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Volume-6, Issue-1, January-February-2016

International Journal of Engineering and Management Research
Page Number: 25-29

Application of Value Engineering in Construction Projects

Prof. Nitin L. Rane 1, Prof. P.M. Attarde 2
1
Professor, Department of Civil Engineering ,J.T.Mahajan, Polytechnic Faizpur, Maharashtra, INDIA
2
Professor, Department of Civil Engineering, SSGB, COE & T, Bhusawal (NMU), Maharashtra, INDIA

ABSTRACT of professional competence and technological excellence

Value Engineering is a proven management in the organization. Value engineering not only aims at
technique that can make valuable contributions to value cost reduction but also cost effectiveness which in turn
enhancement and cost reduction in construction industry. enhances the value and provides competitive advantage.
Value Engineering is one of the most effective techniques Value engineering techniques can be applied wherever cost
known to identify and eliminate unnecessary costs in product
is proposed or likely to be incurred in terms of money,
design, testing, manufacturing, construction, operations,
maintenance, data, procedures and practices. The skills/expertise, energy or other resources. In other words,
methodology is composed of three main stages. The first stage this will cover practically every area of human activity and
is the Pre-Study of the Value Engineering. The purpose of value engineering can be considered applicable to all of
this stage is to plan and organize the value study. Value them. value engineering is applicable to hardware, building
Engineering is the systematic application of recognized or other construction projects and to soft areas, such as
techniques that identify the functions of the product or manufacturing processes, administrative and management
service, creatively establish the worth of those functions, and systems, office procedures, books and forms and computer
provide only the necessary functions to meet the required software costs. In case of once through projects such as
performance at the lowest overall cost. Value Engineering
civil engineering works for example, buildings, highways,
focuses on accomplishing the required functions at the lowest
overall cost. It helps in eliminating or minimizing wastage of water/air/effluent treatment plants, etc and engineering
material, time, and unnecessary cost, which improves value to projects such as product design, greater benefits from the
the customer. The second stage is the Value Study which is application of Value Engineering can be obtained by
the core of Value Engineering study and it is composed of five application of these techniques at the early design stages.
phases, the Information phase, Function Analysis Phase, Adequate data collection in such studies is essential
Creative Phase, Evaluation Phase and the Presentation phase. together with in depth involvement of the agencies dealing
All phases and steps perform sequentially. Such sequence of with the finance, design, construction and use of the
the methodology is expected to assist in logical and systematic project. A project may require several teams to work
flow of the process to achieve the targets of the VE study. The
simultaneously on different aspects such as, structural
third stage is the Post Study. The objective during post-study
activities is to assure the implementation of the approved design, layout, subsystem services, etc
value study change recommendations. In this study, how the Value engineering studies in soft areas are those
principles of Value Engineering are applied in construction which concern manufacturing processes and administrative
projects is explained, and by taking case study on residential procedures. A sequence flow chart of activities and times
building as the sample project, practices of Value using standard industrial engineering techniques is
Engineering in this project are described. essential. Details of material loss, low yield, wastages,
rejection, rework, loss of man/machine hours, etc, together
Keywords— Value Engineering, Functions Analysis, with their costs, are equally essential as part of the data to
Cost, Quality aspects of a project, Value Analysis. be collected during the information phase of the value
engineering study. [1]
Value engineering results in the increased use of
I. INTRODUCTION alternative less expensive material, cheaper design, weight
reduction, new methods of manufacturing, indigenization,
Value engineering is basically a team effort. It etc, to give the same or better performance, quality and
aims at promotion of value awareness and raising the level efficiency at a lower overall cost. In order to produce a

