSS .The Cronbach alpha value shows the reliability value of the data collected .The reliability test is done for each question .The α value is more than 0.9 in all the cases .So the data collected has excellent internal consistency and very much reliable .
The Interpretation is the Industrial professional agrees with integration of value engineering with various project management activities will result in reviving the bloated construction project into track and basically agree with the core idea of the value integrated project delivery model. Since the null hypothesis is selected and data are consistent for all the individual conditions, research proceeded to develop the framework model, value integrated project delivery model.
V. IMPACT STUDY OF COVID-19
1. FACILITY MANAGEMENT
There is immense growth in the facility management sector and space allocation of office rooms needs to be reconsidered. Satellite offices to overtake the co-working model. Building health will increasingly gain importance in the long term.
Knight Frank reported Facility management market size is around USD 14.98 million. The total area of the requirement under organized FM is 3000 million sq. Ft. Portfolio shares concerning office around 65 percent,10 percent retail, and residential around 25 percent. The cost of the FM would raise approximately 6-9 percent on account of wellness, customer care, automation, skilled manpower, hygiene.
JLL India, which manages 420 million square ft area, said that maintenance cost would raise.
2. IMPACT IN REAL ESTATE
The Net absorption and Gross leasing activities have seen declination by 2/3, which is a 40 % decrease compared to Q1 2019, and sales of residential units have dropped to 30-40 in the top 7 cities.
The demand of up to 15 % more space in houses for making it feasible for work from home. The gated community will be preferred, even in tier 3 and Tier 4 cities. Housing loan rate of interest came down to 7.40 %, which will boost the buying capacity, and depicting Rupee against dollar allows NRIs to invest in the residential sector.
3. SUPPLY CHAIN MANAGEMENT
The availability of material and machinery and way of procuring it from different countries will be difficult and due to the shortage of cement and sand, the price has been increased. There is De-globalization of supply chain management. The project dependents on special equipment, fixtures, robotics, and exporting construction material to a foreign country are more likely to get disruptions by supply chain management.
4. LABOR PRODUCTIVITY
Migrant workers comprise at least 80% of the total workforce population in the construction sector. 30% of the available workforce is still away from the site due to the fear of the Coronavirus. It will take around 3 -4 months for migrant workers to come back to sites and their productivity will be affected not in excess by 30% (RLB , 2020). Reverse migration creates a labor shortage and increases labor costs. Four state governments have passed an order to increase the labor working hours from 8 hours working day to 12-hour working day, but it will shift the burden towards the labors.
5. CONTRACTUAL OBLIGATION
The traditional project delivery model does not share the risk mutually along with the client and subcontractor. So integrated project delivery model with mutual risk-sharing should be followed Clients / Employers should take care about instructing the closure of sites or for other actions to be taken by contractors to combat COVID-19. This could leave the contractor in a better position under the contract terms than where the contractor elects to close the site or to take relevant action. Force majeure closure in the contract if not well defined it may end in conflicts
6.ECONOMIC IMPACT
- The labour costs for the skilled worker are expected to rise by 20 to 25 % and for the semiskilled and unskilled worker are expected to rise by 10 %
- The additional Interest cost for capital working loan during the delay in the construction period
- Cost of the project will be increased by providing the personal safety equipment, labour health insurance and making the construction site resilient to the infection spreading and Revised health and safety procedures
- Nonlinear project cost may raise by 2 to 5 percentage of the total cost
- The recovery of liquidated damages would be not possible for certain sectors like solar projects, where the force majeure clause is not included in the power purchase agreement.
7. VIRTUAL WORKFORCE
Problems like sharing information, lack of clarity, no proper guidance, tracking the performance will affect the productivity and reliable workflow. The transparency of the construction sector is still a question mark even before the COVID-19 outbreak.
8. DIGITALIZATION
- Instead of replacing the labor by robots, most of the construction robots are there are to aid and enhance the worker’s performance. The predictable activities like bricklaying, rebar bending, and welding, robots can be used. Artificial intelligence can be used to monitor site progress in real-time. Virtual reality can help users to visualize spaces from any location.
- Use of Modular construction, prefabricated construction, Internet of things, wearable and site sensors, Future proof,3-D printing has made construction sites safer, increased productivity, improved collaboration, and to mitigate risk like COVID-19 in the future
9. SCOPE
Change in the strategy, Schedule of the project will be changed comply to the government guidelines, and costing needs to be done again. plan for revival for the project should be made based on the outbreak impact in the project region.
Resolve immediate challenges. Re-entry creates a detailed plan to enter business quickly. Reform according to the roles and regulation of government. Respond to the nearest cash management and other issues. Reimagine, the new way of working with new technology. (KPMG, May 2020)
10. BIDDING PROCESS
contractor participation in the bidding process will be less. The modification of the tender should not alter the overall nature of the contract.
