Frequently Asked Questions

This page provides answers to questions frequently asked about value engineering and value engineering workshops.

What is value engineering?

Do all value engineering analyses result in lower costs?

What is the Federal mandate that requires value engineering?

What happens if the mandate is not satisfied?

Who makes up the members of a value engineering team?

What happens during each step of the value engineering job plan?

Why aren’t all value engineering recommendations implemented?

Where can I find out more information about value engineering?

What is value engineering?

Value engineering is a systematic approach to improving a project, process, or product. This approach uses a sequential process known as a “job plan” that includes phases referred to as pre-study, investigation, speculation, evaluation, development, presentation, and post study. This job plan is usually carried out in a workshop setting using a trained facilitator and a multi-disciplined team.

Do all value engineering analyses result in lower costs?

No, reducing cost is only one objective of a value engineering analysis. To quote from the Federal Highway Administration value engineering web site: “The goal of a VE study is to achieve design excellence. Its objectives are to improve quality, minimize total ownership costs, reduce construction time, make the project easier to construct, insure safe operations, and assure environmental and ecological goals. The VE team is looking for the optimum blend of scheduling, performance, constructability, maintainability, environmental awareness, safety, and cost consciousness.”

What is the Federal mandate that requires value engineering?

The National Highway System (NHS) Designation Act of 1995 requires each state to carry out a VE analysis for all Federal-aid highway funded projects on the NHS with an estimated total cost of $25 million or more. Legislation in later years amended this requirement to apply to non-NHS projects eligible for Federal aid, lowered the threshold to $20 million for bridge projects, and clarified that “total cost” included not only construction costs but also design, right-of-way, and utility adjustment costs.

What happens if the mandate is not satisfied?

Technically, a project that meets or exceeds the cost thresholds in the mandate cannot receive Federal aid if the value engineering analysis has not been completed.

Who makes up the members of a value engineering team?

The team selected for a value engineering analysis should include all the disciplines which are appropriate to the project. The disciplines considered for a typical highway project are likely to include roadway engineers, structural engineers, traffic engineers, and drainage engineers as well as those familiar with construction, maintenance, operations, right-of-way acquisition, utility adjustment, and environmental impact analysis. In addition, representatives from local government, metropolitan planning organizations, and other stakeholders, including the general public, may also be invited to participate.

What happens during each step of the value engineering job plan?
See the box below for a summary of each phase.

Pre-study - Prior to the workshop, the facilitator works with the client to plan the event. This planning includes determining the scope of the workshop, deciding where the workshop will be held, selecting team members, and choosing the starting date and duration of the workshop. The facilitator will also gather data and documents on the project (or arrange for them to be present on the first day of the workshop) and will complete a cost model. This model often highlights “Pareto’s Law of Distribution:” the fact that 20% of the work usually accounts for 80% of the cost. The facilitator uses this model to focus the team’s attention on those parts of the project that have the greatest potential for savings.

Investigation Phase - Some of the individuals on the study team may have an intimate knowledge of the project, others may never have even heard of it, and the remainder fall somewhere in between. Therefore, the primary goal of the Investigation Phase is for the team to develop a detailed and shared understanding of the project, its current design, and how that design functions to meet the project’s purpose and need.

Speculation or Creative Phase - During the Speculation Phase, the team brainstorms each function to generate ideas for improvement. No attempt is made during this phase to restrain the free flow of ideas. Therefore, some ideas may be impractical, “far fetched,” or even nonsensical. This lack of restraint is essential to creative thought. Ideas that are not feasible are eliminated in the next phase of the study.

Evaluation Phase - During the evaluation phase, the team assesses each idea and developed a consensus of which ideas should be retained for further analysis.

Development Phase - In this phase, the ideas retained from the Evaluation Phase are reorganized into prospects for further investigation and development by the team. In some cases, related ideas are combined into a single prospect. During the Development Phase, the team gathers information and prepares a written summary for each of the prospects. The team prepares sketches, performs calculations, and develops cost estimates to support its analysis of each prospect.

Presentation Phase - The workshop concludes with a presentation to key members of the client’s staff.

Post Study - What happens after a value engineering analysis is completed? After the workshop, a draft report is prepared to summarize the workshop and its recommendations. This report is provided to the client for review and editing, after which the final report is prepared. Once the final report is received, it is usually distributed within the client’s organization for review and comment. Copies will also normally be provided to the designer of the project (which could be either personnel on the client’s staff or an outside consultant). After these people have had a chance to review the recommendations, and, in some cases, conduct further analysis and design, the client will convene a meeting to discuss the recommendations and hear any input the designers may have. After that meeting, the client will make a decision to implement, modify, or reject each of the value engineering recommendations.

Why aren’t all value engineering recommendations implemented?

A Value Enginering team is encouraged to challenge the accepted design and sometimes the base case design is the best value. Although the value engineering team attempts to do all it can to verify the validity and technical soundness of its recommendations, the team has limited time and resources with which to do this. Therefore, after the workshop, the team’s recommendations must be further analyzed before a decision is made to implement each recommendation.

Where can I find out more information about value engineering?

The following web sites offer more information on value engineering:
Federal Highway Administration Value Engineering
American Association of State Highways and Transportation Officials Value Engineering Task Force
SAVE International, the Value Society