When approximating costs, there is a common misunderstanding of the value engineering process. To some, value engineering is similar to scope reduction and cost/budget-cutting. True Value Engineering begins in the earliest phases of building design. The process involves teamwork between the proprietor, the contractor and the design team. While refining quality and function without compromising the structure’s intent, it helps to confiscate unwanted expenses.
A Brief History
Value engineering began during World War II at General Electric as a solution to a shortage of skilled workforce, lack of constituent parts and resources. GE’s Harry Ehrlicher and Lawrence Miles had to seek alternatives as a solution. While some alternatives cut on costs, they resulted in a refined end product. Both Harry and Miles instituted the value analysis technique.
What is True Value Engineering?
As stated by NIBS, it refers to an informed and clear set of well-organized processes designed to look for ideal value for both primary and long-term investment. Thus, it’s having careful thought to available options while keeping in mind the objectives of the project.
Therefore, while cost-reduction is inevitable, there are other aspects such as client-desired quality that must be inclusive in the value equation.
Commercial buildings construction experts understand the significance of value engineering in upholding the project’s budget. Traditionally, value engineering has been focused on cost-reduction. As a result, as many general contractors would approve, this frequently results in the loss of the inclusive project value.
Today, architects and contractors specialized in commercial buildings such as healthcare projects, have verified the importance of value engineering. They confirm that nearly all healthcare projects embrace the process as a standard value.
With a well-organized and well-implemented value engineering process, you can improve a project without forgoing its integrity. When applying this process to commercial buildings construction, the owner’s established criteria and standards must be used during analysis.
Thus, here is how value engineering works:
An element that exploits performance with a lesser cost is of better value than the aspect of reduced performance with a similar cost. So, the projected drive of value engineering is to improve the value attained by the proprietor funding a constructed project.
Take, for instance, VJ Technology. In some cases, they’ve been able to evaluate a strategy and offer the customer a solution using quality fixing. Because of their performance, then fewer are needed. Independently, the high-performance components are costly. But when you factor in the fewer components required and the related time savings, it works out much-improved value. That means an improved performance at a lesser cost.
The dangers of not involving value engineering in the starting phase are many. When lots of funds are used in trying to modify the deficiencies, there is one significant thing that is lost – value. No matter how much efforts are invested in leaving no stones unturned, the end product’s value is downgraded.
How Do You Achieve True Value Engineering?
An investigation done by skilled, multi-disciplinary teams showed how both the proprietor’s preferences and value could be attained. First, you can disregard or amend elements dispensable to compulsory functions. Second, you can improve the basics that accomplish mandatory tasks that have not yet been achieved. Lastly, you can modify the basics to enhance value or performance to achieve anticipated levels established by the proprietor.
When value engineering is implemented, it should be able to find the optimal functional balance between client requirements, building costs, and life-cycle outlays. Through this, the process should give savings in:
- Primary capital building costs, without harm to operational expenses and conservation and revenue.
- Projected indirect costs, for instance, facility recruitment, operations, and upkeep.
