The concept of value engineering isn’t new — it first came about during World War II — yet today you may hear it being used in reference to commercial construction projects. What does it mean? Value engineering references an approach to projects that is meant to reduce cost without compromising overall project goals and quality of the end product. In commercial construction, value engineering is often most valuable when employed early in the project to maximize return on the effort. But it can be used every step of the way, from planning to design and construction.
Value engineering: a quest to increase value
How does value engineering work?
For developers, value engineering makes a bold promise: to increase value. Value is calculated by function divided by cost — so by maximizing function and reducing cost, developers realize the greatest value.
Typically, during the design phase of a commercial construction project, a value engineering roundtable discussion(s) is held. The roundtable discussion(s) includes key players on the project team, including design team members as well as the contractor’s project estimator and project manager, who use that time to review the project details. They then analyze the function of the facility, gauge how the developer or owner defines value, pinpoint key criteria for the project and research and provide alternative solutions for the project.
The value engineering process usually includes these phases:
Information gathering. During this time period, the project team pulls together details about the project, including the developer/owner’s goals and value definition.
Speculation. During this phase, the project team gathers data and brainstorms methods for reducing cost while preserving function.
Evaluation. At this point the team examines the results of the brainstorming work and determines which will transition to the final solution.
Development. As the ideas are whittled down to those deemed most effective and appropriate to the commercial construction project, the team further develops a list of recommendations with a list of the pros and cons for each along with associated costs.
Presentation. The team then presents their recommendations to the project stakeholders who make a decision about which value management initiatives will be put into practice.
While value engineering initially came on the scene as a way to save costs, it has now morphed into a valued commercial construction project management tactic. The benefits can even include longer-term value such as the efficiency of utilities, eco-consciousness or improved community safety and wellness. Again, the definition of value is determined by the developer or project owner, so much depends on their initial input.
Value engineering: maximizing value as you define it
At DBS Group, we’re always looking for ways to customize solutions to maximize value for our customers, whether through a formal value engineering process or simply by listening to our clients. As a design-build team, we see your project through from start to finish, ensuring the entire team has a shared vision and works toward a common goal. The result: change orders are virtually eliminated and costs are controlled, while you get to fulfill the vision you had all along.
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