Dear List Readers:
I agree with Mr. Bremer's observations and most of the other
observations on this subject. In fact, there was a very thoughtful
posting on this very subject matter by Jodi Evans on this list - 21
Nov., 1997.
I have also heard the old saying "the blind leading the blind" used in
the context of this process of museum planning and museum design or
renovation design.
On one hand, you have the architect who has, in all probability, never
designed or renovated space for museum use - on the other hand, you have
the museum professionals and the museum's Board who, in all probability,
have never gone through such a building process.
And there is not a whole lot of material written on this important
process where one can turn for answers. One of the most recent (1993)
books on this subject matter has been published by - and is available
through - The National Endowment for The Arts. Entitled "Museum Design
- Planning and Building for Art," this publication provides excellent
advice for museum professionals contemplating any type of museum
building program, not just art museums. Another very excellent (and
practical) publication is "Before The Blue Print," which is available
from The Association of Science-Technology Centers.
In the area of Museum Planning and Museum Design/Construction, there is
also another tool which one can utilize - not only in the Design Phase -
but in the Planning Phases. This tool is called Value Methodology -
although it might be better known to some of you as Value
Engineering/Value Analysis. For your information, I am enclosing a
brief description of this Methodology (please excuse the appearance of
the description when it appears on your computer).
By utilizing Value Methodology in the Planning Process and during the
early architectural design (up to the 35% - 40% design phase), one can
assure quality in the museum building program - and just possibility cut
costs at the same time. This is the reason why Value Methodology is now
mandated by law in all Executive Agencies of the Federal Government and
by a number of State Governments - where State Funding is used.
Kind Regards
Roger Wulff
Museum Services International
[log in to unmask]
Tel: (202) 462-6176
Fax: (202) 462-2380
VALUE METHODOLOGY
AND ITS ROLE
IN ENABLING YOU TO
DO MORE WITH LESS
PRESENTED AT:
THE 1998 NATIONAL CONFERENCE ON CULTURAL PROPERTY PROTECTION
BY:
ED NICHOLS ROGER L. WULFF
EDWARD J. NICHOLS AND MUSEUM SERVICES
ASSOCIATES, INC. INTERNATIONAL
8109 HINSON FARM ROAD 1716 17TH STREET N.W.
SUITE 513 WASHINGTON, D.C. 20009
ALEXANDRIA, VA 22306 (202) 462-6176
(703) 780-6933 FAX: (202) 462-2380
FAX: (703) 780-8709 E MAIL: [log in to unmask]
E MAIL: [log in to unmask]
AN INTRODUCTION TO THE METHODOLOGY OF "VE" AND "VA"
During this short presentation, we will introduce you to the field of Value Methodology - explain what Value Methodology is - and provide some concrete examples of how Value Methodology will help you and your institution to input quality into a program or project and even cut costs by using Value Planning and Studies in your operations.
In Value Planning and Studies we usually speak very plainly, and that is how we will address you today - using plain langauge which everyone will understand. We are not trying to "sell" you something - or even sell ourselves.
Value Methodology is simply that - a methodology which is used by private industry, state governments and the Federal Government to lower costs and improve their various products and activities. However, the various processes and workshops of this methodology should be led by someone who completely understands it's principles and who is well experienced in conducting Value Studies - A Certified Value Specialist.
In the cultural and museum communities, Value Methodology and its applications is a new and unfamiliar field. Unless a professional working in these areas has had previous experience with design/construction projects, he or she will not even be familiar with the terms "Value Analysis or Value Engineering." Within the design/construction area Value Methodology is now considered a Standard Operating Procedure and is mandated by law in a number of jurisdictions such as The Commonwealth of Virginia.
In a recent publication dealing with Art Museum Design and Planning it was stated that:
"Construction managers and owner's representatives can also provide a service called Value Engineering, making alternative recommendations to build comparable structures in a more cost-effective way than had been proposed by the designer or architect." 1.
In the same publication, it was also stated that "the single most important economic phenomenon acknowledged by the museums surveyed (and also universally throughout the field) is that museums often are not adequately prepared for the high costs of future operations."
What this publication did not state is the fact that Value Engineering can also help a museum plan for or "get a handle on" these future operational costs through a proces known as LIFE CYCLE COSTING.
Recently, the author of this paper was asked to be a member of a Value Engineering Team assembled by Edward J. Nichols and Associates, Inc. for a proposal to conduct Value Engineering Studies at The Science Museum of Virginia in Richmond, VA. It was during the preparation of this proposal that the author learned more about the fields of Value Analysis/Value Engineering and the tremendous quality assurance and cost-savings potential it held for the cultural and museum communities, not only in their construction of new and renovated facilities, but in the design and operation of their programmatic activities as well.
