The emerging view of projects as value creation processes: recent studies on social housing in Brazil. Prof. Carlos T. Formoso, Ph.D.

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1 The emerging view of projects as value creation processes: recent studies on social housing in Brazil Prof. Carlos T. Formoso, Ph.D. Head of the Construction Management and Economics Group at the Federal University of Rio Grande do Sul (UFRGS), Porto Alegre, Brasil Currently a Visiting Professor at the School of Built Environment of the University of Salford, U.K.

2 Federal University of Rio Grande do Sul UFRGS Porto Alegre, Rio Grande do Sul State

3 Construction Management and Economics Group Size of the group 5 academic staff (Civil Engineering, Architecture, and Production Engineering) 20 research students (15 full-time) Main research interests Production management (application of Lean Production ideas into Construction) Product development and Design Management Performance measurement and benchmarking Organizational learning

4 Problems of traditional Project Management approaches Traditional project management approaches are not able to cope with the level of complexity that exist in many projects (Williams, 2002) Projects cannot be regarded as a linear progression from activities to pre-established objectives (Atkinson et al., 2006) Managing as planning (or as adhering) Projects are treated similarly without enough consideration of the context (Winter et al., 2006) It is often necessary to carry out interdependent multiple projects that demand major changes in organizations (Maylor et al. 2006)

5 Problems of traditional Project Management approaches Theoretical foundations need to be changed, by incorporating operations management concepts and principles (Koskela and Ballard, 2006) Professional literature on project management is poor in terms of content e.g. value (Koskela and Howell, 2002; Koskela, 2008) Academic research has had little impact in professional practices (Laufer, 2010) Too much focus on the project realization (execution) without full consideration of the project life-cycle (investment myopia) (Thorp, 1998)

6 Hard and soft dimension framework (Atkinson et al., 2006)

7 Project as complex systems (Williams, 2002) Structural complexity: Number of elements Interdependences between elements Uncertainty: In goals In methods

8 Some typical characteristics of complex construction projects Some are fast projects (e.g. commercial and industrial projects) Multiple stakeholders, multiple objectives Participation of the community Broad scope, often involving a combination of products and services Highly influenced by the context (social and political)

9 Value generation in project management Projects are frequently delivered on time and on budget, but still fail to deliver expected benefits (Thorp, 1998) Traditional value management techniques are mostly focused on products, or require specialists to be applied (e.g. QFD) Evaluations of Construction Projects are often focused on physical products, rather than on the overall impact of the project Most post-occupancy evaluation assessments

10 The understanding of projects as value creation processes Value should be expanded from product creation to generating benefits, aligned with organisation strategy and considering different stakeholders (Winter et al. 2006) The goal of an organization should not be to create value for customers but to mobilise customers to create their own value (Normann and Ramirez, 1993)

11 The understanding of projects as value creation processes The main issue is to understand the relationship between project outputs (what is being done) and expected outcomes (why is being done) (Winter and Szcepanek 2010) Projects create deliverables, and the combination of these deliverables generates the capabilities that enable the desired benefits to be achieved (Reiss et al., 2006) The generation of benefits generally exceeds the boundary of project implementation (Winter et al., 2006)

12 G&P C A Peace of mind No hassles Reliable Driving ease No pressure tactics Treat you intelligently Frequency of repair Doesn t break down Service response Mechanics know their stuff Don t abandon you after sale Comparable service accross dealers CR recommended Fuel indicator Layout of instruments Comfortable seats Plush Comfortable ride Smoth shift Inside light switch Size (WOODRUFF et al., 1993) Illustrative customer value hierarchy

13 Construction Project as a Product Development Process Concepts and theories from different fields: Operations Management Marketing Design Sustainability

14 Value and satisfaction Value and satisfaction expectation expected performance performance perceived value comparison between performance and expectations disconfirmation may (not) result in customer satisfaction (adapted from OLIVER, 1997)

15 Construction Project as a Product Development Process Application in different project contexts: Health Care Housing Industrial Building Infra-structure, etc. Several construction companies have changed from builders to product development organizations, and starting playing a leading role in the industry

16 Innovative value management approaches in Construction Projects (Tillmann, 2011) Integrated Programme Management Cycle Model Project Cycle Management Design Quality Indicator Benefits Realisation Lean Project Delivery System Forms of contracting that support collaboration Holistic and dynamic view Stakeholder engagement and participation Strategy alignment Collaboration among teams Learning and adaptation Outcomes assessment

