The Value of Value Engineering

The objective of value engineering is straightforward – reduce costs while improving function and quality. Or put more colloquially – having your cake and eating it too. But achieving value engineering is a bit more nuanced, and challenging.

In our role as Construction Manager, value engineering often involves determining the availability of materials and identifying opportunities for improvement in a wide range of areas, including construction methods, transportation issues, site limitations or restrictions, planning and organisation, and costs.

To create the greatest benefit, value engineering should start at the beginning of a project. However, that doesn’t mean that it can’t occur at every stage of a project, so long as the proposed changes do not adversely affect the schedule or drive additional costs that outweigh potential life-cycle savings.

Value engineering should be a collaborative effort, and involve the entire team.

An important part of the value engineering planning process is the project review, which is conducted by our team during the design phase.

During the project review, the team reviews the proposed project, performs a functional analysis of the facility, obtains the client’s definition of value, determines key criteria for the project, and offers innovative construction solutions. During this process, our team works hard to understand the objectives of the project – considering all stakeholders.

Though every construction firm will have different steps it follows to deliver value engineering, we’ve found the following stages to be essential to delivering the level of innovation and cost savings modern construction demands.

Information: During the review, the project team seeks to gather information about the project thus far, including important objectives, key criteria, and the client’s definition of value. It’s at this stage that AFC Construction develops a detailed understanding of our client’s objectives and end-user requirements, from both a community and organizational perspective.

Speculation: Our management team studies the drawings, brainstorming possible ways to reduce construction and overall lifecycle cost while still providing maximum facility functionality.

Evaluation: The team evaluates the ideas produced during brainstorming. The best ideas are brought forward and progress through development and presentation stages.

Development: Promising ideas are shared with the consultants to flush out the details and ensure they will meet project requirements. AFC Construction will price the proposed change. Often ideas for value engineering are driven by constraints. For example, the bid/estimate is higher than expected and the costs need to come down before the project can commence.

Presentation: A final written report is created, presenting all proposed ideas to the owner, user group, and designer. At this stage, the client determines which ideas to incorporate into the design – those that deliver the greatest value at a cost that respects the overall budget.

Value engineering is frequently required though all phases of a project. When a design or construction challenge materializes, value engineering options are developed and provided alongside updated project budgets. Once an idea is evaluated, we advise project stakeholders so any initial concerns can be vetted before options are formalized and implemented.

As part of our process, partners and senior managers are also included in the value engineering review. This approach allows us to provide maximum input into design concepts and leverage over 100 years of combined experience on every project.