1. "Museum Design - Planning and Building for Art," Joan Darragh &
James S. Snyder, Oxford University Press, in association with The
American Federation of Arts and The National Endowment for The
Arts, New York, 1993, PP. 142 -154.
After being selected by The Science Museum of Virginia for this project, we learned that our VE Team was to conduct a Value Engineering Study on the Building Program for a major renovation to the present museum structure (housed in a former Railroad Station c. 1917) at the 35% design stage and later phases (a one year contract). OUR INITIAL VALUE ENGINEERING STUDY FOR THIS MAJOR RENOVATION PROJECT RESULTED IN WELL OVER ONE MILLION DOLLARS OF SUGGESTED CAPITAL COSTS SAVINGS WITH A SUBSTANTIAL AMOUNT OF LIFE CYCLE COST SAVINGS INDICATED.
WHAT IS VALUE ENGINEERING?
Value Engineering (synonymous with the terms
Value Management, Value Analysis and Value For Money)
is a professionally applied, function-oriented, systematic
objective team approach used to analyze and improve
value in a product, facility design, system or service -
a powerful methodology for solving problems and/or
reducing costs while improving performance/quality
requirements. By enhancing value characteristics,
Value Engineering increases customer satisfaction
and adds value to your investment. Value Engineering
can be applied to any business or economic sector,
including industry, government, construction and service.
Value Methodology can be utilized for:
Value Engineering Studies. This is a value study of an engineering or construction related activity. An independent, multi-discipline team conducts it. Such independent teams are formed using team members which have not had significant prior involvement in the project under study. The most common timing for the value study is at the concept (25-40 percent of design complete) phase, prior to management briefings and decisions that set the direction for final design.
Value Planning Studies. This is a value study performed at the initial phases of a program, project, process, or activity. The purpose of this type of value study is usually to determine mission and identify possible alternative directions. It often optimizes both the mission objectives and the operations to get the project initiated (e.g., procured, programmed, designed, and organized). Scoping, re-invention, criteria/limits, and other similar types of specialized value studies are considered subsets of this type of study.
Value Management Studies. This is a value study that involves management of resource issues. In some situations, this type of study may involve answering a specific mission charge or question for management. Consequently, the value study team may be directed, depending on the "charge" to the team, to not consider the question of whether going a particular direction is best. Management or the administration may set the direction, and the "charge" to the value study team is to find alternatives to implement this direction at the greatest value obtainable.
Value Analysis Studies. This is a value study performed to study processes, procedures, or repetitive program activities. These studies may also involve answering a specific mission charge or question. These definitions allow reviewers of a study to quickly understand its scope and limits. To ensure the opportunity to achieve the highest value, Value teams attempt to keep management or administration directed mission charges flexible enough to allow innovation.
HISTORIC USE
VE was developed during World War II by U.S. industry as a means to continue production in the face of shortages of critical war material by substituting materials or systems that were available to accomplish the required task. The General Electric Company is generally credited with the development of the technique then known as "Value Analysis." The U.S. Navy's Bureau of Ships in 1954 applied the concept to reduce costs during the design stage and called it ``Value Engineering'' due to the fact that the Federal Government already had a category code for Engineering Expertise within its Contractor Expertise Code - it did not have a category for "Value Analysis."
The Department of Defense (DOD) accepted VE as a practical means of
obtaining the best practical value from its procurements and adopted VE in contract clauses under the Armed Forces Procurement Regulations (AFPR) in 1961, permitting contractor incentives in sharing VE contract cost reductions.
CURRENT USE
Currently all of the DOD's operating agencies have adopted VE in their procurement programs, including construction, as have agencies of the DOT including the FAA, Federal Highway Administration (FHWA), the Federal Transit Authority (FTA formerly UMTA),The Environmental Protection Agency, The Interior Department and now The National Park Service is initiating plans for VE/VA Studies within the U.S. National Parks System.
The FAA achieved life-cycle savings of $65 million on one construction project alone (airport cable loops/telecommunications), and the FTA reported life-cycle savings of $2.18 million on a bus maintenance facility. Other agencies have reported large life-cycle savings in construction programs, such as the Environmental Protection Agency (EPA) with life-cycle savings of $235 million over a 5-year period, the General Services Administration (GSA) which reported life-cycle savings of $43.4 million over the period 1972 to 1979, and the U.S. Army Corps of Engineers which reported life-cycle savings of $2 billion over the period 1964 to 1989. VE provides both the funding agency and the sponsor of a project with the opportunity and the means to not only improve the project but to substantially reduce costs.
