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Value engineering application in a high rise building (a case study in Bali)

Putri Arumsari 1 and Ricco Tanachi 1

Published under licence by IOP Publishing Ltd IOP Conference Series: Earth and Environmental Science , Volume 195 , The 2nd International Conference on Eco Engineering Development 2018 (ICEED 2018)5–6 September 2018, Alam Sutera Tangerang, Indonesia Citation Putri Arumsari and Ricco Tanachi 2018 IOP Conf. Ser.: Earth Environ. Sci. 195 012015 DOI 10.1088/1755-1315/195/1/012015

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1 Civil Engineering Department, Faculty of Engineering, Bina Nusantara University Jakarta, Indonesia 11480

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Finding affordable alternatives material to replace the initial design of the architecture work of a commercial high rise building project without reducing the value of the material itself. Then analysing the cost saved from applying the value engineering in the architecture work of a high rise building. Calculation through the value engineering process was conducted. A commercial high rise building in Bali was chosen as a case study to implement the value engineering process in the design stage. The value engineering stages included calculating the cost/worth function, analysing through Function Analysis System Technique (FAST), innovation and creativity stage, evaluation of the life cycle cost, decision analysis and last the decision making. The research found that by applying value engineering through several items of work in a commercial high rise building it could save up to up to 8% of the total cost of the architecture work. The architecture work that was analysed through value engineering were the wall work, the door work, the floor work and the sanitary work. These were found to be the most effecting result from the Pareto calculation. The application of value engineering is this research was only done in one commercial high rise building in Bali. The work analysed was also only the architecture work. Therefore other types of construction project might result in different value of cost saving. This research identifies the cost saved through the application of value engineering in a commercial high rise building in Bali, which emphasizes on high quality materials in the architecture work. This research will contribute to the study literature of value engineering with a case study of commercial high rise building.

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Component Cost Reduction by Value Engineering: A Case Study

• Published: 29 June 2016
• Volume 98 , pages 219–226, ( 2017 )

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• Vinayak Kalluri 1 &
• Rambabu Kodali 2  

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The concept value engineering (VE) acts to increase the value of a product through the improvement in existent functions without increasing their costs. In other words, VE is a function oriented, systematic team approach study to provide value in a product, system or service. The authors systematically explore VE through the six step framework proposed by SAVE and a case study is presented to address the concern of reduction in cost without compromising the function of a hydraulic steering cylinder through the aforementioned VE framework.

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BML Munjal Univerity, Gurgaon, 122413, Haryana, India

Vinayak Kalluri

National Institute of Technology Jamshedpur, Jamshedpur, 831014, Jharkhand, India

Rambabu Kodali

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Correspondence to Vinayak Kalluri .

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Kalluri, V., Kodali, R. Component Cost Reduction by Value Engineering: A Case Study. J. Inst. Eng. India Ser. C 98 , 219–226 (2017). https://doi.org/10.1007/s40032-016-0279-0

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Received : 15 September 2012

Accepted : 16 May 2016

Published : 29 June 2016

Issue Date : April 2017

DOI : https://doi.org/10.1007/s40032-016-0279-0

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VALUE ENGINEERING: A VITAL TOOL FOR IMPROVING COST & PRODUCTIVITY

To face the new business challenges, Companies have to increasingly depend upon the implementation of better management practices. The Practices, which are adopted by them so far for achieving their position in the economy, will need to be reoriented. Business organizations have now to look for innovative ways to cut costs, improved quality and have more customers’ orientation. In this perspective, when the directorial concepts are value and satisfaction. The role of value engineering as cost reduction and control technique becomes vital for an organization. The present paper discusses in detail value analysis/value engineering, as an important tool for reducing the cost. The paper takes an overview of importance of cost reduction and the link between cost reduction and value analysis. The study further takes up the necessity of value engineering in today’s scenario and tells when to apply. In the end of the paper also explains the approach and methodology of engineering. Few examples of corporates have also been provided that have achieved cost reduction by adopting and implementation technique of VE.

