Value analysis.

Abstract

As defined by the Office of Management and Budget, value analysis (VA) is “an organized effort directed at analyzing the functions of systems, equipment, facilities, services, and supplies for the purpose of achieving essential functions at the lowest life-cycle cost consistent with the required performance, reliability, quality, and safety.” “Value analysis” is the most generalized term associated with the application of value-based processes. Other terms include “value management” and “value engineering.” Historically, value management (VM) has focused on organizational and management processes, while value engineering (VE) has been applied to manufacturing processes and procedures. In the construction industry, the terms have been used interchangeably and often applied to cost reduction efforts that use few, if any, value-based processes. To start afresh, the term “value analysis” is used in this topic. Value analysis concepts have been applied to construction projects in numerous ways for more than 30 years. Despite this history, value analysis has generally been viewed skeptically in the construction industry. To some, value analysis is the answer to every problem project, and to others it is a cost-cutting, quality-reducing exercise that infringes on both the design team and the owner. In fact, value analysis is a process for identifying and solving problems. When properly applied to a suitable problem, it yields excellent results. When applied incorrectly, it can create problems of its own. Application of VA procedures requires patience, concentration, and a certain amount of discipline. Probably the most important premise is that participants should agree on objectives and be willing to work toward common goals. When VA is incorporated into an overall project delivery approach, the design team can find it an extremely useful tool for general problem solving, cost/function optimization, and value enhancement. Value Analysis Michael D. Dell’Isola, PE, CVS