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32 CHAPTER FOUR IMPLEMENTATION AND MONITORING IMPLEMENTATION Virginia noted that the agency also uses an appeals pro- cess. The VE report is forwarded to all of the discipline man- The VE Job Plan establishes a sequence of activities that agers that will be affected if the recommendation is accepted. have been proven to successfully improve a product, project, All comments are synthesized by the regional VE manager or process. However, no similar sequence of activities has and forwarded to the chief engineer for program develop- been uniformly adopted to implement the proposed VE ideas. ment. The chief engineer has the final authority, but may The different team roles--design and VE--have tradition- consider an appeal supported by the appropriate justification ally (and in some jurisdictions legally) required a complete materials. separation of the design and value activities. This can lead to a potentially adversarial relationship if human relations are California's process includes three steps--(1) review VE not respected during the VE study (2). alternatives, (2) resolve alternatives, and (3) present results. The entire VE team is involved in the meeting. A written Miles (4) first cautioned during his first VA training work- record regarding resolution (some agencies refer to this as shop group in 1952 that this segregation of roles could lead disposition) of the VE alternatives identifies whether the VE to the "competitor instinct." It is common practice to have the proposal was accepted, modified and accepted, or rejected. designer complete the initial review of the VE proposals and Resolution of each idea is based on the validation of the advise the STA of how they should be addressed (i.e., accept, accepted results. modify and accept, or reject). The majority (almost 60%) of the responding transporta- MONITORING VALUE ENGINEERING IDEA tion agencies indicated that some form of defined implemen- IMPLEMENTATION tation strategy was in place for their VE programs. In many cases, an implementation or design review meeting is held Implementation of the VE proposals is the only way to truly following the VE workshop to consider the proposed VE determine the total impacts and costs. The initial effort made ideas. For example, Michigan convenes a meeting immedi- during the development phase of the Job Plan is intended to ately following the workshop with the VE and design teams. refine and confirm the cost estimates. Monitoring idea imple- The combined group considers the disposition of each idea mentation can promote a greater understanding of the impacts. by deciding on one of three outcomes: There are two aspects of monitoring that must be Accept for implementation into design, considered: Accept for further study, or Reject and list specific reasons. Confirming that the idea was included in the design and Developing a better understanding of the true impacts New York State used a similar process; however, it per- and costs. mits the regional VE office to conditionally accept the rec- ommendation for further study, but defer the final decision to As discussed earlier in this report, FHWA is required to the main office. report the VE activities on an annual basis. STAs must provide supporting information on the VE proposals in terms of cost. The implementation process must confirm who is respon- sible to make the decision, define a response time frame, and MONITORING VALUE ENGINEERING PROGRAM manage stakeholder and political expectations as well as sen- PERFORMANCE sitivities. The process may necessitate different implementa- tion team compositions to suit the idea being evaluated. For Monitoring VE program performance ensures that expen- instance, the design branch would likely defer to the con- ditures and effort to deliver the program are well under- struction branch of the agency if the VE idea was a construc- stood. Sixty-four percent of the responding STAs monitor tion idea. program expenditures and avoided costs to develop a Return-

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33 FIGURE 13 Sample VE program performance measures summary report for Washington State DOT (65 ). FIGURE 14 Sample return on investment summary report for New Mexico (66).

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34 on-Investment (ROI) report. This report is only one of the In addition to the FHWA-required program results, sev- metrics measured. Other measurements include: eral transportation agencies, including California, Missouri, New Mexico, Virginia, and Washington State, have now begun Number of VE studies performed, to measure nonmonetary results. Figures 13 and 14 present Cost of the VE studies, the program results for Washington State (VE performance Estimated project costs, measure for 20012003) and New Mexico (performance-based Number of VE recommendations, budget measure), respectively. Value of VE recommendations, Number of approved recommendations, Value of approved recommendations, and In Florida, program performance is measured as a per- VE change proposals. centage of the annual VE work plan. Ontario follows up with VE workshop participants after a workshop to obtain These are the program metrics that must be submitted timely feedback. Arizona develops a benefit-cost ratio for to FHWA. its program.