Importance of Value Engineering in Construction Projects.

Value engineering is a systematic structured and analytical method to reduce the Value of the project/item by providing all necessary functions at the lowest cost, ensuring with required levels of quality, reliability and performance of a product/service/items of a project. Value engineering is a combination of technical and economic management technique which leads to improves the function and reduce the cost.

Major reasons for choosing Value Engineering are to achieve cost saving, make a clear project objective and provide creative thinking for design improvement as Innovations. The crucial cause of concern in Value engineering process are as follows

• Time saving
• Cost reduction.
•  Innovations, Benefits & Efficiency
• Quality & Reliability

In the complete life cycle of the project, the value engineering shall be a formal activity which can propose by the Contractor or Consultants in the important variations or to avoid difficulties in executions or innovations ideas that leads cost savings wherein functionality remain same or upgraded. If the proposal is accepted by the Client or Owner or Consultant, the overall cost savings to be shared both owner and contractor. This must be included in the contract agreement so that contractor may encourage to develop, prepare and submit value engineering change proposals.

While processing a Value Engineering in construction projects, the blow mentioned items must be consider

• Availability of materials
•  Construction methods
• Transportation issues
•  Site limitations or restrictions
• Planning and organization
•  Costs & Profits
• Reduction of environmental impacts

 The task involved in the Value engineering process are as follows.

•   Identifying the main elements of a product, service or project which can be apply the Value engineering.
• Analyzing the functions &  Importance  of those elements in the actual needs of the project.
• Developing alternative solutions for delivering those functions.
• Presenting the proposals to the Client or Owner or Consultant
•  Assessing &Evaluating the alternative solutions with all the Concerns teams.
•  Approving or Accepting the concept proposal and Ensuring that it is innovative solutions.  
• Creating a matrix which involves Value analysis, Engineering Value and Management Value  
• Allocating costs to the alternative solutions.
• Developing more details of the alternatives
• Analyzing the Cost and profits
• Agreeing with all the parties for the profit shares
• Executing the works as per the new proposals, Testing the Functionality and Ensuring the Efficiency.
•  Delivery of the Activities/Products/Projects to the Client or Owner  

Application of Value Engineering in different Phases of the Construction Projects and Advantages.

• Engineering & Design Phase

The Value Engineering in Design & Engineering phase of a Project will offer the great opportunity for cost saving. During this phase the Contractor or Consultant can use the latest technologies & trends in the market, either by use of intelligence base digital designs such as Building Information Modeling (BIM) technology, Virtual Design and Construction (VDC), Computer aided Designs (CAD) technology (2D, 3D & Revit etc), Layouts etc.  these Digital Engineering Analysis will provide the support to the Economical study leads to the cost saving in the preliminary stage of the project.   And based on the type of projects the Cost saving can be shared to all the parties. Like for Design Bid & Construction projects Majority shares to be taken by the client (if it is derived prior to the Bid). And for Engineering procurement & construction projects the profits should be shared mutually.

• Materials & Procurement Phase
• Erection or Construction Phase
• Commissioning and Operational Phase