11. ECONOMIC RECESSION
1.The construction sector is already facing financial stress, RERA regulation, tight working capital but along with this COVID-19 outbreak impacts like a disruption in work, and movement of labor, recovery would be very challenging
2.Goldman Sachs put out the GDP growth forecast for India at 1.6%, down from 3.3%
3.Liquidity risk may cause the client and contractor to stop the work due to the overall fragile economic scenario
4.It is too not early to estimate the full financial impact of the coronavirus crisis. Moreover, the upcoming monsoon will additionally severely obstruct work from June 2020, it will take 7-8 months to completely resumes the work
IV.SYNERGY BETWEEN VALUE ENGINEERING AND OTHER PROJECT MANAGEMENT ACTIVITIES
Table 5.Synergy between value engineering and lean construction
|
Value Engineering
|
Lean construction
|
Cost Reduction
|
Adding value
|
Adding value through reducing the waste, delay and increasing the reliability, cost reduction is achieved
|
Process
|
Understanding the client requirement and suggesting the alternative to satisfy the functionality requirement
|
It involves the Last planner to decide their work and responsibility which needs to be completed rather than push them to do
|
Approach
|
Analytic approach
|
Strategic approach
|
Waste Elimination
|
It thrives for Immediate waste reduction
|
It is a continuous process
|
Stages
|
It has a systematic process -6 steps
|
Plenty of Tools are there for lean construction
|
Effectiveness
|
It produces result during the pre-construction stage
|
It can be effective in all the stages
|
Team
|
VE team is responsible for suggesting the alternatives
|
Involves the last planner is planning process
|
Risk
|
Major Performance criteria are decided by most cost consuming items and based on risks
|
Constraints log are maintained to find the stakeholder who is responsible
|
Techniques
|
Pareto 80/20, FAST diagram, LCCA, Quality Deployment chart are used
|
PPC, Variance Chart, LPS, Value stream mapping are used
|
Assessment
|
The post-mortem report is used to analyse the effectiveness of value Engineering
|
Lean rapid rating model is used to find the effectiveness of the project
|
Effectiveness
|
It produces Greater result mostly in the Designing Stage
|
It can be applied to all the stages from procurement and tendering like lean project delivery method to an effective way of doing payment bills
|
Safety
|
Safety and environmental impacts are assessed for the alternatives
|
Safety and health hazards are managed and monitored
|
Client Inclusion
|
Client satisfaction is incredibly low
|
Client satisfaction can be improved by 5S
|
Source : Author
BUILIDING INFORMAION MODELLING
BIM enables us to visualize the component with its lifecycle cost so it will be easy to find the cost consuming building component and to find alternatives for that. All the information regarding the building components is clearly shown by BIM levels, which enables us to choose an appropriate alternative in terms of cost, timeframe for completion, sustainability, risk, and performance.
Embracing the potential and uses of BIM would save time so the LeVC could understand and analyze the building and client requirements more than spending the time in estimating the lifecycle cost and gathering the information together.
LIFECYCLE COST ANALYSIS
Value engineering and lifecycle cost analysis should be done simultaneously to a product. Both of them are different concepts of cost management. Life cycle analysis would help to identify the operating and maintenance cost, terminal value, and occupancy cost incurred along the life span of the product and inflation rate at the element level, component level for options appraisal are considered. The life cycle cost analysis is done along the evaluation phase of the value engineering to help to find the best alternative, which serves the same performance requirement. In the evaluation phase, the best alternative can be chosen if the alternative design is chosen based on the lifecycle cost rather than the unit cost of the product, which enhances the net saving. The initial cost of the product may be low but the maintenance and operation cost will be high. Knowing the physical cost of the product is very essential.
The lifecycle cost can be calculated in two ways. One using the historical cost data of similar projects. The second one is the usage of sensitivity analysis which elements are more sensitive to change . Cost Sensitivity shows the degree or extent of change of the Life Cycle Cost of a project with a change in the parameters such as cost, quality, scope, and schedule. Cost Sensitivity Analysis is the trial analysis to address the variability of parameters along the life cycle. The Life cycle cost estimate at different stages of construction is calculated, which can be used for cost benchmarking.
FACILITY MANAGEMENT
Considering the current pandemic situation, Space management and Health and safety service of Facility management gained so much importance. Every commercial building needed to be respaced for their office space and separate rooms is needed to be provided for employers. The Blue-collar worker's needs are onward surge for regular maintenance of the building and workload among them should be reduced. But the Facility management services have also restricted with the limited budget, innovation, and technology are exceptionally low due to the budget constraint. The value-driven faculty management would provide the intended of cost-saving and functionality for the facility management services. Both value engineering and facility management focus on improving the functionality of the building. Key benefits of value driven facility management are
- Encouraging innovative ideas in facility management by value approach
- Choosing technologies like the Internet of things which reduce the workload on the blue-collar employee
- Understanding the client requirement and accomplish it, will be easier by value-driven faculty management
- Value and function of each service are known, so the quality and budget of a different company can be analyzed, and the best one can be chosen
- KPI are decided to monitor the work progress, value, and effect