17 Changes in the meaning of value (on-going research) Focusing on the delivery of physical products Final client should be identified Value results from a delivery of a product to the final client Focus on the benefits obtained from a combination of products and services Different stakeholders should be considered Cients should be mobilised to create their own value

18 Changes in value generation process (on-going research) Identify and engage stakeholders Create a visualisation of the project purpose and expected results that can be shared by all stakeholders Understand the political and social context Expected benefits should be continuously assessed Means and ends are simultaneously defined

19 Changes in value generation process (on-going research) Establish an overall view of the project, considering its different phases, rather than managing phases separately Create a governance structure, in which responsabilities are shared Innovative procurement strategies Create suitable conditions for collaborative work Evaluate both the outcomes and the impacts of the project Tangible and intangible aspects should be considered

20 Brazil in numbers Area: 8,511,965 sq km Population: 183 million (2007) GNP: US$ 3,143 billion (2009) Construction industry is 9.2 % of GNP (around 15% if included all supply chain) Housing shortage: 8 million families need houses 91 % of the shortage is for families with monthly income between 0 and 3 minimum wages

21 IMF expectation of growth for several countries (2010) Despite the world economic crisis, the expection of growth for Brazil is 4-5% for 2010

22 Construction industry in Brazil Construction industry is booming: Growth rate is around 25% higher than the economy (5% a year) Major changes are happening in the construction industry Government has increased investments in infra-structure and social housing Increasing investments in Real Estate from the Stock Market Large house building companies are geographically expanding their operations

23 Construction Industry: growth in the number of jobs The construction industry has played an important role in the recovery of Brazil after the economic world crisis

24 Construction Industry: growth in housing loans Funding for housing projects has increased tenfold in 7 years

25 Main Government funded house building Programs My House, My Life (MCMV) 19 billion dollars 1 million housing units Families with monthly income between 0 and 10 minimum wages

26 Main Government funded house building Programs Economic Growth Acceleration Program (PAC) 59,5 billions dollars for housing for all 27 Brazilian States

27 Major changes in social housing There is a trend of reducing the participation of the State as a direct developer or client in the Brazilian construction industry (like in other countries) The promotion of social housing projects tends to get descentralized and diverse public and private organizations assume new roles

28 Major changes in social housing Growing complexity in terms of financing, regulations, social issues, project management Need to change the way social housing projects are managed: Developing new competences in public organizations Changing the role of private organisations in construction projects Creating alternative forms of financing

29 Main research topics on social housing at UFRGS Customer requirements management Evaluation of project outcomes and benefits Introduction of mass customisation ideas

30 Critical Product Development activities CONTRACT WITH THE BANK CONCEPTION & DESIGN PRODUCTION OCCUPATION & USE BANK AGREEMENT BUILDING SITE SEARCH BUILDING SITE & SURROUNDNIG ANALYSIS BUILDING SITE OPTIONS DESIGN DIRECTIVES search for the land OR REGISTRATION plot and the PUBLICIZING assessment INITIAL by the REGISTRATION National 2 Savings Bank BUILDING OPTION PROCUREMENT CONSTRUCTION COMPANY SEARCH FEASIBILITY STUDY ANALYSIS PRODUCT DESIGN PHYSICAL AND FINANCIAL SCHEDULING ANALYSIS APPROVAL APPROVAL BUILDING/ SITE PROCUREMENT 1 PRODUCTION SYSTEM DESIGN PHYSICAL AND FINANCIAL SCHEDULING REVIEW PRODUCTION/ PCP INSPECTION AS BUILT MANUAL DELIVERY TO THE BANK PROJECT INSPECTION APPROVAL FAMILIES SELECTION APARTMENT monitoring CHOOSE of the project by the Bank SOCIAL PROJECT ASSISTANCE development of ESTATE AGENT the CONTEST architectural design and a new INITIAL REGISTERED round of MEETING assessment by REGISTERED the Bank and INTERVIEW also by the Local Governement FINANCIAL ANALYSIS APPROVAL FAMILIES SPREADING 2 UNITS INSPECTION UNIT OCCUPATION PHASES KEY CRITICAL ACTIVITIES ESTATE AGENT PERMIT FOR LIVING/ LICENSE BUILDING MANAGEMENT FINANCIAL MANAGEMENT SOCIAL PROJECT ASSISTANCE PROPERTY EVALUATION operation OF TRANSFER and TO USERS USER- AFTER 15 SATISFACTION maintenance YEARS LEASE PERIOD management, CONCEPTION & financial DESIGN CONCEPTION management OF FURTHER and PROJECTS social PRODUCTION work CITY HALL CONSTRUCTION COMPANY BRASILIAN PUBLIC SAVINGS BANK

