What is Value Engineering?

Value Engineering (VE), is a systematic approach that is used by a team of value engineering on business, construction or industrial field and they applied Value Methodology to satisfy clients' need, explore the maximum benefit, improve planned procedure and cut down cost on assigned projects or cases in a short period of time while maintaining or enhancing the system functions. Value Engineering was suggested by L.D. Miles in the US in 1947 and then developed into Value Methodology. After Japan started to use this system in 1960, we then begin to apply this system at varieties of field starting from 1967.

The reason being:
1.Regulations or Clients required
2.Products are being challenged and the only way to survive is to lower the cost to gain the ability to compete.
3.Too much complaint from customers on products that they should improve the quality right away.
4.Value Engineering can promote the products, increase the quality, lower the cost, and improve the ability to compete.

Cost of Value Engineering and the actual benefits.
The cost of Value Engineering project is approximately 0.2% to 0.4% of the whole budget. According to the statistics figures, it can help to save budget at least up to 5% to 20%. The average ROI will be bumped to 12 to 100 times more than the traditional operating way.

The clients can have a clear understanding of the whole project procedure through the indirect benefit of the investigation of Value Engineering, including basic needs, the distribution of the cost, backup plans and other decisions that are made to improve the overall quality.
Moreover, conflicts from departments or time that spend on each stage of the project will all be improved through the investigation of the value engineering.

Where or whom to apply Value Engineering?
Any subjects or events that have a special need of perfecting the quality, ability, and lowering the cost are suitable for Value Engineering. VE can also be applied on Construction, Manufacture and Service Industries etc...To make a long word short, anything that is depended on the increasing quality and lowering the cost to make a success will all be fitted into plans of Value Engineering.

Examples of Successful Value Engineering Project
In Construction Industry, The Taipei City Government MRT used Value Engineering to evaluate and design their project to lowered the budget at least NT$10 billion. In manufacture industry, Yulong Automobile applied the value engineering to increase the quality of its product which made the car, Cerfiro, a favorite of the Taiwanese drivers. And it also created huge profit and great reputation for themselves. In service industry, IBM applied value engineering to improve the speed of their work, shortened huge amount of time and further accelerated the speed of collecting account receivable.

When is a good time to apply Value Engineering?
As soon as all the required information are completed then value engineering can be start to apply on each sections of procedure. The earlier the better, because value engineering can lower the cost and reduce resistance, thus create higher efficiency. For construction industry, when reaching the stage of planning, designing are good time to execute value engineering. As for manufacture industry, apply the value engineering before the production stage will be a good time.

Who should be the one to lead the Value Engineering project?
The teams that execute the project of value Engineering includes a leader and some experts. The leader will be chosen from a group of experienced professional and he or she must have the certificate to perform value engineering project. Experts will be picked from experienced researching staffs who have professional skills on fields of design, procurement, production, quality control, technology, and sales.

Win, Win, Win for the clients, business and employees.
For the clients(including users and society), Value Engineering can provide a low-priced but great quality product.

For the business, Value Engineering has advantages listed below:
1.It can provide a low-priced but great quality product and excellent service, plus it can contribute benefits to the society and make sure a certain amount of ROI.
2.It can develop a creative atmosphere for the society.
3.Through the varieties of communication skills, it can help the business to get rid of old and bad habits and further rejuvenate the organization.

For the participated employee, value engineering can help to develop creativeness and generate self-esteem:
1.From the experience of creating new ideas, one can experience the satisfaction of self-esteem.
2.From the system thinking of Value Methodology and sharing of study experience, value engineering can bring intelligence that can be applied on everyday life.

To conclude, Value Engineering is not only a tool to lower the cost, it is also a good tool to increase the growth for clients, business and employees.