Engineering (VE) Process
Federal, State and local highway agencies are responsible for getting
the best overall project value for the taxpayer. Applying the VE process
to suitable projects will help you achieve this purpose. Simply stated, VE
is an organized application of common sense and technical knowledge
directed at finding and eliminating unnecessary costs in a project.
The most frequently heard first response to a presentation on VE is
"we do it all the time, but we don't use that name!" However, it is
highly unlikely that you do it all of the time. Value Engineering has many
elements, such as, team work, functional analysis, creativity, cost-worth,
and the systematic application of a recognized technique. Unless all of
these elements are used, it isn't VE and it will not yield the results
that a VE study will yield.
Value engineering studies are guided by a specific job plan. This is a
blueprint, if you will, of how the study will proceed. The VE job plan
which we use in the Federal Highway Administration has the following eight
- Selection: Project selection is outside the control of the
value study team. In general, the criteria used to select projects
- high cost projects,
- projects which "are just not worth the expenditure necessary to
- important, but low priority projects that fail to meet the budget
- and problem projects.
- Investigation: The Investigation Phase is where the value
study team first becomes involved. In this phase, the team determines
what they know about the project from readily available information and
what they must know in order to really define and / or solve the
problem. It is in this phase of the VE study that we identify the
elements that have the greatest potential for value improvement.
The Investigation Phase immediately brings the three fundamental
concepts of VE (function, cost, and worth) to bear on the problem. It is
these concepts that make the VE process different from all other
management and cost control techniques. This phase requires the team to
ask and answer the following basic questions:
- What is it?
- What does it do? (what is the function?)
- What must it do? (is its function basic?)
- What is it worth?
- What does it cost?
Most of the information required in this phase is readily available.
The length of the project, its cost estimate, traffic projections,
design speeds, and the major elements designed into the project can be
easily identified from a review of the plans and other documentation.
Sometimes the VE team must dig harder for other information to
adequately complete the investigation phase.
Applying Pareto's Law of Distribution will give you an idea of where
to start looking for potential savings. It states that 80% of a
project's cost will be in 20% of the work. Preparing a project cost
model will begin to identify your targets of opportunity.
Identifying the functions your project and its elements
perform is the next step in the Investigation Phase. Function denotes
the specific accomplishment to be achieved by an element or combination
of elements in the overall design. The value methodology requires that
we describe a function by the use of two words - an action verb and a
measurable noun (that is acted upon).
For example, the function of a bridge is to "cross obstacle." The
bridge doesn't care (nor do we) whether that obstacle is a ditch, river,
creek, railroad, another highway or a building. Its basic function is to
provide a means to cross that obstacle. If it does not accomplish that
function, we wouldn't buy it, therefore the cross obstacle function is
basic. We want to be as non-specific as possible to leave us many
options to perform the generalized problem or function that we have
By the end of the Investigation Phase we have identified our
high-cost elements, functionally analyzed them, and assessed their cost
/ worth relationships. This phase of the VE job plan identifies the
areas of a project that are ripe for further value study.
- Speculation: The Speculation or Creativity Phase is next.
This is where the power of the VE technique manifests itself. The team
applies brainstorming techniques to develop good alternatives to the way
the project is currently designed. Brainstorming forces people to be
creative. The mechanism that produces this phenomena is called
synergism - which means that one idea triggers other ideas or thoughts
through: similarities or like ideas; contiguous or adjoining ideas;
contrasting or opposite ideas; and sound alikes.
The value study team applies creativity to its functional statements
which it has selected from the cost/worth estimates. It uses the generic
format of the function to speculate on all possible solutions to the
problem presented in that functional statement.
The team uses brainstorming to generate a large list of potential
solutions to the problem described by the two-word function and then in
the next phase are able to rapidly pare the universe down to a
manageable few ideas through the feasibility analysis.
- Evaluation: Evaluation of the best alternatives is next. The
advantages and disadvantages of each remaining alternative are listed.
Of course, if the disadvantages far outweigh the advantages of any
alternative, it is dropped at this point.
Each advantage and disadvantage is described in general terms. The
team can perform a weighted matrix analysis to determine which
alternative is best based upon the relative importance of each of the
desirable criteria which must be addressed. This analysis satisfies the
VE objective--to achieve the best blend of performance, cost, and
schedule. The objective is not to gain perfection.
- Development: Once the team selects the best alternative, it
is fully developed through sketches, cost estimates, validation of test
data, and other technical work to determine if any assumptions made
during the study are in fact valid. The final step before presenting the
teams recommendations to management is to formulate an implementation
plan which describes the process that the agency must follow to
implement any recommendations.
The final product of a value study is the formal VE report and the
presentation of the team's recommendations.
- Presentation: In this phase, the VE team must present their
findings to the decision makers and convince them that their ideas
should be implemented.
- Implementation: No recommendation for a savings is a savings
until it has been implemented. The decision makers must take the
appropriate action to insure that the suggestions are accomplished.
- Audits: This phase determines the amount of savings generated
by the Value Engineering study based on the amount of recommendations
implemented in the construction project.
Value Engineering can be applied at any point in the highway
development process, but to obtain maximum effectiveness, VE studies
should be undertaken as early as possible when the impact of decisions
(on life-cycle costs) is the greatest.
A team of 5 to 8 persons with diverse backgrounds seems to work best.
The length of time required for a study varies and is dependent upon the
complexity of the project. It shouldn't take more than a week. We
recommend that the VE team effort be done at one time rather than
spreading it over several weeks or months. By doing this the team
members do not have to become reacquainted with the project and momentum