What are the main challenges and benefits of applying value engineering in project engineering?

There is always conflict between an individual who tries to revisit a concept that is already agreed and being driven by managers. There is never time to do it properly there’s always time to do it over. It is highly likely that the value engineer will be fired since he will be regarded as an obstruction to progress.

It is important to never take anything for granted. Always assume people are well meaning and do good work. And remember it is always nice to have someone re check on occasion what was done. Sometimes a team gets lucky and finds a quick win, that can completely revalue a project!

Understanding the Highest Order Function (HFO) in Value Engineering In VE, understanding the HFO is crucial for maximizing value. The HFO defines a system's core purpose, focusing on the ultimate goal rather than just individual features. For example, the HFO of a flashlight is to enhance visibility in darkness. Features like brightness settings and battery life support this core function. In my recent project managing a cooling system for a power plant, identifying the HFO as "optimal consumption of material and energy" rather than just "heat dissipation" led to more impactful improvements. By focusing on the HFO, we ensured our efforts aligned with the system’s primary objectives, resulting in greater efficiency and effectiveness.

The more collaboration and engagment between the project design team, Value Engineering team and stakeholders, the better the outcomes of the VE study.

The merit of Value Engineering lies in its unwavering commitment to optimizing function performance while minimizing resource consumption from the outset. By fostering creativity among team members, it not only evaluates but also develops the most valuable ideas, ensuring they are effectively communicated to project stakeholders and seamlessly integrated into implementation strategies.

When Value Engineering should be Applied? Value Engineering (VE) can be applied at any stage of the project life cycle, from initiation to closure, but it is most effective when used early in the project, such as during the planning and design phases.

alue engineering is calculated as a ratio of function to cost. The way to add value to a product is either by reducing cost or improving functionality. It’s more likely a business will seek cost-cutting and preserve the function of its product. This process can be broken down into five phases: information, creative, evaluation, development and presentation. Value engineering is when a business looks at how it functions and develops a systemic and organized approach to deliver its project at the lowest cost possible. It does this through the substitution of less expensive alternatives such as materials and methods. However, this must be done without sacrificing quality or functionality.

In my experience, VE is often initiated with an emphasis on the "Value" as a way to reduce project cost, usually only when under budget constraints. This typically results in removing functionality, or substituting different products, services or suppliers. While this approach may lower initial project costs, it often increases the overall lifecycle cost with higher operation and maintenance expenses. Placing a higher emphasis on the "Engineering" aspect requires more time and effort initially, but can ultimately deliver a better result at a lower cost. VE solutions may vary widely from one project to the next, so the Engineering component is critical to ensure each project is successful.

The type of project can govern which stage is optimum for implementing VE. There are 3 that I’ve witnessed and managed myself: 1. Concept & Planning: implementing VE meets lower resistance but constrains finalization of design 2. Prototype: the team can focus on meeting the critical functions first and then turn their attention to reducing the cost. Helps organize VE effectively. 3. Post Production: this stage offers a lot of benefits: increases your margin on an established product, pass of cost reduction to customer to retain customer or compete against new entrants. Challenging exercise as design & supply chain is firm but results are rewarding.

Value engineering in project engineering faces challenges like initial resistance and time constraints. However, it yields benefits such as cost savings and enhanced project efficiency. In the energy sector, optimizing turbine designs through value engineering reduces manufacturing costs. Implementing energy-efficient technologies exemplifies how value engineering aligns projects with sustainability goals. Overcoming challenges demands a collaborative approach, emphasizing the importance of continuous improvement in project outcomes. Success stories underscore how value engineering fosters innovation and long-term project viability in the dynamic landscape of the energy sector.