31 Mapping customer processes CONCEPTION AND DESIGN PRODUCTION OCCUPATION AND USE DEMAND PROFILING CITY COUNCIL AGREEMENT PROJECT ANNOUCEMENT 2 SELECTION OF LEASERS INTERVIEW FINANCIAL ANALYSIS listagem dos aprovados DELIVERY PROJECT INSPECTION APROVAL USE DWELLING OCCUPATION FACILITIES MANAGEMENT 1 ENROLLMENT Signing contract F.M. BIDDING MEETING CANDTES. PROJECT DELIVERY HAND OVER INSPECTION LEASER SELECTION DRAWING OF UNITS UNIT INSPECTION SIGNING CONTRACT FINANCIAL MANAGEMENT SOCIAL WORK FINAL DELIVERY 1 2 GILIE GIDUR EN CEF LEASER f.m. COMPANY CITY COUNCIL DEVELOPER 1 New project selection 2 Social work

32 Clients requirement management Due to the increasing complexity of product development in the construction industry, more effort should be spent on clients requirements management: Capturing client requirements Making them explicitly available for the product development team Controlling whether the requirements of different stakeholders have been properly balanced

33 Client requirements management Identifying, analyzing, setting priorities and making available information on needs and preferences of the building project main clients Conception Design Production Use requirements capture increase value

34 Clients requirement management Need to process client requirements to present information in a form that enhances the understanding of the product development team on what the client desires: Conflicting interests from different stakeholders (Kamara et al., 2002) Due to the nature of client requirements some of them are not easily made explicit by the clients (Griffin and Houser, 1991)

35 Individual analysis: data grouping I PRIMARY POSITIVE SECONDARY POSITIVE CRITICAL PRIMARY NEGATIVE SECONDARY NEGATIVE FACTOR CRITICAL POINTS POINTS CRITICAL POINTS CRITICAL POINTS general maintenance/delay about shops/work/university return/services ("the facility management company doesn't location ("good location") LOCATION solve the problems") city centre elevator ("always with problems") public transport is near accounts provision ("I don't know facility management company what I'm paying for") own house water, problems with the pumb/box acquisition /leasing price of water PAR lack of communication of the relationship with banking responsible neighbourhood/contact with EXPERIENCE IN relationship with the facility neighbours CONDOMINIUM manager flat size/good space FUNCTIONS OF expensive gas "good flat, with balcony" THE HOUSING UNIT there isn't laundry room infrastructure of the place community room size of the flat CONDOMINIUM housing unit "the number of flats is not big QUALITY few points of electrical installation and it is full" security facility management company cleannes SECURITY SERVICE OF FACILITY MANAGEMENT COMPANY expensive instalments/we can't pay before 15 years relationship with banking FACTOR SERVICE OF FACILITY MANAGEMENT COMPANY FUNCIONS OF THE HOUSING UNIT good finishes ("well done") FINISHES QUALITY noise LOCATION finishes termite on the floor FINISHES QUALITY collective antenna CONDOMINIUM QUALITY Positive and negative critical points were grouped in two levels: primary and secondary PAR

