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Transcript of Course 300-cba
*Introduction to Choosing By Advantages
Katherine Blume, PE Southland Industries
Lean Construction [email protected]
19 October 2012
A decision making system for yielding sound, reliable, transparentgrounded choices.
- Jim Suhr- http://www.decisioninnovations.com/
* Choosing By Advantages (CBA)
* CBA - Purpose & Description
*A methodology for transparent decision making that consider
all factors, especially subjective and non-monetary
*Methods Decisions Actions Outcomes
*If the outcome matters, then the method matters
*CBA uses very specific language to ensure all discussion are
consistent.
* CBA - Application
*Strategic Planning
*Selection of subcontractor or vendors on a project
*Selecting personnel in an organization
*Value Engineering
*Selecting equipment for a project
*System selection on projects
* CBA - Principles
*Decisions must be anchored to the relevant facts
*Stakeholders contribute relevant subjective data
*Decisions must be based upon stakeholder values
*Decisions must be based on the importance of
advantages
* Building a Bridge
Question:What is the most important consideration in a new bridge to span the canyon? Aesthetics Economics Safety Speed of Construction
Answer: This question cannot be answered. Items above are factors, unrelated & unanchored. They are not Advantages, so they cannot be compared.
*
Alternative – Two or more mutually exclusive people, things, or plans from which one is to be chosen
EX: Choose site location for new office building
Factor – Element for comparison of Alternatives
EX: Proximity to freeways, proximity to airport, city zoning requirements, address
Usually many factors to consider, chosen by Stakeholders
Cannot compare or rank factors – unrelated to each other, no anchoring
Cost is not treated as a factor, but will be addressed in the last step in the CBA process.
* CBA – Buying a New Car – 1Alternatives & Evaluation Factors
Factors
New Car Alternatives
A B C
1. Passengers
2. Interior
3. Hwy MPG
4. Airbags
*
Anchoring – All decisions, attributes, questions, & importance must be based on (anchored to) relevant factual data.
Acquire correct data
Organize the data correctly
Use the data correctly
*
Criteria – Must or Want conditions of a FactorEX: Want easy access to freeway, must be
located in San Jose, must be walking distance to BART station
Attribute – Character, quantity, or quality of one alternative
EX: Within 1 mile of 280, 5 minute walk to BART
*
Factors
New Car Alternatives
A B C1.
Passengers
2. Interior
3. Hwy MPG
4. Airbags
Criteria: 1 - Want min. 6 passenger capacity 2 - Want fancy interior
3 - Must have min. 28 MPG 4 – Must have min. 4 airbags
*
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
C: Min. 6
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
C: Fancy
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
C: Min. 28
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
C: Min. 4
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
C: Min. 6
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
C: Fancy
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
C: Min. 28
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
C: Min. 4
*
*Advantage – Difference between Attributes of two Alternatives OR benefit, gain, improvement, or bettermentEX: Quieter, more quiet, quietestComparative words (‐‐er or ‐‐est) OR with/withoutIf Advantages are equal, they are not a basis for a decision.An Advantage = a disadvantageAdvantage of one Attribute is disadvantage of another Double counting creates error, unsound choices
Advantages → posi ve processDisadvantages → nega ve process
*
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger +3 passengers
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing Appealing
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg +2 mpg
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger +3 passengers
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing Appealing
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg +2 mpg
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags
*
*
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger +3 passengers
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing Appealing
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg +2 mpg
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags
* CBA Vocabulary
Alternative
Two or more people, things, or plans from which one is to be chosen
Factor (subjective)
Element for comparison of AlternativesCriteria (subjective)
Must or Want condition of a Factor
* CBA Vocabulary
Attribute (objective)Character, quantity, or quality of one alternative
Least Preferred Attribute (subjective)Stakeholder choice for each Factor
Advantage (objective)Difference between Attributes of two Alternatives
OR benefit, gain, improvement, or betterment
AnchoringAll decisions, attributes, questions, & importance
must be based on (anchored to) relevant factual data.
