1-Value Engineering Methodology in Construction by Mr. Fadi Elayache

Value Engineering Methodology In Construction

Alliances

Alliances

Overview

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What is Value Engineering?

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How Do we Apply VE?

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When is it used?

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Value Engineering Six Steps Plan?

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VE Case Studies

Value Engineering the Forgotten Technique Originally called Value Analysis by its inventor, Larry Miles, an engineer in GE's purchasing operation in 1947, VA/VE uses a value equation that says value is equal to function divided by cost. If, for example, the buyer wants to get more item value, he/she needs to either increase the item's functionality at the same time he/she is containing cost; or he/she needs to reduce cost while holding or improving its functionality. Either way, the result is more value for the customer Ref: Purchasing Magazine - "Value Analysis makes a comeback," Jim Morgan, November 20, 2003.").

What is Value Engineering? Value Engineering (VE) is an intensive, interdisciplinary problem solving activity that focuses on improving the value of the functions that are required to accomplish the goal, or objective of any product, process, service, or organization.

VALUE METHODOLOGY  “The systematic application of recognized techniques which identify the functions of the product or service, establish the worth of those functions, and provide the necessary functions to meet the required performance at  the lowest overall cost.”  Ref: John M. Bryant, VM Standard, Society of American Value  Engineers, Oct. 1998 

Concept of Value

FUNCTION VALUE = COST

Concept of Value Desirable Ideal

Value =

Good

Function Cost

Acceptable

Function Cost

Passable

Concept of Value Undesirable

Undesirable but Passable (cheapening the product)

Value =

Function Cost

Function Cost

When Value Engineering is Used 

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Value Engineering is used to determine the best design alternatives for Projects. Value Engineering is used to reduce cost on existing Projects. Value Engineering is used to improve quality, increase reliability and availability, and customer satisfaction . Value Engineering is also used to improve organizational performance. Value Engineering is used to improve schedule Value Engineering is used to reduce risk Value Engineering is a powerful tool used to identify problems and develop recommended solutions.

Potential Saving from VE Re-Test Feasibility Drawings Released

Cost

Design Changes

Net Savings from VE

Total Cost of VE Implementation

VE Implementation beyond this point results in a net loss.

Concept

Design

Construction Dwgs Release

Construction

Value Study Diagram

Six Steps VE Plan Information Information Phase Phase

** Clearly Clearlyidentify identifythe theproblem(s) problem(s)to tobe besolved, solved,and and gather gatherinformation informationon onthe thebackground, background,functions functionsand and requirements requirementsof ofthe theproject. project.

Functional Functional Analysis Analysis

** What Whatmust mustthe theproject projectdo? do?What Whatare arethe thefunctions functions and andhow howare arethey theyrelated? related?

Creativity Creativity Phase Phase

** Brainstorm Brainstormideas ideason onhow howto toimprove improvethe thehigh highcost, cost, broken, broken,or orinadequately inadequatelyperformed performedkey keyfunctions. functions.

Evaluation Evaluation Phase Phase

** Screen Screenideas ideasfor foracceptance, acceptance,score scoreremaining remainingideas ideas on onaascale scaleand andgroup groupideas ideasinto intocategories. categories. Develop Develop design designscenarios, scenarios,and andselection selectioncriteria. criteria. Rate Rateand and rank rankideas. ideas.

Development Development Phase Phase

** Plan Planhow how to tosell sellideas ideastotomanagement, management,identify identifykey key recommendations, recommendations,plan planmanagement managementpresentation. presentation.

Reporting Reporting Phase Phase

** Give Giveoral oralpresentation presentationto tomanagement, management,or ordevelop develop written writtenreport. report.

Information Phase Facts Finding 

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What do you need to know about the problem that you don’t know now? 

What facts are known?

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What are the requirements of the system?

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Are these facts, opinions, assumptions, or prejudices?

Where or how can information be obtained?

Functional Phase   

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1 2 3 4 5 6

Functions - Describe what something does Functions - Use active verb and measurable noun FAST (Function Analysis System Technique) - A logic diagram to describe how a system works. Examples : Secondary Functions Plan Finishing Material Magnify Living Room Area Reduce Wall Thickness Design Exposure Minimize Defect Design Finishing

Key Function : Satisfy Tenant

Function Analysis

1 2 3 4 5 6 7 8 9 10

Secondary Functions Design Unit Plan Put Cavity Wall Control Temperature Minimize Exterior Surface Execute Natural Ventilation Maintain Cleanliness Supply Air Conditioner Keep View Install Insulation Control Humidity

Key Function : Maintain Facility

Function Analysis

1 2 3 4

Secondary Functions Supply Pipeline Space Design Ventilation Space Provide Elec. Pipe Space Add Sewage Space

Secondary Functions 1 Arrange Wall 2 Collect Opinion 3 Install Art

Key Function : Install Equipment

Key Function : Design Interior

Creativity Definition Creativity is the art of bringing something new into existence. It has the art of making, inventing, or producing something new and different.

Creativity & Innovation You must blast before you can create. Blow apart the misconceptions, skeptics, and naysayers. Blow-up the preconceived ideas and common theories of how things should be done. Rather, focus on possibilities. J. R. Wixson - 2004

Imagination Imagination is more important than knowledge, for knowledge is limited, while imagination embraces the entire world. 

Albert Einstein

Thought of the Day When you always do what you have always done - you always get what you have always gotten. 

