Value engineering works when applied correctly
Dame Judith Hackitt should understand that the principles of value engineering are not only about saving money, writes Katherine Bethany
Dame Judith Hackitt, in her recent speech at the Chartered Association of Building Engineers, stated that the term ‘value engineering’ should be driven out of construction. She commented that it was a phrase she would be “happy to never hear again. It is anything but value. It is cutting costs and quality.”
In reviewing her remarks, and the definition of value engineering, I would agree with her – when used as only a “cost cutting” tool, it is not a good idea. That is not how SAVE International, the international society devoted to advancing and promoting value methodology, defines value engineering. Done correctly, the outcome of the value methodology is definitely not cost cutting or a cheapening of the project.
Value engineering was developed in 1942 by Larry Miles for General Electric (GE) during World War II. Miles developed the tool to find alternative materials and ways to build products produced by GE during World War II when materials were in short supply.
Performing the value methodology correctly requires an analysis of the function(s) of the project or product or system being studied. The outcome solves problems and reduces life-cycle costs while improving performance and quality. If a process does not include the function analysis, or the recommendations and solutions from the study, or the improvements to quality and performance, then it is not a true value engineering study.
Current procurement systems that rely on “lowest cost” awards are flawed and Dame Hackitt’s efforts at reform should be applauded. Cost cutting exercises which are purely about saving money are not true value engineering. But applied correctly, value engineering does have an important place in construction.
Katherine Bethany is president of SAVE International, which promotes and advances the use of value engineering.