FUNDAMENTALS OF VALUE ENGINEERING
The Federal Acquisition Regulations, Part 52.248, defines value engineering as an organized effort to analyze the functions of systems, equipment, facilities, services, and supplies for the purpose of achieving essential functions at the lowest life-cycle cost consistent with required performance, quality, and safety. VE is an important management tool for optimizing expenditures of funds. Numerous government and private organizations have realized significant life-cycle savings since VE was first introduced, and although the techniques were developed for manufacturing and fabrication processes it has been equally applicable to the design of transportation facilities and construction/renovation projects. Engineers have been doing this type of analysis as a matter of course in their work since engineering was developed. The difference is that VE is an organized approach for a second look using a consistent set of concepts to optimize the difference between the cost of doing the construction and the cost of satisfying the user of the facility constructed. Reducing the scope of a project, or compromising the performance of an element, or simply substituting cheaper materials that will not function with the required reliability is not value engineering. The key feature of VE is the user-oriented approach.
Reduced to it's simplest terms, it asks five basic questions:
1. What is it?
2. What does it do?
3. What does it cost?
4. What else will do the job?
5. What does that cost?
TIMING
VE, as it relates to the engineering and design of projects, is most effective when it is accomplished early in the design phase of the project. VE is most effective during these early stages because the ideas are still conceptual and the sponsor and the designer can be flexible with their decisions without incurring delays in the project schedule. The sponsor and designer should be examining their project budget at this point and performing a VE study can help them identify high cost elements before the final budget is decided. Once major decisions, those involving high cost items, are made the opportunity to influence final costs is greatly reduced.
Value engineering studies for construction projects should be conducted at about the 30 percent completion point of design. Therefore, the designer should submit a partially completed design at the 30% or 35% design completion stage. This partially completed design will be value engineered. There may be instances where value engineering at the 30% or 35% design stage is not appropriate. For example, construction phasing can have a significant impact on costs but not be determined until late in the design process.
ESSENTIAL CHARACTERISTICS OF VALUE ENGINEERING
VE has five characteristics that are essential to its success. First, VE relies on the use of many widely accepted analysis concepts and techniques. Second, VE is a systematic process and follows an eight-step job plan. Third, VE focuses on identifying and analyzing the function that the project component(s) or activity fulfills. Fourth, VE utilizes creative analysis techniques, especially "brainstorming."
Fifth, VE is performed by a team not associated in any way with the design team or the sponsor and draws upon the objective individual and collective viewpoints, experience, and knowledge of its members.
VE JOB PLAN
The systematic approach used in VE is called the VE Job Plan. It is an organized plan of action for completing a VE study and includes the implementation of recommended changes. There are eight elements or phases of the VE Job Plan:
Selection Phase. The objective of this phase is
to select the project to be studied and assemble
the VE team. This phase is one of the most
difficult aspects of VE. Not every project requires
a VE study. Some projects involve large sums of
money but are relatively straight forward with little
opportunity for alternatives. Other projects may
involve expensive environmental commitments
that may preclude value engineering judgments.
Unusually large and/or complex projects are
possible candidates for VE analysis. Complex
projects might include one or more of the
following features:
- Terminal buildings
- Security systems with many interactive devices
and redundancies
- Bridges
- Large scale paving projects and/or those with
complex drainage patterns and structures
- Foundation or embankment conditions requiring
preconsolidation
- Large retaining walls
- Installation of lighting and NAVAID systems
VE studies should only be undertaken when there is a good possibility of obtaining substantial life-cycle savings or improved design.
Project Selection. In the selection of the project to be studied consideration should be given to the size of the project, the amount of life-cycle savings feasible, and the cost of the study. Commonly the most cost effective application of VE is against the highest cost components of a facility or project. Typically VE programs set a minimum target of three to five percent and often more for savings over and above the cost of the study. The decision to use VE and its application to a specific project should be discussed at the predesign conference.
THE VE TEAM
A team consisting of five to seven persons usually produces the best results. The team should be structured so there is appropriate expertise to evaluate the major problem areas anticipated within the project, e.g., building components, operations, lighting, security systems, foundations, soils, drainage, environment, etc.
INFORMATION PHASE
The objectives of this phase are to gather pertinent information, analyze function and cost, and identify greatest opportunities for life-cycle savings. This approach breaks down the item to it's fundamental functions or purpose such as - what is it?, what does it do?, how much does it cost?. Data such as that relating to design criteria, plans and specifications, design restrictions, codes, standards, quantities, operations, and maintenance should be assembled. These are needed to familiarize the team on the project scope, establishment of constraints for function and cost evaluation, and to isolate the items of major costs.
SPECULATIONS PHASE
The objective of this phase is to identify the maximum number of alternatives which will perform the intended function. This is sometimes referred to as the``brainstorming phase.'' This phase identifies alternatives for evaluation, development, and refinement. It asks the question - What else will do the job and how much does it cost?
EVALUATION PHASE
The objective of this phase is to evaluate the suggested alternatives, eliminate unsuitable ideas, and select the most promising alternatives. This is a key element of the process, the determination of those ideas which will provide the required function(s) with the mandatory degree of reliability, safety, impact on operations, and other design criteria. Here the question of will it work is asked and the total costs are compared along with intangible factors.