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Real-World Examples of Value Analysis and Value Engineering

Adam Kimmel

January 4, 2024

Value analysis (VA) and value engineering (VE) are powerful tools to improve profitability and sustainability that maintain VA/VE cornerstones of function and quality while reducing cost. The concepts are distinct, but even seasoned engineers often use the terms “VA” and “VE” interchangeably. While the phrases are similar and often used together to describe the philosophy, VA and VE have differences that attack different points in a product’s lifecycle. This article explores these differences and provides value analysis and value engineering examples.

What is the difference between value analysis (VA) and value engineering (VE)?

The primary difference between VA and VE is the product lifecycle phase during which the engineering team performs the assessment. For example, value engineering applies to the initial design phase, where a component model may contain features the designer used to illustrate to function crudely. Conversely, value analysis refers to an existing product with at least one complete design and production cycle for insights into potential value improvement opportunities.

Both approaches have their place: 

• VE can improve the profitability of an initial launch that can carry sunk non-recurring engineering (NRE) costs and non-depreciated capital
• VA considers real-world feedback as to which product features the market cares about, which ones complicate manufacturing, and which reduce operating efficiency.

But to understand the difference between VA and VE, it is helpful to leverage examples of each during the product lifecycle.

Value analysis example

Value analysis improves the value ratio (function/cost) by [objectively] analyzing all components of the product cost through a Pareto chart. This analysis includes the manufacturing process cost and proposes ways to increase value or function at the existing cost or remove cost while preserving function and quality.

Optimizing a plastic bottle closure design is an is an example of VA. A commercially-available bottle may have a delivery nozzle that threads onto the bottle and a separate sealing cap that attaches to the nozzle, protecting it from the air that could evaporate the product’s fluid. The cost Pareto may show that the sealing cap is significant to the overall product cost, leading the engineering team to design an integrated sealing cap-nozzle that provides both functions in one component.

This solution would likely require additional tooling for the new shape. Still, it would reduce a significant amount of material by removing a component (also a sustainability win) and the assembly time to place and install the cap. In addition, this design change would reduce manufacturing tolerance stack-ups that could reduce scrap rate or introduce an additional leak path.

Value engineering example

In contrast to the VA approach, which looks at the existing product cost structure, VE targets areas in the initial design that may carry excessive costs into a product launch. The term “cost-avoidance” (instead of cost reduction) refers to the applying a value-based approach at this phase.

Assembling two mature piece parts is an example of VE. A customer may ask the manufacturer to construct the joint between two system components. The initial design may amount to a bolt-on solution accomplished by extending mating flanges to the existing components to attach the parts.

Engineers could run this step through a VE analysis before launch to consider redesigning a more integrated joint, using less material, and potentially recommending a different manufacturing technique to incorporate joints into a single component.

Value analysis and value engineering case study

JCI’s Applied HVAC Equipment division previously used organization-based tools like Sharepoint and emailed static files for VA/VE projects, taking weeks to deliver the ideas. This process is similar to many companies and industries conducting these analyses routinely. As an industry leader, JCI wanted to step up its collaboration by implementing CoLab .

The initial implementation enrolled eight users in a single location; this access has since extended to more than 180 in 4 countries. JCI uses CoLab to cover VE processes like drawing reviews to achieve cost avoidance, and it employs the software for manufacturing process steps and existing products for VA. In addition, they now use CoLab for virtual real-time VA/VE events, pacing the market for efficient collaboration in value engineering and analysis.

VA/VE is not just about cost reduction. Engineers can improve a product’s function or quality profile or enhance profitability to uncover funding for capital or other investment projects. Whether the team is analyzing an initial design to optimize the year-one profitability or collaborating on a production part, it is essential to engage the team efficiently to empower them to generate high-quality ideas quickly.

Applying the principles of VA/VE within CoLab, a platform that smoothly facilitated virtual participation (quadrupling engagement and doubling actionable ideas all tracked within the 3D model), enabled JCI to deliver 8-figure targets in consecutive years.

Visit CoLab's VA/VE page to test drive CoLab software with a guided VA/VE virtual workshop.

Why engineering teams use plm + colab to improve design quality, how do i organize and prioritize design review issues in colab.