36 Individual analysis: language standardization 1 7) Urbanized region 2 9) Own house Which of the five things did you like best? 7) Urbanized region 7) Easy access to shops 8) Good neighbours 7) Easy access to public transport 4) Small laundry Which of the five things did you like least? ) Good location 8) Good neighbours 7) Good location 2) Good infrastructure 2) Community room 4) Good design of the housing unit 7) Good 4) Good size of 9) Cheap location the housing unit installment 7) Urbanized region 7) Pleasant place 7) Good location 10 9) Own house ) Good size of the housing unit 7) Urbanized region 9) Cheap installment 14 9) Own house CAPTION 9) Cheap installment 1) Cleannes of the condominium 8) Good neighbours 9) Easily acquisition 7) Good location 4) Good design of the housing unit 9) Own house 7) Easy access to welfare services 7) Urbanized region 9) Cheap installment 9) Cheap installment 9) Easily acquisition 4) Good design of the housing unit 1) SERVICE OF FACILITY MANAGEMENT COMPANY 2) CONDOMINIUM QUALITY 7) Good location 2) Good number of buildings 8) Good neighbours 7) Good location 8) Good neighbours 9) Cheap installment 6) Good quality of finishes 3) Security 9) Not to make a down payment 9) Good relationship with the Bank 1) Bad service of the facility management company 7) External noise 1) Lack of preventive maintenance 4) Small housing unit 9) Bad 1) Difficult to relationship with contact the the Bank facility manager 1) Bad service of the facility management company 7) External noise 1) Lack of elevators maintenance 1) Bad service of the facility management company 6) Bad quality of the floor 1) Delays on services providing 1) Accounts provision is not clear 1) Lack of elevators maintenance 1) High cost of gas 1) Bad communication among employees 4) Few points of electrical installation 9) Payment in 15 years 1) Delays on services providing 9) Expensive installment 1) Lack of water systems maintenance 1) Delays on services providing 1) Lack of elevators maintenance 1) Accounts provision is not clear 3) SECURITY 5) COMFORT CONDITIONS 7) LOCATION 9) PAR 4) FUNCTIONS OF THE HOUSING UNIT 6) FINISHES QUALITY 8) EXPERIENCE IN CONDOMINIUM 1) Lack of water systems maintenance 10) CONSTRUCTIVE PROBLEMS 2) Lack of antenna data was reduced by using a standardized language