DEVELOPMENT PHASE
The objective of this phase is to develop specific details about each promising alternative and prepare recommendations. A fully developed alternate is often called a value engineering proposal (VEP).
RECOMMENDATION AND APPROVAL PHASE
The objectives of this phase are to recommend VEP's developed in the study and to obtain the approval of the sponsor for their inclusion in the final design. Prior to presenting the VEP's to the sponsor, the VE team must make recommendations to the original design team or the project management team. Recommendations should include the following: results of the function analysis, technical and cost data supporting the alternatives, problems and costs of implementation, and estimated life-cycle savings. At this point the most logical and feasible alternatives are selected by mutual agreement between the original design team and the VE team. The agreed upon alternatives are then recommended to the sponsor for final approval.
IMPLEMENTATION PHASE
The objective of this phase is to put the accepted recommendations into practice. After the VEP has been approved by the sponsor, it is incorporated into the final design and construction schedule. The responsibility to incorporate and implement the change rests with the design team or the project management team. Action should be taken to ensure that it is fully coordinated and applied.
AUDIT PHASE
The objective of this phase is to ensure that the desired results have been attained, documented, and reported. The results of the VE effort should be incorporated in the engineers' report showing what VEP's were adopted and the life-cycle savings associated with each VEP.
NOW FOR SOME GOOD NEWS OUT OF VIRGINIA:
Governor Allen Announces Transportation Savings
- VDOT Program Saves $100 Million over Last Six Years -
RICHMOND - Governor George Allen today announced that the Virginia Department of Transportation's (VDOT) Value Engineering program has saved Virginia taxpayers $100 million since 1990. Value Engineering, a program begun in Virginia during the mid-1970's but required by law since 1990, reduces costs by reviewing transportation project plans for possible savings while still maintaining mandatory standards.
"The Commonwealth of Virginia is proud to be a national leader in the field of Value Engineering," said Governor Allen. "Spending the Commonwealth's money carefully and frugally is our responsibility to the taxpayers. VDOT is setting the example for the rest of the Commonwealth and the nation."
Since 1990, VDOT has conducted 426 studies with 53 percent of the Value Engineering(VE) recommendations accepted. Over the six-year period, the cost of the program was such that each dollar spent on the program resulted in $62 of savings.
"Value Engineering is a program that works well," said VDOT commissioner David R. Gehr. "Giving our customers the highest quality product at the lowest possible cost is our goal, and Value Engineering is only one way we are achieving that goal."
Because of its success, VDOT has performed studies on projects for other states and assisted other state departments of transportation in establishing their own VE programs.
2.1-483.1:1, CODE OF VIRGINIA
A/E MANUAL
SECTION 814.0 VALUE ENGINEERING (VE)
814.1 General: Capital Projects with an estimated construction cost greater than $ 5,000,000 shall have a 40-hour Value Engineering (VE) Study conducted on the design. The study shall be conducted be a qualified VE Team concurrent with the preliminary (40%) design review utilizing the five- step job plan as recognized by the Society of American Value Engineers (SAVE). A presentation of the study results shall be made to the Agency.
U.S. GovernmentValue Engineering Requirement
The U.S. Office of Management & Budget (OMB) issued a circular in June 1993 calling for government wide use of Value Engineering and requiring Federal agencies to implement Value Engineering techniques in contractor and in-house programs and projects. Value Engineering applications help to add value to our government services and reduce the deficit.
SOME INFORMATION FROM WASHINGTON ABOUT VALUE ENGINEERING DEFENSE AUTHORIZATION ACT
On February 10, 1996, President Clinton signed the Defense Authorization Act, now known as Public Law 104-106, which contains a special section of procurement reform for the entire Executive Branch, not just Defense. The bill reads:Sec SEC. 4306. VALUE ENGINEERING FOR FEDERAL AGENCIES(a) USE OF VALUE ENGINEERING. The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), as amended by section 4203, is further amended by adding at the end the following new section:"SEC. 36 VALUE ENGINEERING."(a) IN GENERAL. - Each executive agency shall establish and maintain cost-effective value engineering procedures and processes."(b) DEFINITION. - As used in this section, the term value engineering means an analysis of the functions of a program, project, system, product, item of equipment, building, facility, service, or supply of an executive agency performed by qualified agency or contractor personnel, directed at improving performance, reliability, quality, safety, and life cycle costs."
VALUE ENGINEERING SAVES MONEY WHILE IMPROVING QUALITY There is so much talk of billions of dollars these days that it is easy to forget that every dollar saved, particularly if efficiency is improved, is meaningful to a hard working taxpayer -- and Value Engineering saves a lot of dollars! The General Accounting Office estimates Value Engineering savings at 3-5% of program cost.
Discussion of The VE Study at The Science Museum of Virginia -------
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