Amin Terouhid, Ph.D., CVS

Maryam Mirhadi, Ph.D.

Executive takeaway. Value engineering (VE) is a structured team process for finding better ways to meet a project’s needs. VE studies need to be conducted when the VE team has enough information to compare meaningful alternatives and enough time to implement the findings before major commitments. A design-completion percentage alone cannot establish that balance.

Match the study to the decision

SAVE International characterizes the VE process as a systematic process involving several disciplines and a qualified facilitator. Its emphasis on identifying required functions gives owners a useful starting point: define what the project must accomplish before choosing how to accomplish it. [1]

To determine when owners should conduct VE studies, it is helpful to review the typical phases through which projects are progressed. Concept development establishes needs and broad approaches. Schematic design turns the selected approach into preliminary layouts. Design development refines dimensions, materials, and coordinated building systems.

The Federal Highway Administration (FHWA) advises conducting VE once sufficient information is available and explains that no single best time applies to every project. Earlier studies retain broader choices but depend on less-developed information; later studies permit more detailed comparisons while facing more commitments. The useful study window depends on the decisions being evaluated. [2]

The table below identifies the main development stages in projects and describes which VE decisions are typically suitable for each stage.

Milestone	Available information	Suitable VE decisions
Concept development	Needs, site constraints, broad cost ranges	Site strategy, facility size, major alternatives
Schematic design	Layouts, preliminary systems, initial estimates	Space efficiency, system types, access
Design development	System sizes, materials, coordinated drawings	System configuration, materials, maintenance access
Preconstruction	Detailed drawings, bids, supplier terms	Targeted alternatives, installation methods, sequencing

The VE decisions are typical recommendations, not mandatory phase requirements.

This table illustrates how the scope of a VE study may change as the design progresses. During concept development and schematic design, the team can examine broad alternatives, such as changing the facility layout or selecting a different building system. During design development and preconstruction, the study generally becomes more focused on improving particular systems, materials, or construction methods. The owner should therefore begin by identifying the decisions the study is intended to influence and determining when those decisions will become difficult or costly to change.

The information needed should correspond to those decisions. Comparing alternative layouts requires an understanding of space needs, access, and operating requirements, but may not require detailed equipment selections. Comparing heating and cooling systems requires more specific information about building demands, operating hours, energy use, and maintenance needs.

Waiting for every design detail to be resolved can unnecessarily delay a study; proceeding without information essential to the decision can produce recommendations that cannot be supported. Where uncertainty remains, the team should identify its assumptions and explain whether additional information could change the preferred alternative.

Leave time to turn recommendations into changes

Having enough information is only one part of choosing the right milestone. The study must also finish early enough for its recommendations to be evaluated, approved, and incorporated into the project.

For example, changing the location of major equipment may require revisions to structural supports, electrical connections, and maintenance access. Those revisions involve additional design work and coordination. If equipment has already been ordered, the change may also involve cancellation charges or a different delivery date. Likewise, changes to a design submitted for a permit may require further review by the approving authority.

A practical approach is to work backward from the earliest commitment affected by the proposed study. Allow time for the workshop, technical evaluation, owner approval, design revisions, and any necessary purchasing or permitting changes. This helps establish when the study must begin and whether its anticipated benefits justify the effort required to implement its findings.

Apply the approach to an actual decision

Consider a hypothetical public building project in which heating and cooling equipment must be ordered before the remaining design is finished. If the owner waits for a later overall design milestone, the opportunity to select a different system may already have narrowed.

A better approach is to evaluate the system once the building’s heating and cooling demands, operating requirements, and feasible equipment options are sufficiently understood, while leaving time for approval before the order is placed. The comparison should address both required performance and life-cycle cost—the combined costs of purchasing, operating, maintaining, and replacing the system over the period being evaluated. This approach allows the owner to assess whether an alternative offers lasting value rather than merely a lower purchase price.

If essential information is still missing, the team can first identify promising alternatives and the information needed to evaluate them, then complete the comparison before purchasing. The study’s timing follows the decision and its information needs, rather than an arbitrary percentage of overall design completion.

Revisit the timing when circumstances change

Owners should also reconsider the need for a study when circumstances change. Examples include when a revised estimate exceeds the budget, operating needs change, site investigations reveal new constraints, or equipment delivery times threaten completion. These developments can justify a focused review even if an earlier VE study has been completed.

As a management recommendation, each proposed study should identify the decision to be influenced, the information needed, the people authorized to approve changes, and the last practical date for implementation. Any applicable agency, funding, or contractual requirements should be evaluated separately. Together, these steps help owners commission VE when its findings can still improve project outcomes.