Value Engineering/Collaborative Savings

Value Engineering, also called Collaborative Savings, is an organized effort to analyze construction systems, equipment and supplies and achieve the required results at the lowest overall cost, while maintaining quality.

The basic procedure consists of 1) identifying and defining a high cost area; 2) determining the basic function of the item; 3) “brainstorming” the problem to create a list of alternative ways to perform the function; 4) selecting the best alternative that will perform the function at lowest cost; and 5) presenting a proposal or alternative proposals for the design team approval. Participation in the early stages of project allows construction managers to apply ingenuity and technical know-how and produce a more economical design without sacrificing quality.

A construction manager should conduct a systematic and aggressive collaborative value engineering program in conjunction with the design team, with particular emphasis on areas of high cost and those impacting the construction schedule. Areas typically studied include foundations, structural frame, building envelope, floor systems, HVAC systems, ceilings, and luminaries. The evaluation process includes cost analysis, construction feasibility, considerations relative to labor and material availability and effect on the project schedule.

The range of cost factors that should be studied and included in the analysis of alternative choices varies widely, but should include such items as:

  • Construction Costs
  • Comparative Qualities and Aesthetics
  • Impact of Users or Occupants (i.e., power, gas, water, etc.)
  • Ultimate Cost of Utilities (i.e., power, gas, water, etc.)
  • Maintenance (cleaning)
  • Repairs and Replacements
  • Interest on Increased Capital Costs