* Importance – Stakeholders’ subjective
comparison of Advantages across all Alternatives & Factors No score for least preferred Advantages for each
Factor Identify one most preferred Advantage for each
Factor Maximum value for one “Paramount Advantage” Importance of the remaining Advantages is ranked
in comparison to the Paramount Advantage
Total Importance Sum of Importance ratings for one Alternative Arithmetic is an objective process
* CBA – Buying a New Car – 8Paramount Advantage Importance
(Subjective
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger +3 passengers
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing Appealing
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg +2 mpg
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags 100
* CBA – Buying a New Car – 9Importance of Advantages (Subjective
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger 30 +3 passengers 40
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing 40 Appealing 30
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg 70 +2 mpg 50
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags 100
Criteria: 1 - Want min. 6 passenger capacity 2 - Want fancy interior
3 - Must have min. 28 MPG 4 – Must have min. 4 airbags
* CBA – Buying a New Car – 10Total Importance (Objective)
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger +3 passengers
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing Appealing
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg +2 mpg
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags 100
160
* CBA – Buying a New Car – 11Cost Data
Factors
New Car Alternatives
A B C1.
PassengersAttributes: 4 passengers 5 passengers 7 passengers
Advantage: +1 passenger 30 +3 passengers 40
2. InteriorAttributes:
Leather seats, wood trim
Leather seats, vinyl trim Vinyl seats & trim
Advantage: More appealing 40 Appealing 30
3. Hwy MPGAttributes: 32 mpg 26 mpg 28 mpg
Advantage: +6 mpg 70 +2 mpg 50
4. AirbagsAttributes: 4 airbags 6 airbags 4 airbags
Advantage: +2 airbags 100
Total Importance 110 160 90
Cost $20,000 $25,000 $30,000
* Not CBA - Weight, Rate, CalculateUnanchored Judgments → Unsound Decisions
Weighted Ranks &
Review Scores are unrelated & unanchored
*CBA Steps1. Identify the alternatives.
2. Identify the factors & assign want or need criteria to each factor.
3. Identify the attributes for each alternative & factor.
4. Identify the least desirable attribute for each factor.
5. Determine the advantage of the remaining attributes over the least desirable.
6. Identify the paramount advantage.
7. Rank the remaining advantages .
8. Compare alternatives based upon their advantages.
*CBA Recap Sound outcomes require sound decision making
methods
Methods → Decisions → Ac ons → Outcome
Decision makers must learn & use sound methods
Decisions must be anchored to relevant factual data
Specific Vocabulary: Alternative, Factor, Criteria, Attribute, Advantage, Anchoring, Importance
Decisions must be based on the importance of advantages
Choosing By Advantages Study of: Heating Hot Water SystemAlternative 1 Alternative 2
Central Plant Heating Hot Water System
Distributed Heating Hot Water
Factor:
Criteria: AttributeAdvantage
Factor:Criteria: Attribute
Advantage
Factor: Criteria: Attribute
Advantage
Factor:
Criteria: AttributeAdvantage
Factor:
Criteria: AttributeAdvantage
Factor:
Criteria: AttributeAdvantage
Total Importance 0 0Capital Cost
Choosing By Advantages Study of: Heating Hot Water SystemAlternative 1 Alternative 2
Central Plant Heating Hot Water System
Distributed Heating Hot Water
Factor: Square feet of Mechanical Space Required
Criteria: AttributeAdvantage
Factor: Access for MaintenanceCriteria: Attribute
Advantage
Factor: Quantity of Boilers & StandbyCriteria: Attribute
Advantage
Factor: Ability to do Boiler Stack Heat Recovery