37 Ranking of customer satisfaction factors RANKING DOS FATORES DE SATISFAÇÃO E DE INSATISFAÇÃO H B I A G C D F E MÉDIA FATORES APARÊNCIA EXTERNA DO CONDOMÍNIO COMO UM TODO 3,73 4,06 3,86 4,19 4,07 4,00 3,97 3,74 3,64 3,95 1 ILUMINAÇÃO NATURAL DOS AMBIENTES 3,94 3,88 3,93 4,04 3,95 3,88 3,82 4,26 3,92 3,94 2 FUNCIONAMENTO DAS INSTALAÇÕES HIDROSSANITÁRIAS 3,76 4,03 3,86 3,69 3,89 3,50 3,85 4,04 3,84 3,83 3 BANHEIROS 4,06 4,06 3,71 3,50 4,01 4,09 2,79 3,57 4,04 3,78 4 FUNCIONAMENTO DAS INSTALAÇÕES ELÉTRICAS 3,97 4,00 3,79 3,65 3,43 3,84 3,74 4,04 3,96 3,77 5 ESTAR E JANTAR 3,76 4,03 3,71 4,00 3,74 3,72 3,26 3,96 3,88 3,76 6 FUNCIONAMENTO JANELAS 3,64 3,78 3,93 3,85 3,92 3,72 3,31 4,09 3,36 3,73 7 DORMITÓRIOS 4,06 3,88 3,79 4,00 3,85 3,47 3,13 3,61 3,64 3,71 8 FUNCIONAMENTO PORTAS 3,58 3,53 3,86 3,92 3,59 3,91 3,28 4,26 3,44 3,66 9 GUARITA 3,85 3,84 4,04 3,50 2,75 3,78 3,84 3,61 10 SEGURANÇA DOS ACESSOS PRINCIPAIS DO CONDOMÍNIO 3,88 3,94 4,04 3,53 3,03 3,43 3,48 3,60 TEMPERATURA INTERNA NO VERÃO 3,70 3,63 3,79 3,81 3,28 3,88 3,56 3,48 3,92 3,60 11 SEGURANÇA DOS ACESSOS PRINCIPAIS DOS BLOCOS 3,84 3,36 3,88 3,42 3,50 3,36 3,57 3,52 3,54 12 SEGURANÇA DO CONDOMÍNIO COMO UM TODO 3,88 4,13 3,71 4,19 3,50 2,94 3,38 2,87 3,16 3,53 13 ENTRADA DO BLOCO 3,78 3,21 3,62 3,30 3,84 3,41 3,74 3,08 3,48 14 ESCADAS E CORREDORES 4,03 4,00 3,85 2,73 3,78 3,72 3,39 3,40 3,46 15 SEGURANÇA À ENTRADA DE TERCEIROS NO APARTAMENTO 3,88 3,69 3,93 3,65 3,45 3,19 2,90 3,61 3,20 3,45 TEMPERATURA INTERNA NO INVERNO 3,67 3,16 3,79 2,77 3,74 3,34 3,77 3,04 3,24 3,45 PRAÇA INFANTIL 3,39 3,59 3,73 3,68 3,22 3,04 2,92 3,44 17 TETOS DE BANHEIROS, COZINHA E ÁREA DE SERVIÇO 3,85 3,53 3,64 3,19 3,65 3,16 3,54 2,61 2,56 3,38 18 PAREDES DE BANHEIROS, COZINHA E ÁREA DE SERVIÇO 3,70 3,44 3,57 3,58 3,47 3,09 3,10 3,09 2,92 3,34 COZINHA 3,64 3,34 3,57 3,08 3,64 3,03 3,08 2,83 3,44 3,34 SALÃO DE FESTAS 3,97 3,47 3,43 3,65 3,31 3,59 2,23 3,26 3,12 3,31 20 ÁREA COM VEGETAÇÃO (ÁREA VERDE) 3,39 3,53 2,88 3,42 3,44 2,61 3,08 3,27 21 PISOS DE BANHEIROS, COZINHA E ÁREA DE SERVIÇO 3,76 3,41 3,57 3,04 3,58 3,50 2,54 2,26 2,52 3,20 22 ESTACIONAMENTOS 3,36 3,53 3,15 3,08 3,31 2,91 2,84 3,18 23 PISOS DOS DORMITÓRIOS 3,70 3,31 2,64 2,85 3,31 3,50 3,41 2,09 2,56 3,16 24 PISOS DE ESTAR E JANTAR 3,76 3,34 2,79 3,04 3,31 3,53 2,90 2,17 2,48 3,13 25 PAREDES E TETOS DOS DORMITÓRIOS, ESTAR E JANTAR 3,21 3,25 3,14 3,04 3,31 2,94 3,10 2,22 2,60 3,05 26 ÁREA ESPORTIVA 2,66 3,58 2,84 2,99 27 ATENDIMENTO NA PRESTAÇÃO DE SERVIÇOS 3,03 3,06 2,93 2,85 3,09 2,69 2,85 2,70 2,44 2,89 28 NÍVEL DE RUÍDO 3,15 3,06 2,36 2,92 2,82 2,91 2,64 3,04 2,32 2,83 29 COMUNICAÇÃO 3,03 3,41 2,71 2,96 2,46 2,91 3,13 2,74 2,24 2,82 30 TRANSPARÊNCIA NA PRESTAÇÃO DE CONTAS 3,03 2,57 2,73 2,43 2,12 2,64 31 ÁREA DE SERVIÇO 3,48 2,94 2,64 2,42 3,26 2,19 1,54 1,91 2,28 2,62 32 CUSTO DO CONDOMÍNIO 2,24 3,79 2,34 1,91 2,04 2,34 33 MÉDIA EMPREENDIMENTOS 3,58 3,57 3,48 3,45 3,40 3,32 3,20 3,18 3,12 GERAL LEGENDA FORTEMENTE INSATISFEITO INSATISFEITO NEUTRO SATISFEITO FORTEMENTE SATISFEITO 16 19

