Strategy Applied Too Late |
In response to Jeffrey A. Sells and Timothy P. Cohens article Value EngineeringCutting Corners Can Shortchange Kids , I would like to suggest that these comments are severely critical of a methodology that does improve the value of any product if applied properly (ENR 7/14 p. 55). It has been my experience that, too often, the value engineering team is called into the project too late. That is usually after the expensive design choices have already been made and it is extremely difficult to make changes that would improve value without eliminating some of these expensive choices. This is especially true if an architects fee is based on the total cost of the project and the designer has invested a significant amount in the design. Naturally, the architect will be upset if value engineering decisions reduce the overall cost of the project by 10 to 25% and the designers fee is reduced accordingly.
Best results from VE are achieved when it is first applied early in the design prior to any significant design activities. Another study is performed after the preliminary design, based on the direction from the first study and available cost estimates. Granted, the cost savings will not be as apparent when VE is applied in this way because the unnecessary costs will have been avoided and not designed into the project in the first place.
Budgets Should Be Better
I have read the recent articles and letters regarding value engineering. Based on my 30 years of experience as a general contractor and construction manager, I would like to add the following comments to the discussion.
1. What most people refer to as value engineering is really just cost-cutting. True value is rarely analyzed or even of interest in these exercises.
2. In 95% of the cases where a cost- cutting effort is pursued after the construction documents are complete, it is because the original budget was too low in the first place and nobody has the guts to go back and ask for more money.
Budgets often are too low because the wrong people are establishing them. Budgets usually come from administrators, architects, planners, accountants and politicians. By the time construction professionals are involved, its too late.
My recommendation to architects tired of their designs being value engineered is to make sure their clients have a well-prepared budget and a clear program before starting the plans.
Value Engineering Revealed
I suggest that Mr. Sells and Mr. Cohen have not participated in a real value engineering study. What they describe is not value engineering.
We should all be aware that cost reduction often masquerades as value engineering. In its simplest form, cost reduction would say that the way to save the most money is to adopt the no-build solution. However, that is not what value engineering is really about.
Value engineering should ask:
Who are the owners, users and stakeholders?
What does the item do?
What should it do?
What else will do the job from a
What will it cost?
What solution provides the best balance among performance, acceptance and cost?
I empathize with the concerns raised by Sells and Cohen, but the culprit is not value engineering.
It is unfortunate that Mr. Sells and Mr. Cohen have experienced the fallout of cost-cutting architecture. Cost-cutting with a subsequent loss of quality and function is not value engineering. Value engineering is the systematic use of techniques to identify the required functions of an item, establish values for those functions and provide the functions at the lowest overall cost. The cost-cutting approach used by construction managers in the school construction projects referred to is not value engineering. It is doubtful that these CMs follow ASTME 1699Standard Practice for Performing Value Analysis of Buildings and Building Systems. Without proper training and understanding of value engineering methodology, these CMs cannot perform value engineering. They perform cost-cutting and they call it value engineering. That doesn't make it value engineering.
Sells and Cohen have missed the opportunity to utilize value engineering when it can make a positive impact on their design and construction project. If they keep doing things the same old way, they will keep getting the same unsatisfactory results. Time to try a new approach.
Designs Should Be Simpler
As a construction manager, I agree that most value engineering ideas involve compromise on the quality of something and I would much prefer to cut elsewhere. But if we suggest cutting $300,000 by eliminating a long barrel vault skylight in the main entrance or try to save $50,000 by eliminating or substituting for the stone at the entry or anything else overdone aesthetically, we are handed our head on a platter. At the same time, the owner only has so much money so we dont have much choice.
I would much rather see the designs of school buildings simplified or modified than quality cut. Architects either need to involve us earlier so we can advise about an expensive design scheme or simply start designing school buildings that are more straightforward and less expensive so we can spend money on things that count and things that last.
The article was right about the construction managers responsibility to defend quality and to completely explain the downside to many value engineering ideas.
Owners Have the Last Say
Jeffery Sells and Timothy Cohen express some valid points on the making of poor decisions, particularly where maintenance and life-cycle costs are concerned. But their labeling of value engineering as an endangerment or as a cost-cutting tool is erroneous.
Value engineering is not a cost-cutting process and anyone who sees or uses it this way totally misses the point and the opportunities value engineering offers. When the correct process is followed, according to the Job Plan established by SAVE International (www.value-eng.org), all of the concerns raised by the authors are addressed in the value engineering study and few, if any, of the problems mentioned in this article occur.
The value engineering team that follows the proper methodology assesses functional alternatives that can improve and enhance the value of a project, process or product. Many of these alternatives offer cost savings and some add costs. The end result is not an independent decision by the team or by the school board or by the contractor. The recommendations generated in the workshop are returned to the designers for their assessment and analysis. All recommendations consider life-cycle costs, which include operations and maintenance. And, when the members of the design team participate in the value engineering workshop, all of their expertise and concerns, like those mentioned in the article, influence which alternatives are put forth as recommendations.
It is wrong to poorly label, misinterpret and misrepresent the value engineering profession, as was done in this article. Value engineering can save the endangered American education system. But the ultimate decisions rest with those paying the tab. Right or wrong, as long as their decision does not endanger public health or safety, or violate any laws or codes, it is theirs to make and theirs to live with. You have heard it said before: You can only lead a horse to water.....
Strategy Applied Too Late
August 11, 2003