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25 shops in the United Kingdom were typically one day long, VE team leader has had similar VE project experience. These whereas workshops in the United Stated tended to be longer-- attributes appear to be most sought after, beyond the Certi- in the 3- to 5-day range. Responses to their survey suggest that fied Value Specialist and PE designations. this may highlight differences in how VE has evolved in the two countries. In the United Kingdom, all team members are involved in workshopping each issue. In the United States, Technical Specialists certain activities in the workshop, specifically the develop- ment phase, are primarily performed in an individual setting. The survey did not explicitly explore the qualifications of the technical specialists. However, some insight can be gained A similar suggestion that VE studies could be shortened from the literature search work. For example, the survey was also discussed by Meyers in "Getting Value Engineer- undertaken during the preparation of NCHRP Report 349: ing Out of the Box" (45). Shorter workshops make senior Maintenance Considerations in Highway Design (46) noted management and unique or specialized expertise more acces- that half of the responding agencies indicated that mainte- sible. Shorter workshops force VE team leaders and owners nance staff was routinely included in VE teams. For the to quickly narrow the scope of the problem. Meyers also sug- remaining agencies, it was noted that maintenance staff was gests that there may be less reluctance to conduct VE studies being consulted regularly on VE studies. This is interesting, if the net scheduling impact is reduced. given that the survey was conducted in 1991, 2 years before OMB Circular A-131 came into effect. One way to reduce the workshop time is to segregate out study components. For example, Meyers suggests that short- Many STAs use either consultant or in-house VE teams, duration workshops only focus on the information, function depending on the project. Virginia exclusively uses in-house analysis, and creativity phases (i.e., the first three phases of team members, whereas California primarily uses consul- the traditional workshop). Hunter and Kelly noted that the tants. FDOT's experiences with hybrid VE team strategies city of New York requires the VE team to prepare Issue were highlighted in "Mixing Consultant Value Engineering Memos following the site meeting (held in advance of the Services with In-House Services--A Value Added Combi- workshop) to identify potential VE workshop targets. nation" (47). It was suggested that the mix of in-house staff and consultants ensured that new ideas were being intro- duced into FDOT. In addition, in-house staff continued to VALUE ENGINEERING TEAM develop as a result of their exposure to external technical expertise. Finally, the insight into the inner workings and The success of any VE study is influenced by the qualities of expectations of FDOT gained by the consultants helped to the VE team, including the VE team leader, and the techni- streamline activities and to develop a better working rela- cal specialists. tionship with each other. Team Leaders WORKSHOP TOOLS AND TECHNIQUES Approximately half of the responding agencies indicated that VM is a process of defined phases. However, when working the VE team leaders were required to be Certified Value Spe- in a specific phase, the VE team leader generally has a great cialists. The other team leaders with credentials, an Associ- deal of flexibility in selecting the "tools" that will be used. ate Value Specialist and the Value Method Practitioners, are The selection of a particular tool is influenced by the nature generally not permitted to lead VE studies. of the product, project, or process under study. The most pop- ular tools identified by the survey respondents included: The majority of respondents indicated that the VE team leader was required to be a professional engineer (PE). It is Cost model--typically a tabulated matrix of project interesting to note that selected agencies made it clear that costs. In some cases, this information may be further VE team leaders do not perform engineering work, when analyzed to identify high-cost elements of the project, facilitating. Nevada includes the phrase "post use of the term unnecessary costs, and high-worth components. `Value Engineering' has resulted in an impression that VE is Evaluation matrix--a numerical model usually incor- an engineering discipline only and that a team of engineers porating factors, criteria, weightings, and rating scores. is required to conduct the studies . . . NDOT now uses the FAST diagram--a graphic model that details the inter- term `Value Analysis'" in its draft policy to address the relationships between project functions. VE/VA issue (9). More that three-quarters of the responding agencies con- It is preferable that the VE team leader have the appropri- firmed that they "always" or "often" use cost models. Sev- ate technical expertise, beyond the required team facilitator enty percent of the respondents reported using evaluation skills. In addition, many responding agencies noted that the matrices during the workshop. Fifty-six percent indicated

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26 that FAST diagrams were used "always" or "often" during inappropriate for many public agencies to use life-cycle cost the workshop. in VE studies, because STAs are not permitted to bank deferred expenditures. Banking deferred expenditures is the It should be noted that just under half of the agencies basis for life-cycle cost. responding indicated that they were using performance mea- sures "always" or "often" during VE studies. However, based The use of risk registers in the United Kingdom is fairly on conversations with AASHTO VE Technical Committee prevalent. However, although the register documents all members, this level of usage appears to be overrepresented potential challenges, the majority of respondents "rarely" use in the survey. This may reflect a misunderstanding on the part it at this time. The risk register defines areas of concern, the of some of the respondents regarding the meaning of perfor- probability of the risk occurring, and the consequences if the mance measures. situation does develop. The VE (or a separate risk) team typ- ically works interactively to create the risk register, taking Traffic models were reported being used "often" by only advantage of multiple perspectives to flush out the details. A about one-third of the agencies. There was no elaboration of sample risk register for a highway project in the United King- the format and content of the traffic models. dom is presented in Figure 10. Economic analysis of the baseline project and VE alter- In recent years there has been a great deal of interest in natives has traditionally been limited to first (capital) costs. project performance measures (PPMs) (50,51). PPMs were In some cases, annual operating costs have been calculated. developed in California from 1995 to 2000 to Several have suggested that user costs, consisting of opera- tional, work zone, maintenance, and delay costs should also Identify key project (scope and delivery) performance be considered (46,48). Until recently, many of these costs criteria for the project, could not be determined appropriately. However, New Jer- Establish the hierarchy and impact of these criteria on sey has recently developed an approach to determine delay the project, and work zone cost impacts for road users (48). Determine the baseline performance of the original concept, In the paper, "Economic Analyses--How to Choose What Determine the performance of one or more competing to Use During Evaluations" (49), it was suggested that it was VE alternatives, and FIGURE 10 Risk register for a transportation project (Courtesy : M. Thompson).

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27 Measure the aggregate difference in performance Other STAs, associations, and international agencies have between the baseline and competitive VE alternatives. become aware of the PPM approach (17), including: Performance measures are being used to illustrate to deci- AASHTO VE Technical Committee, sion makers the effect that the VE alternatives are expected Brazilian Ministry of Transportation, to have on the project in terms of key functionality and cost. Korean Construction Industry, This has helped VE teams respond to management inquiries CSVA, such as "How much better will it work?" and "What trade- Hungarian Society of Value Analysis, offs must we accept to realize the project savings identified?" Japanese Society of Value Engineers, Missouri DOT, and The selection and definition of the performance criteria is Ontario MTO. completed by the stakeholders. Caltrans typically targets for four to eight criteria. A key aspect of the PPM process is the level of discussion with the stakeholders to ensure that the Other STAs, including New Mexico, Virginia, and Washing- criteria definitions are well understood up front. A weighting ton State have developed other forms of performance mea- exercise confirms the relative importance of the criteria in sure assessment (17). Interest in performance measures is terms of the project being studied. A sample PPM summary expected to grow as the AASHTO VE Technical Committee matrix (25) is presented in Figure 11. continues to revise it (17,52). FIGURE 11 Sample Caltrans performance rating matrix (25).