Target Value Design Process Sample Clauses
The Target Value Design Process clause establishes a structured approach for setting and managing cost targets during the design phase of a project. It typically requires the project team to collaboratively define a target cost for the project or specific components, and then design solutions that meet both functional requirements and budget constraints. This process often involves regular cost estimation, value engineering, and iterative design adjustments to ensure the project remains within the agreed financial parameters. Its core function is to align design decisions with budgetary goals, thereby minimizing the risk of cost overruns and ensuring financial discipline throughout the design process.
Target Value Design Process. The IPD Team, under the direction of the PMT, will use the Target Value Design process to optimize and coordinate the design in accordance with the Base Program and endeavor to create additional value by identifying alternative systems, means, and methods to reduce capital expenditures and life-cycle costs, analyze and improve work-flow, improve constructability and functionality, provide more operational flexibility, and endeavor to reduce the actual Chargeable Costs while maintaining or increasing the quality and overall function of the Project. To the greatest extent practicable, the General Contractor and the relevant IPD Team Members will provide continuous cost projections and rapid cost evaluation of proposed design alternatives to the PITS and PMT throughout the Target Value Design process to assist the IPD Team Members, and the PMT, in making informed decisions about proposed design solutions.
Target Value Design Process. The Parties acknowledge that Target Value Design is intended to make explicit that value, cost, schedule, and constructability (including work structuring) are basic components of the design criteria. The intent is to design the Project to a detailed estimate. The Core Group shall develop written guidelines or protocols for use with Target Value Design principles throughout the design process. At a minimum, these protocols shall address the following:
10.4.1 method to establish initial target costs for major components and systems;
10.4.2 method for determining other value elements of Target Value Design;
10.4.3 schedule for selection of Architect’s Consultants, Subcontractors, Suppliers, Owner’s Consultants and separate contractors during design;
10.4.4 method for forming and meeting structure for cross-functional teams (clusters) of designers and builders for major components and systems of the Site and structures;
10.4.5 method for aligning all IPD Team Members behind the objective that the Target Cost (as adjusted in accordance with this Agreement) not be exceeded without express approval of Owner;
10.4.6 method to assure continuous cost analysis and reporting procedures within the cross- functional teams (clusters) for monitoring estimated costs against target costs;
10.4.7 creation of a target value team comprised of the cross-functional/cluster leaders to meet regularly and frequently, with responsibility for evaluating Target Value Design tradeoffs and opportunities, (including function/cost trade-offs) and authority to direct value engineering and adjustments of the component/system costs up or down to maintain total project target cost; and
10.4.8 the frequency of preparing the milestone roll-up estimates described in Section 10.3.
Target Value Design Process. The PMT and PITS will utilize the Target Value Design process to optimize and coordinate the design in accordance with the Owner's Program Objective and endeavor to create additional value by identifying alternative systems, means, and methods to reduce capital expenditures and life-cycle costs, analyze and improve work-flow, improve constructability and functionality, provide more operational flexibility, and endeavor to reduce the actual Chargeable Costs while maintaining or increasing the quality and overall function of the Project.
(a) The agreed Target Cost is a design criteria.
(b) To the greatest extent practicable, the Contractor and its subcontractors will provide continuous cost projections and rapid cost evaluation of proposed design alternatives to the PITS and PMT throughout the Target Value Design process to assist the Risk/Reward Team Members, and the PMT, in making informed decisions about proposed design solutions.
Target Value Design Process. The Parties acknowledge that value, cost, schedule, and constructability (including work structuring) are basic components of the design criteria. The intent is to design the Project so it may be completed within the Owner’s Program for less than the approved Expected Cost. Target Value Design begins upon conclusion of the Validation Phase and continues through the completion of design.