Criteria: AttributeAdvantage
Factor: Pumping Energy
Criteria: AttributeAdvantage
Factor: Construction Schedule
Criteria: AttributeAdvantage
Total Importance 0 0Capital Cost
Choosing By Advantages Study of: Heating Hot Water SystemAlternative 1 Alternative 2
Central Plant Heating Hot Water System
Distributed Heating Hot Water
Factor: Square feet of Mechanical Space Required
Criteria: Attribute 3200 square feet5100 sq ft required/17
roomsAdvantage
Factor: Access for MaintenanceCriteria: Attribute Outside secure perimeter Inside secure perimeter
Advantage
Factor: Quantity of Boilers & StandbyCriteria: Attribute 3 duty plus 1 standby 20 duty +7 Standby
Advantage
Factor: Ability to do Boiler Stack Heat Recovery
Criteria: Attribute10% increase in boiler
efficeincy Not requiredAdvantage
Factor: Pumping Energy
Criteria: AttributeMore required due to long distribution runs
Less required due to shorter piping runs
Advantage
Factor: Construction Schedule
Criteria: AttributeLonger due to site
distributionShorter - no site distribution
requiredAdvantage
Total Importance 0 0Capital Cost
Choosing By Advantages Study of: Heating Hot Water SystemAlternative 1 Alternative 2
Central Plant Heating Hot Water System
Distributed Heating Hot Water
Factor: Square feet of Mechanical Space Required
Criteria: Attribute 3200 square feet5100 sq ft required/17
roomsAdvantage 1300 Sq Ft.
Factor: Access for MaintenanceCriteria: Attribute Outside secure perimeter Inside secure perimeter
Advantage Outside rather than in
Factor: Quantity of Boilers & StandbyCriteria: Attribute 3 duty plus 1 standby 20 duty +7 Standby
Advantage Less total boilers
Factor: Ability to do Boiler Stack Heat Recovery
Criteria: Attribute10% increase in boiler
efficeincy Not requiredAdvantage Reduction X therms
Factor: Pumping Energy
Criteria: AttributeMore required due to long distribution runs
Less required due to shorter piping runs
Advantage 500,000 KwH per year
Factor: Construction Schedule
Criteria: AttributeLonger due to site
distributionShorter - no site distribution
requiredAdvantage 2 weeks
Total Importance 0 0Capital Cost
Choosing By Advantages Study of: Heating Hot Water SystemAlternative 1 Alternative 2
Central Plant Heating Hot Water System
Distributed Heating Hot Water
Factor: Square feet of Mechanical Space Required
Criteria: Attribute 3200 square feet5100 sq ft required/17
roomsAdvantage 1300 Sq Ft. 2
Factor: Access for MaintenanceCriteria: Attribute Outside secure perimeter Inside secure perimeter
Advantage Outside rather than in 4
Factor: Quantity of Boilers & StandbyCriteria: Attribute 3 duty plus 1 standby 20 duty +7 Standby
Advantage Less total boilers 5
Factor: Ability to do Boiler Stack Heat Recovery
Criteria: Attribute10% increase in boiler
efficeincy Not requiredAdvantage Reduction X therms 8
Factor: Pumping Energy
Criteria: AttributeMore required due to long distribution runs
Less required due to shorter piping runs
Advantage 500,000 KwH per year 10
Factor: Construction Schedule
Criteria: AttributeLonger due to site
distributionShorter - no site distribution
requiredAdvantage 2 weeks 1
Total Importance 19 11Capital Cost
*
Factors
Alternative Apples
MacIntosh Granny Smith Fuji
1. TartnessCriteria: W-low
Attributes:
Advantage:
2. SweetnessCriteria: W-med
Attributes:
Advantage:
3. CrispnessCriteria: M-high
Attributes:
Advantage:
Total Importance
* CBA Exercise 2Vacations
You will receive free airfare and hotel at one of the following locations:
New York City Orlando, Florida Napa, California Yellowstone National Park
Choose a location.1. As a team decide who the stakeholders are2. Identify at least 4 factors and provide attributes for
each factor.3. Identify the advantages and use them to determine
the location of your vacation!4. Be creative and have fun with this!