Lean Design Management in Aker Solutions Concept Studies: Set-Based Design, Last Responsible Moment, Target Value Design, and Choosing by Advantages
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The design phase in engineering projects is a complex process that involves thousands of decisions, sometimes over an extended period of time, with numerous interdependencies, and under a highly uncertain environment. Traditional design approaches are criticized for being inefficient and wasteful. Several researchers have indicated that planning and control, so essential in the design phase, are substituted by chaos and improvising in the current design approach. An alternative approach is Lean Design, which introduces a way of reducing waste and uncertainty, while maximizing value in the design phase.Lean Design is an extension of Lean thinking, and the principles of Lean are modified in Lean Design to accommodate the nature of the design process. Lean Design offers advantages over more traditional design approaches, and contains several methods and techniques in order to help generate value and reduce waste. This includes posing alternative design solutions as sets rather than as point solutions, deferring decisions until the Last Responsible Moment, making decisions based on the importance of advantages, and designing to meet a Target Value. This study evaluates the current design approach taken by personnel at Aker Solutions when conducting ?concept? studies, and investigates whether methods drawn from Lean Design, such as Set-Based Design (SBD), Last Responsible Moment (LRM), Target Value Design (TVD) and Choosing By Advantages (CBA) might help improve the study conducting process.The research reveals that the current study conducting process at Aker tends more toward traditional approaches with regard to design, decision-making and cost management. Traditional design approach, also known as Point-Based Design, tends to quickly converge on a solution, a point in the solution space, and then modifies that solution until it meets the design objectives. By contrast, Set-Based Design (SBD) begins by broadly considering sets of possible solutions in parallel and gradually narrowing the set of possibilities to converge on a final solution. While Point-Based Design has continuously emphasized making decisions as early as possible, Set-Based Design emphasizes delaying decisions until the Last Responsible Moment. Traditional decision-making methods base their decisions on specific factors and criteria, and then weigh these factors and criteria to make the final decisions. These methods are characterized for being ?unsound methods that cause critical mistakes and cause conflicts? (Suhr 2009). By contrast, Choosing By Advantages (CBA) is a decision-making system that supports sound decision-making by utilizing comparisons among advantages of alternatives, while providing a transparent and collaborative environment to make decisions (Arroyo, Tommelein and Ballard 2013)Traditional cost management is sequential in nature; first design, then estimate. In many projects using this approach, the project scope has to be altered to meet the project?s budget. This cycle of design-estimate-rework results in non-value adding design iterations, referred to as ?negative iterations? (Ballard 2009b). On the contrary, the application of ?design to Target Cost? in Target Value Design acts in reverse. In this approach, cost and other criteria such as time, quality, etc. valued by the customer are the main drivers, and thus, dictate the design. The current design approach used in Aker Solutions when conducting concept studies faces several challenges. This includes non-value adding time spent by design participants waiting for each other, rework, and fluctuating quality of the studies submitted to Statoil (customer). The current approach also faces several coordination, interaction, and communication challenges between those involved. Finally, Statoil?s core values of receiving high quality studies, promptly, and to an acceptable cost are not always met. Based on the existing challenges in the current design approach and the benefits promoted by Lean Design, the report suggests that applying some of the Lean Design methods discussed to Aker?s design approach will improve the process of conducting concept studies. Aker should consider applying SBD if a study follows a complex, tightly coupled completion process. This will help provide Aker with a framework to facilitate parallel development, improve communication, and promote individual and organizational learning to a much higher degree than PBD. This will also enable design participants to know the possibilities before committing and search for global optimal solutions that work for the whole team. Aker will also gain from delaying decision-making until the Last Responsible Moment and basing their decisions on ?sound? decision-making methods, such as CBA. The Tabular Method in this system is suggested as a possible alternative. Delaying decisions until the LRM will help with sharing of information and knowledge before the design is frozen, and avoids placing designers and engineers in a difficult position, having to make high leverage decisions with very little knowledge. In addition, LRM will help examine several alternatives in parallel, before selecting a final alternative, and is therefore a useful tool to combine with SBD. CBA will provide the design team with a simple and systematic way of making decisions and choosing between alternatives. It will also help the team base their decisions on the importance of the differences between the alternatives, instead of factors, criteria, or pros and cons. Using CBA, the team will be able to decide based on what is really important for the customer (Statoil). CBA will also help Aker to anchor their decision to relevant facts, and allow the team to consider trade-offs in order to base their decisions on global benefits. Finally, the report suggests that applying TVD and ?design to target? will help the design team obtain a better-defined target that they can collaboratively work towards in order to ensure the delivery of true value to the customer. This will also help Aker secure more execution projects, and give it a competitive advantage against its competitors. The various methods discussed are linked and related to each other in a complementary way, and the report recommend combining these methods in order to achieve a better design approach. Lean Project Delivery System (LPDS) can provide a framework to combine these methods.