38 Ranking of satisfaction factors Satisfaction factors may be weighed by critical points LUGAR AGRADÁVEL BAIXA PRESTAÇÃO BOM RELACIONAMENTO COM VIZINHANÇA FÁCIL ACESSO A TRANSPORTE PÚBLICO CUMPRIMENTO REGRAS DE CONDOMÍNIO AMBIENTE AGRADÁVEL BOM ESPAÇO CONDOMINIAL ÁREA DE SERVIÇO MAIOR AMPLA PRAÇA INFANTIL EQUIPADA AMPLO SALÃO DE FESTAS COM CHURRASQUEIRA POUCO BARULHO EXTERNO ESTACIONAMENTO COBERTO CONDOMÍNIO FECHADO COM MURO CUSTO DO CONDOMÍNIO MAIS BAIXO BOM TAMANHO UH LIMPEZA DO CONDOMÍNIO GUARITA BEM LOCALIZADA 24H AUSÊNCIA DE RACHADURAS FÁCIL ACESSO A SERVIÇOS MENOR BARULHO DOS VIZINHOS BOA DISTRIBUIÇÃO DOS AMBIENTES FÁCIL ACESSO A COMÉRCIO RAPIDEZ NA PRESTAÇÃO DE SERVIÇOS E MANUTENÇÃO PRESENÇA DE ANTENAS BOA ORGANIZAÇÃO MORADORES BOA QUALIDADE DOS PISOS AUSÊNCIA DE INFILTRAÇÕES PROBLEMA COM INSTALAÇÕES E EQUIPAMENTOS BOM ISOLAMENTO ACÚSTICO SEGURANÇA DO ENTORNO BOA CENTRAL DE ATENDIMENTO FÁCIL ACESSO AO SÍNDICO BOA QUALIDADE DA PINTURA TRANSPARÊNCIA NA PRESTAÇÃO DE CONTAS QUADRA ESPORTIVA PAVIMENTADA PORTA EXTERNA RESISTENTE BOM RELACIONAMENTO AGENTE FINANCIADOR JANELAS COM BLOQUEADOR AUSÊNCIA DE CHEIRO DE ESGOTO BOA INSOLAÇÃO BOA VENTILAÇÃO BOA INTERFONIA PRESENÇA DE QUIOSQUES COM CHURRASQUEIRA IMÓVEL NOVO SEM ENTRADA AUSÊNCIA DE VAZAMENTO COZINHA NÃO INTEGRADA BANHERIO MAIOR BOA LUMINOSIDADE

