In value engineering, value mathematically is defined as function divided by cost. Concentrating on the maximizing of the project’s function and minimizing cost generates the greatest value for our clients. It can be calculated as:
Value = Function/Cost
Where, Function is what the service or product is supposed to do.
Cost is the expenditure needed to create it.
Must Read: General Principles for Valuation of Building
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Value Engineering is an organized or systematic approach that analyzes the functions of systems, facilities, services, equipments and supplies to ensure that they achieve their essential functions at the lowest life-cycle cost consistent with required quality, performance, reliability, and safety. Typically the implementation of the Value Engineering process increases performance, quality, safety, reliability, effectiveness, durability or other desirable characteristics.
In construction, value engineering lies in basic architectural design; selection of right structural system, considering the selection and availability of materials, construction techniques and methods, site limitations or restrictions, transportation issues, planning and organisation, repair and maintenance, life of materials, costs, profits etc. Benefits that can be delivered include a reduction of environmental impacts, reduction in life cycle costs, improvement in quality, safety and health of occupants etc.
Value Engineering is Often Done Systematically by Following a Multiple Stage Job Plan:
The system to follow the eight step procedure which is called the ‘value analysis job plan’.
From all this the basis four steps most commonly followed are:
01. Information Gathering:
This includes what requirements are required for the object. Function analysis is an important technique in value engineering which should be usually done at initial stage. The questions usually arise like:
- What does the object do?
- What must it do?
- What should it do?
- What could it do?
- What must it not do?
02. Alternative Generation (Creation):
In this stage the value engineers usually ask questions like:
- What else will perform the desired function?
- What are the different alternative ways of meeting requirements?
In this stage all the alternatives are assessed by evaluating how well they meet the required functions & how great the cost is saved!
In final stage, the best alternative is chosen and presented to the client for final decision!
The right value engineering should not get restricted to initial capital cost, but should take care of life cycle cost.