Socrates

IDEAS Vs Solutio 

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A solution requires justification & validation, and idea needs no justificati A solution is an end point, an idea is jus the beginning. A solution is solid and self supporting, a idea is tender and must be built upon. DON’T KILL IDEAS WITH 

Information for Skeptics INNOVATION "...

after a few more flashes in the pan, we shall hear very little more of Edison or his electric lamp. Every claim he makes has been tested and proved impracticable." [New York Times, January 16, 1880] AEROSPACE "Heavier-than-air

flying machines are impossible."

[Lord Kelvin, president, Royal Society, 1895] "Airplanes

are interesting toys but of no military value."

[Marechal Ferdinand Foch, Professor of Strategy, Ecole Superieure de Guerre]

Information for Skeptics COMPUTATIONAL SYSTEMS "I

think there is a world market for maybe five computers.“, [Thomas Watson, chairman IBM, 1943] "There

is no reason anyone would want a computer in their home." [Ken Olson, Chairman and founder Digital Equipment Corp., 1977]

"640K

ought to be enough for anybody." [Bill Gates, 1981]

Counter Skepticism

Tilt-up Construction is an innovative construction method that will replace traditional construction of low and mid rise buildings in the Middle East within few years Fadi Elayache 2010

Counter Skepticism Aluminum Honeycomb System is an Innovative Solution for Stone Cladding of High Rise Buildings Vincenzo Portciello, 2010

Counter Skepticism Mateen-bar will replace steel reinforcement in structures exposed to aggressive environmental conditions in the Middle-East , Fadi Elayache 2010

Rules of Brainstorming 

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Generate a large number of ideas - quantity, not quality. Free-wheeling is encouraged - Listen and  improve on the ideas of others. Don’t criticize - No evaluation of ideas Encourage everyone to participate Record all ideas presented  Time to let ideas “incubate” should be allowed. Select an appropriate meeting place

More Creativity

Creative Ideas & Innovative Solutions Will be covered in the VE Case Studies

Evaluating Ideas 

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GO - NO GO −Scratch ideas that hold no interest. CHAMPION  −Who will speak for the ideas and support them? GFI (Gut Feel Index) −Discuss pro/con and vote. GFI is team average. −Combine ideas; add new ideas. −Record all assumptions when voting.

Performance Compa Performance Comparison Matrix Criteria

Option A

Option B

Option C

Option D

1

2

3

3

1

2

3

3

1

1

3

3

Fire Resistance & Safety 

2

2

3

3

Flexibility in Applying Finishes 

1

2

3

3

6

9

15

15

Maintenance 

2

2

2

2

Aesthetics 

2

2

2

3

Roof Structure Constructability  Weather Resistance & Durability  Thermal Resistance 

Score Roof Finishes

1= A 2= G 3= E  

Cost Compariso Option A Cost Estimate - Curved Steel Beam + FRP Cladding Unit

Quantit y

Unit Cost (AED)

Total Cost (AED)

Roof Structure: Curved Steel Beams + Purlins + Intermediate Steel Members

ton

120

28,000

3,360,000

Metal Deck

sqm

1,520

350

532,000

CIP Concrete (150mm)

sqm

1,520

80

121,600

Waterproofing + Rigid Insulation Boards + Protection

sqm

1,520

85

129,200

FRP Panels

sqm

1,520

400

608,000

F.C. Suspension System

ton

30

28,000

851,200

F C Gypsum Board

sqm

1 194

100

119 400

Description

Option D Cost Estimate - PT Concrete S Cladding Un Quantit Description Unit Co y (AE Roof Structure: Post Tension cum 389 3 Concrete Roof Slab Waterproofing + Polyurethane sqm 1,520 Foam Insulation + Protection FRP Panels F.C. Suspension System F.C. Gypsum Board Sub Total

sqm

1,520

sqm

1,194

sqm

1,194

Development Phase

Planning   What is recommended?  Who has to approve it?  What is the implementation plan?  Are mockups or prototypes required to verify final decisions?  What are the cost, schedule, and deliverables?  ROI?

Action Plan  

“What needs to be done?” “Who should be assigned the action?”

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Assign a team member. Assign a completion date for the action.

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“When should the task be completed?”

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Plan regular team status meetings. Anticipate 4-6 weeks to complete the actions.

Plan for Roadblock

Reporting Give oral presentation.  Support it with written executive brief.  Be clear, concise, and positive.  Anticipate roadblocks  Use good human relations. 

Follow –up Activity

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Recognize the participants. Publicize the results. Audit the performance of the implemented actions. Close out the project.

Case Studies Replacing Piles with Footings Worked Performed: Replacing 43 piles with isolated footings outcome

1- Cost Savings = 1,119,000 AED 2- Time Saving = 2 months 3- Easier, tidier and safer construction

Case Study- Resizing & relocating Water Tank Worked Performed: 1- Reducing size from 14,384 to 7000 m3 2-Remove 100 piles 3- Minimize depth to avoid excessive excavation in sandstone layer 4- Relocate WT Under footprint of Bldg outcome 1- Cost Savings = 7,930,000 AED 2- Time Saving = 3 months 3- Easier, tidier and safer construction 4- Regain Land space

Case Study- Lagoon Depth, walls & liners Worked Performed: 1- Reducing depth by 1.25 m about 50000 m 3 2- Replace CIP Reinforced Concrete walls with Pre-cast panels 3- Incorporate underwater theming within pre-cast panels 4- Use Double liners instead of concrete floor with 2 stages installation 5- Introduce leakage detection system in lagoon bottom and behind wall outcome 1- Cost Savings = 8,338,600 AED 2- Time Saving = 2 months 3- Easier constrction

Case Study- Lagoon Depth Five pits were used instead of one To reduce Lagoon Depth by 1.25 m and achieve more effective collection of sediments