39 Perspective of other stakeholders Satisfaction factors may be weighed by stakeholders or specialists RANKING DOS FATORES MAIS IMPORTANTES PARA OS ARRENDATÁRIOS Satisfaction factors are weight by critical points AVALIAÇÃO DA IMPORTÂNCIA DOS FATORES PARA OS ARRENDATÁRIOS AVALIAÇÃO DA IMPORTÂNCIA DOS FATORES PARA A ESTRATÉGIA DA EMPRESA COMPARAÇÃO DOS FATORES DO PAR COM OUTROS EHIS ARRENDATÁRIOS ESTRATÉGIA PAR/EHIS FATORES DE NÍVEL SECUNDÁRIO ARRENDATÁRIOS SÍNDICOS TÉCNICOS TÉCNICOS PROFISSIONAIS SOCIAIS CAIXA CONSTRUTORAS LUGAR AGRADÁVEL 1 1,5 1,5 1,0 0,5 1,0 BAIXA PRESTAÇÃO 2 2,0 2,0 2,0 2,0 0,5 BOM RELACIONAMENTO COM VIZINHANÇA 3 2,0 2,0 1,5 2,0 1,0 FÁCIL ACESSO A TRANSPORTE PÚBLICO 4 2,0 2,0 2,0 1,5 0,5 CUMPRIMENTO REGRAS DE CONDOMÍNIO 5 2,0 2,0 2,0 2,0 1,0 FÁCIL ACESSO A COMÉRCIO E SERVIÇOS 6 2,0 2,0 1,5 2,0 0,5 AMPLA PRAÇA INFANTIL EQUIPADA 7 2,0 1,5 2,0 2,0 0,5 AMPLO SALÃO DE FESTAS COM CHURRASQUEIRA 7 2,0 1,5 2,0 1,5 1,0 BOM ESPAÇO CONDOMINIAL 7 2,0 1,5 1,0 1,0 0,5 ÁREA DE SERVIÇO MAIOR 7 2,0 2,0 1,0 1,5 1,0 ESTACIONAMENTO COBERTO 8 1,5 1,5 0,5 0,5 1,5 POUCO BARULHO EXTERNO 8 2,0 1,5 1,0 1,0 1,0 CONDOMÍNIO FECHADO COM MURO 9 2,0 2,0 0,5 1,5 1,0 CUSTO DO CONDOMÍNIO MAIS BAIXO 9 2,0 2,0 1,5 2,0 1,0 ACADÊMICOS LIMPEZA DO CONDOMÍNIO 10 2,0 1,5 1,5 1,5 1,0 GUARITA BEM LOCALIZADA 24H 11 2,0 1,5 2,0 2,0 0,5 AUSÊNCIA DE RACHADURAS 12 2,0 2,0 1,5 2,0 0,5 MENOR BARULHO DOS VIZINHOS 13 2,0 1,5 1,5 1,5 1,0 BOA DISTRIBUIÇÃO DOS AMBIENTES 14 2,0 1,5 2,0 2,0 1,0 RAPIDEZ NA PRESTAÇÃO DE SERVIÇOS E MANUTENÇÃO 15 2,0 2,0 2,0 1,5 1,0 PRESENÇA DE ANTENAS 16 2,0 1,5 1,0 0,5 2,0 BOA QUALIDADE DOS PISOS 17 2,0 1,5 2,0 1,0 0,5 AUSÊNCIA DE INFILTRAÇÕES 17 2,0 2,0 2,0 2,0 0,5 BOM ISOLAMENTO ACÚSTICO 18 2,0 2,0 1,5 1,0 1,0 SEGURANÇA DO ENTORNO 19 2,0 2,0 1,5 1,5 1,0 BOA QUALIDADE DA PINTURA 20 2,0 1,5 1,5 2,0 0,5 BOA CENTRAL DE ATENDIMENTO 20 2,0 2,0 2,0 2,0 0,5 FÁCIL ACESSO AO SÍNDICO 20 2,0 2,0 2,0 1,5 1,0 QUADRA ESPORTIVA PAVIMENTADA 21 1,5 2,0 1,0 1,5 1,0 PORTA EXTERNA RESISTENTE 21 2,0 1,5 1,5 1,0 0,5 TRANSPARÊNCIA NA PRESTAÇÃO DE CONTAS 21 2,0 2,0 2,0 1,5 0,5 BOM RELACIONAMENTO AGENTE FINANCIADOR 22 2,0 1,5 1,0 1,0 1,0 BOA INSOLAÇÃO 22 2,0 2,0 2,0 2,0 1,0 BOA VENTILAÇÃO 22 2,0 2,0 2,0 2,0 1,0 JANELAS COM BLOQUEADOR 22 1,5 1,0 1,0 1,0 1,5 AUSÊNCIA DE CHEIRO DE ESGOTO 22 2,0 2,0 2,0 1,5 1,0 IMÓVEL NOVO 23 2,0 2,0 1,5 2,0 0,5 PAGAMENTO SEM ENTRADA 23 2,0 2,0 1,5 1,5 0,5 BOA INTERFONIA 23 2,0 1,5 1,0 0,5 1,0 PRESENÇA DE QUIOSQUES 23 2,0 1,5 1,5 1,5 1,0 AUSÊNCIA DE VAZAMENTO 23 2,0 2,0 2,0 1,5 1,0 COZINHA NÃO INTEGRADA 24 1,5 1,5 1,5 1,0 1,0 BANHERIO MAIOR 24 1,5 1,5 1,0 1,0 1,0 BOA LUMINOSIDADE 24 2,0 2,0 2,0 2,0 1,0 LEGENDA SEM IMPORTÂNCIA POUCA IMPORTÃNCIA INDIFERENTE IMPORTANTE MUITO IMPORTANTE

40 PAR Program Evaluation A - Pelotas 132 units B - Pelotas 160 units C - Pelotas 160 units D Porto Alegre 78 units (refurbishment) E/F Canoas 112 units each G Cachoeirinha 360 units H Rio Grande 160 units I Porto Alegre 28 units (refurbishment) Residential Leasing Program (PAR)

41 PAR Evaluation main constructs and product components

42 PAR Evaluation customer profiles Diversity in customer requirements: - Typical clusters in low-cost housing projects Couple with kid(s) Couple without kid(s) 37,80% 21,11% Adult(s) without kid(s) Adult(s) with kid(s) 18,89% 11,11%

43 PAR Evaluation opportunities for improving value Mass customized products with very low variety and flexibility

44 PAR Program opportunities for increasing value Potential for introducing Mass Customization Using client requirements capture opportunities Other effective mechanisms for cost reduction may be used reduction may be used Continuous flow of construction Reduction of production duration Reduction of design approval period (up to 1 year)

45 PIEC evaluation Porto Alegre, Brazil City Entrance Integrated Programme (PIEC) Multiple stakeholders: City government, Community (Participatory budget), Investors, Private sector 10-year programme 3,700 families 5 projects: Housing + community development + income generation + road infrastructure + landscaping