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product or service to be competitive in the open market, development, preliminary design, final design,
the best value is determined by two considerations, procurement and construction.
namely, function and cost of product. Value of a product • Manufactured products, whether consumer,
or service can be enhanced either by increasing the industrial, or defence, may be studied with a
function or decreasing the cost or both while maintaining focus on either the design or manufacturing
the performance quality and reliability. [2] process of that product. A product may be the
subject of a value study at any time during the
II. HISTORICAL BACKGROUND product’s life. A value study can be applied at the
onset of the product development to better
Value Engineering had its origin during World understand the customer’s needs, identify the
War II, at General Electric, when innovation was required functions necessary to satisfy those needs, and
because of material shortages. Some critical materials were develop the initial concept. Throughout the design
difficult to obtain, and a great many of substitutions had to development, value methodology can be used to
be made. Mr. Harry Erlicker, a vice president, made the refine and enhance the concept, based on the
observation that many times these changes resulted in latest facts. Even after a product has been
lower costs and improved products. This encouraged him introduced and is in production, a Value Study
to seek an approach to intentionally improve a products can be used to further enhance the product and
value. He assigned Lawrence D. Miles, a staff engineer in respond to changing customer and economic
1947, the task of finding a more effective way to improve conditions. A value methodology can be used to
a product's value. In 1985, the Value Engineering process either develop new ways to manufacture a
had gained worldwide acceptance. It spawned an product or change an existing process.
international organization, Society of American Value • Business systems and processes may also be the
Engineers International (SAVE Int.), dedicated to its subject of Value Studies. Many elements of a
practice, and the certification of competent practitioners. In business or an organization may be improved
1997, SAVE approved a standard for Value Engineering through the application of a value methodology.
Methodology. [3] This may be from the development of business
Shublaq defines value as the most cost effective way to plans and organizational studies to improving
reliably accomplish a function that meet the user's need, existing business processes.
desires and expectations. He used Dell'Isola, expression for Value methodologies may be applied more than
value as follows: once during the life of the project. Early application of a
value methodology helps to get the project started in the
right direction, and repeated applications help to refine the
Where: project’s direction based on new or changing information.
Function: The specific work that a design or item must The later a Value Study is conducted in project
perform. development, more likely implementation costs will
Quality: The owners or users need, desire and expectation. increase. A value methodology may be applied as a quick
Cost: Life cycle cost (LCC). response study to address a problem or as an integral part
of an overall organizational effort to stimulate innovation
III. APPLICABILITY OF VALUE and improve performance characteristics. Value
ENGINEERING methodologies may be used to enhance an organization’s
quality programs, new product development activities,
Value methodologies can be applied during any manufacturing processes, and architectural and
stage of a projects development cycle, although the engineering design. [4]
greatest benefit and resource savings are typically achieved
early in development during the conceptual stages. At this IV. VALUE ENGINEERING IN
point, the basic information of the project is established, CONSTRUCTION
but major design and development resources have not yet Construction projects are becoming bigger in size
been committed. The reason this is the best time to apply a and scope. Construction companies are pressured to
value methodology is because the manner in which the deliver construction projects at a lower cost while
basic function of the project is performed has not been maintaining performance on design functions. The
established, and alternative ways may be identified and engineers have always tried to reduce the cost of
considered. Examples of these applications are: construction without affecting the quality and the
• Construction projects could benefit by identifying functional utility, however their approach was based
improvements for various project phases: concept mainly on the past experience. Keeping costs low with
traditional methods has been a common practice to

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improve competitiveness. Saving money at the same time,

providing better value is a concept that everyone
emphasizes. Value engineering (VR) is a practice whose
goal is, always, to achieve value for money. With the
advancement of science and technology, it became
comparatively easy to reduce the construction cost, but
the concept of functional utility was not given due
consideration. Reliability and durability were of little
importance. Only in recent past. Engineers and
Architects have started taking Into consideration these
important factors i.e. reliability and durability with
functional utility to optimise the cost. This cost of the
project is named as functional cost, as the ultimate
objective of project planning, construction, management
and control is to have its functional utility with
durability and reliability of its services at the optimum
possible cost. Fig. 1 THE JOB PLAN
This subject has got emphasize in last few
years whose object is to effect economy, in the cost of A. Pre-Study
construction of project. Value engineering (VR) as such is Pre-study tasks involve six areas: Collect
a systematic application of recognised techniques which User/Customer Attitudes, Complete Data File, Determine
identify the function of a product or service; establish a Evaluation Factors, Scope the Study, Build Models,
monetary value for the function and provide the Determine Team Composition. [3]
necessary function reliable at the lowest overall cost. In B. Value Engineering Study
civil engineering it is related to minimum cost of project The VE study is composed of six phases:
or construction work, without affecting the quality. The Information, Function, Creativity, Evaluation,
projects are generally designed by engineers and Development, and Presentation phase.
constructed by contractor. The responsibility of engineer is 1) Information Phase: The objective of the information
to design project in a manner such that it must be phase is to complete the value study data package started
economical in minimum cost and maximum output. The in the pre study work. If not done during the pre study
job of contractor thereafter is to apply his skill to activities, the project sponsor or designer brief the value
construct the project in estimated cost or if possible even study team, providing an opportunity for the team to ask
less than that. [1] questions based on their data research. If a site visit
wherever applicable was not possible during pre-study, it
V. METHODOLOGY should be completed during this phase. [4]
In order to keep this process easy, however, the
The value methodology use the disciplined function of each task must be defined as simply as
procedure for improving value and use procedure called possible, such as using two verb-noun words. [5]
job plan. The job plan outlines specific techniques to 2) Function Analysis Phase: Functional analysis outlines
effectively analyze a product or service in order to develop the basic function of a product using a verb and a noun
the maximum number of alternatives to achieve the such as ‘boil water’ as in the case of our kettle. [6].
products or services required functions. Adherence to the In function Analysis Phase the team performs:
job plan will better assure maximum benefits while Determine the functions, classify the functions, build a
offering greater flexibility. function model, estimate the cost of performing each
The VE job plan covers three major periods of function, determine the best opportunities for
activity: Pre-study, the Value study, and Post-study As improvement, refine study scope. [3]
shown in fig.1. All phases and steps are performed 3) Creative Phase: The Creative Phase develops ideas for
sequentially. As a value study progresses new data and alternative ways to perform each function selected for
information may cause the study team to return to earlier further study. The objective of the creativity phase is to
phases or steps within a phase on an iterative basis. [4] develop a large quantity of ideas for performing each
function selected for study. [7]
This is a creative type of effort, totally
unconstrained by habit, tradition, negative attitudes,
assumed restrictions, and specific criteria. No judgement
or discussion occurs during this activity. [3]

