What is VE?

Value Engineering and its Benefits

What is Value Engineering

Value Engineering is a function oriented, systematic team approach and study to provide
value in a product, system or service. Often, this improvement is focused on cost reduction;
however other important areas such as customer perceived quality and performance are also
of paramount importance in the value equation.
Value engineering techniques can be applied to any product process procedure system or
service in any kind of business or economic activity including health care, governance,
construction, industry and in the service sector.
Value Engineering focuses on those value characteristics which are deemed most important
from the customer point of view.
Value Engineering is a powerful methodology for solving problems and/or reducing costs
while maintaining or improving performance and quality requirements.
Value Engineering can achieve impressive savings, much greater than what is possible
through conventional cost reduction exercise even when cost reduction is the objective of the
task.

What are the benefits of Value Engineering

Value Engineering helps your organization in

Lowering O & M costs

Improving quality management

Improving resource efficiency

Simplifying procedures

Minimizing paperwork

Lowering staff costs

Increasing procedural efficiency

Optimizing construction expenditures

Developing value attitudes in staff

Competing more successfully in marketplace

Value Engineering helps you to learn how to:

Improve your career skills

Separate "Symptoms" from "problems"

Solve "root cause" problems and capture opportunities

Become more competitive by improving "benchmarking" process

Take command of a powerful problem solving methodology to use in

any situation

How Value Engineering Applied

The technique of Value Engineering is governed by a structured decision making process to
assess the value of procedures or services. Whenever unsatisfactory value is found, a Value
Management Job plan can be followed. This procedure involves the following 8 phases :
1. Orientation 2. Information 3. Function 4. Creativity 5. Evaluation 6. Recommendation 7.
Implementation 8. Audit

Where can I find more about Value Engineering ?

The best and most convenient way to learn the technique of Value Engineering and its
application, is by becoming a member of Indian Value Engineering Society (INVEST).
INVEST is a professional society established in October, 1977 and dedicated to the advancement
of Value Engineering through education. This provides a better understanding of the principles,
methods and concepts of value technology. INVEST has members in virtually every state in India.
It maintains a network of chapters throughout the country and provides its members with
additional educational opportunities at the local level.
INVEST is affiliated to the Society of American value Engineers (SAVE).

Value engineering is used to increase the value of products. Value is a ratio of function to cost. The value
of a product can be increased by reducing its cost or increasing the function. Value engineering is an
organized technique to reduce the cost of a product without compromising with its quality, reliability,
performance, appearance, safety, utility etc. The possible functions by which the cost of a product can be
reduced are

1. Modification in design of product

2. By adopting the most efficient manufacturing process
3. By changing the source of supply of material
4. Possible elimination or addition in the related system
The aim of value engineering is to systematic identification and elimination of unnecessary costs. It is
applied for existing products rather than new products.

Objectives of value engineering/value analysis:

Increased profits With the cost reduction of a product, the profits of an organization
increased. This results in time reduction. It also ensures greater returns on invested capital. The
competitive position of company also improves.
Improved product Design With the modification in design, the customer will get a new and
more acceptable product.
Efficiency It increases the efficiency of employees as it motivates them to come forward with
their creative ideas. It also makes contributions to improve human factors such as creativity,
team

work

and

positive

attitude

among

employees.

The

team

approach

also improves the decision making.

Time consideration A product has value for the customer if it is available to him on time. So
time element has great importance in value engineering. It may have no value if it arrives later.
Improvement in quality This results in improvement in quality, reliability, performance and
maintainability of a product.
Steps for value analysis:
1. Establish the objectives Example - cost reduction, function improvement
2. Orientation/preparation Make a team for design, marketing, purchasing etc and fix a
proper schedule.
3. Information gathering Information of cost, physical parameters, schedule etc
4. Analysis
5. Innovation/Creativity A brainstorming session can be held to explore all possible
alternatives.
6. Option evaluation Evaluate all possible solutions and select the best alternative.
7. Implementation and monitoring Make a plan for implementation of change.

Value Engineering (VE) is a systematic process using a team

from a variety of disciplines to improve the value of a project
through the analysis of its functions. The VE process
incorporates, to the extent possible, the values of design;
construction; maintenance; contractor; state, local and federal
approval agencies; other stakeholders; and the public.

The primary objective of a Value Engineering study is value

improvement. The value improvements might relate to scope
definition, functional design, constructibility, coordination (both
internal and external), or the schedule for project development.
Other possible value improvements are reduced environmental
impacts, reduced public (traffic) inconvenience, or reduced
project cost.
Value Engineering can be applied during any stage of a
projects development, although the greatest benefits and
resource savings are typically achieved early in development
during the planning or scoping phases.
Value Engineering (VE) is a proven, effective tool for both
continuous improvement and design enhancement. VE
optimizes the allocation of limited funds without reducing the
quality of a project.
Value Engineering Objectives

Build consensus with our partners to encourage

positive impacts on project delivery.

Innovative cost avoidance ideas become standard on

future projects.

Reduce life cycle cost of items to lower future

maintenance costs