46 PIEC Evaluation main constructs and product components

47 PIEC Program - aims and expected benefits

48 Four interdependent projects CONCEPTION OUTLINE DESIGN DETAIL DESIGN PRODUCTION USE Housing Project CONCEPTION OUTLINE DESIGN DETAIL DESIGN PRODUCTION USE Social Work Project CONCEPTION OUTLINE DESIGN DETAIL DESIGN PRODUCTION USE Road Infrastructure Project CONCEPTION OUTLINE DESIGN DETAIL DESIGN PRODUCTION USE Landscape Project DESIGN PRODUCTION Management and Service Project

49 Stakeholders Mapping Public sector City government Housing Dept. Housing Project Programme management unit Targeted Community (participatory budget) Funding agencies (additional to city Regional Prod., Ind., government) Road inf. Nat. env. adm. Commerce Dept. Dept. FONPLATA 50% centre Dept. Community dev project Road inf. Project Landscape project Income gen Project HBB CONCEPA Private sector Design Companies Construction Comp. Other social programmes Local industries Consultancy Social Assistants Partnerships handcraft training Non gov. institutions External agencies Influencing implementation e.g. lightening company, INFRAERO

50 Programme Evaluation Elections Programme Process Map Elections Government change Feasibility study & Planning Design Construction Use mngmt

51 Analysis of Programme progress Progress of planned activities:

52 Example of value hierarchy: enabling the engagement of the stakeholders Solidarity Credit Program

53 Mass customisation Ability to develop high value added products within short time frames and at relatively low costs Widely used in manufacturing for competitive advantage Design Production Marketing and sales Use

54 Mass customisation Ability to develop high value added products within short time frames and at relatively low costs Used in the house building industry in some countries (e.g. Japan), but rarely for low cost housing

55 Mass customisation Product design Production system + Variety - Cost - Time Supply chain configuration

56 Aim of the research Identify opportunities and barriers for introducing a mass customisation strategy in the Brazilian low-cost housing market: PAR 3 to 5 minimum salaries Identical units Leasers are not allowed to make changes Between 160 and 400 units All units delivered at the end CCA 6 to 18 minimum salaries Small variety (typically two house types) Buyers are allowed to do some changes Between 60 and 160 units Delivered in 3 or 4 batches

57 Barriers and Opportunities to Adopt MC CURRENT SCENARIO DESIRED SCENARIO BARRIERS OPPORTUNITIES External factors Local authorities Long/difficult process to approve housing plan Repetitive projects Increase commonality of design solutions to simplify approval Financial institution Original designs have to be followed Finishing material have to be delivered Openness to negotiation Offer customization service Negotiate changes based on clients requirements Partnership with key suppliers Economical issues High land costs (restrict amount of space) Other aspects are customised at the initial design Design to allow costumers to make changes throughout product's life

58 Barriers and Opportunities to Adopt MC Internal factors Product strategy Product design CURRENT SCENARIO BARRIERS Reactive strategy to unsatisfied costumers Products are difficult to be customised Integral architecture List of possible changes is not followed OPPORTUNITIES Customization is seen as a way to increase market share Willingness to improve customization process Supporting system to capture clients requirements Use of predefined design solutions DESIRED SCENARIO Customization should be a competitive advantage (proactive) Develop products that are easy to produce and customise Capture and manage value with efficiency Modular architecture would facilitate product customization Standard range of options, design as a service to support customization

59 Barriers and Opportunities to Adopt MC Internal factors Production system Supply chain CURRENT SCENARIO BARRIERS Time to request changes is not followed Lack of information from sales department OPPORTUNITIES Willingness to improve communication among teams DESIRED SCENARIO Right moment to customise should be known in advance, transparency Effective information supporting customization process, transparency Large batch size Sequential production Batch sizes to close match demand Mass production core ideas (customization is not considered in the process) Designed to mass production Large batches of finishing materials Willingness to improve production and customization processes Close relationship Close relationship with suppliers Flexible and agile production system to cope with customisation Designed to add value (decoupling point) Involve suppliers to increase options and reduce batch sizes Outsourced services Fixed suppliers Flexible workforce

60 Conclusions Need to consolidate the view of projects as value creation processes Theoretical developments Prescriptive research: tolls, methods, approaches Prescriptive research: tolls, methods, approaches for implementation Social housing present many opportunities for improving value Mass production concepts tend to be adopted How to take advantage of the economic situation to introduce innovations in project management?

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