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4) Evaluation Phase: In Evaluation phase alternative ideas subject of value engineering. As a conclusion, the area of
are ranked and rated and ideas for development are value engineering analysis and study will be controlled by
selected.[6] that functions. Further, we can do analysis of these
The objectives of the evaluation phase are to functions and suggest alternatives and calculate cost model
synthesize ideas and concepts generated in the creativity after application of value engineering technique. For
phase and to select feasible ideas for development into getting a better output for value engineering
specific value improvement. Using the evaluation criteria implementation in a residential building the following data
established during the pre-study effort, ideas are sorted and are essential as a information regarding to the project.
rated as to how well they meet those criteria. [3] • Detailed Contract Documents
5) Development Phase: The Development Phase takes the • Detailed Estimation of the items
most feasible alternatives and prepares information such as • Basic building and site data
sketches, narratives and specifications to improve the • Owner’s requirements for preparation of quality
value of the project.[8] model
The data package prepared by the champion of • Activities involved
each of the alternatives provide as much technical, cost, • Current resource price in market
and schedule information as practical so the designer and • Problems involved
project sponsor may make an initial assessment concerning
• Collection and study of drawings
their feasibility for implementation. [4]
6) Presentation Phase: The presentation phase is actually
presenting the best alternatives to those who have the VII. ACKNOWLEDGMENT
authority to implement the proposed solutions that are
acceptable. [6] It is stern guidance and grandeur of him which
Through the presentation and its interactive has brought this work in a proper channel. This guidance
discussions, the team obtains either approval to proceed not only helps me to collect the knowledge but also to gain
with implementation, or direction for additional the confidence which would help me in future. My
information needed. [7] association with him as a student has been extreme
C. Post-Study pleasing. I would like to express my gratitude towards my
The objective during post-study activities is to respected guide Prof. P.M. Attarde. I pay my sincere
assure the implementation of the approved value study thanks to Prof. P.P. Bhangale, HOD of Civil Engineering
change recommendations. Assignments are made either to Department. I would also like to thank Principal Dr. R.P.
individuals within the VE study team, or by management Singh sir for his encouragement and valuable suggestions.
to other individuals, to complete the tasks associated with Finally heartfelt appreciation to the all those who directly
the approved implementation plan. [3] and indirectly helped me in completion of this experiment.

VI. CONCLUSION REFERENCES

It is not possible to apply VE on each project a [1] Dr. S.V. Deodhar,(2010) "Construction Equipment and
company produces. Much more successful value Planning," Khanna Publishers Delhi. Fourth Edition .
engineering studies can be carried out on complex and big [2] K.K. Chitkara,(2011) "Construction Project
projects which have high potential of restoring the Management Planning, Scheduling, and Controlling,"
investment. Of course value engineering works have a Second Edition, Tata McGraw Hill Education Private
cost, therefore this project shall be big enough to meet this Limited New Delhi 2011.
cost and obtain profit. The purpose of value engineering is [3] Value Engineering: A Guidebook of Best Practices and
not just reducing the costs, increasing the design standards, Tools, Department of defence United State of America,
making it easier to build the project and saving time and June 13,2011
money. VE must create a balance between all the needs of [4] Value Standard and Body of Knowledge SAVE
the project. Purpose of VE shall be determined in direction International, The Value Society,USA, June 2007.
of company purposes. Every person that joins for VE shall [5] Boo Young Chung, Syadaruddin Syachrani, Hyung
be embraced. There should be no one in the team who Seok Jeong, and Young Hoon Kwak, (2009) "Applying
thinks in the opposite of project management, or who is Process Simulation Technique to Value Engineering
suspicious in the benefits of VE. Model: A Case Study of Hospital Building Project" IEEE
The highest performance in VE is achieved transactions on engineering management, vol. 56.No.3.
especially when the purpose is mainly increasing the value [6] Amit Sharma, R.M. Belokar, (2012) " Achieving
rather than reducing the costs.The application of Pareto Success through Value Engineering:A Case Study"
Law 20/80 states that around 20 % of the functions
constitute around 80% of the cost. These functions are the

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Proceedings of the World Congress on Engineering and

Computer Science 2012 Vol II, ISSN: 2078-0966
[7] Om Ji Shukla , Anil Kumar Misra, (2013) "Easily &
Economically Feasible Value Analysis &Value
Engineering Concepts for Manufacturing industry"
Engineering Management Reviews (EMR) Volume 2 Issue
3.
[8] Abeer Khalid Mansour, and Mohammed Abueusef,
(2015) " Value Engineering in Developing Countries"
International Conference Data Mining, Civil and
Mechanical Engineering, Bali Indonesia.

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