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Value Engineering

Value Engineering. Presentation for: Alaska Department of Transportation & Public Facilities Central Region – Quarterly Design Meeting #40 February 5, 2013. Things I’ve learned in Alaska, so far…. Baker Today. Leader in Engineering & Construction Services 70 + Years Experience

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Value Engineering

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  1. Value Engineering Presentation for: Alaska Department of Transportation & Public Facilities Central Region – Quarterly Design Meeting #40 February 5, 2013

  2. Things I’ve learned in Alaska, so far….

  3. Baker Today • Leader in Engineering & Construction Services • 70+ Years Experience • 2011 Revenue: $538M($499Min 2010) • Recent Acquisitions Focus on Growing Core Engineering Business: • Core Business Segments • Transportation & Civil Infrastructure Engineering • Federal Government - DHS/DoD

  4. Baker Strengths • 3,200+ employees • 100+ office locations • DB Expertise, Experience, & Success • National Alternative Delivery Management (ADM) Group • Strong DOT relationships & experience on large/ complex design projects • Alaska Office Capable of Delivering a Significant Transportation Design Project

  5. Baker Rankings • Engineering News-Record (ENR) • #26 - Top 500 Design Firms • #10 - Top 100 Pure Design Firms • #5 - Bridges • #12 - Transportation • #18 - Top 100 Green Design Firms • #1 - Green Design Multi-Unit Residential Buildings • #12 - Airports • #13 - Water • #24 - CM-for-Fee

  6. Baker Regions & Offices

  7. Alaska • First Alaska office in 1942 • 50 employees • Senior discipline & project management expertise • Smart, eager support staff • Specialty engineering: • Geotechnical • Hydrology & Hydraulics • CADD designer expertise • Permitting & regulatory compliance expertise • GIS mapping & database services Anchorage

  8. Value Engineering is…. …thinking creatively

  9. Value Engineering … Increases Value

  10. Value Engineering What is it? Value Engineering is a systematic application of recognized techniques by a multi-disciplined team which identifies the function of a product or service, establishes a worth for that function; generates alternatives through the use of creative thinking; and provides the needed functions to accomplish the intent of the project.

  11. Value Engineering What is it? • A formal process that identifies components of a project and analyzes their functions • The VE team of multi-discipline experts identify solutions that will satisfy the functions • 80% of a project’s cost can be found in 20% of the items (Pareto’s Law)

  12. Value Engineering • VE began at General Electric Company during World War II due to shortages of skilled labor, materials, and parts. • Lawrence Mills, Jerry Leftow, and Harry Erlicher at GE created what became know as Value Analysis.

  13. Value Engineering • 1970 Federal-Aid Highway Act Authorized the Secretary of Transportation to require VE on Federal-Aid highway projects >$25M, 23 USC 106 (Bridge projects >$20M) • Society of American Value Engineers (SAVE) certifies value specialists who practice VE. Now know as SAVE International • Certification is called Certified Value Specialist (CVS)

  14. Value Engineering What it is not: • A Product or Process Cheapening Procedure • A Critique or Quality Review of a Designer’s Efforts • It is not intended to correct omissions in the design, nor to review calculations made by the designer • Purely a ‘Cost Saving’ Activity • Something We Do Everyday • Routinely Done on all Designs • It does not cut cost by sacrificing needed quality, reliability, or performance. • It is not a part of the normal design process, but a formal cost and function analysis.

  15. Value Engineering • Multi-discipline Team based approach to problem solving • Objective is to achieve basic function of components at the best value • Value is defined as function divided by cost • Follows the VE Job Plan • Functional Analysisforms basis of VE • Action verb and a measurable noun • Pen example

  16. Value Engineering Overview

  17. Value Engineering • Best Time to Perform a VE Study? • Action verb and a measurable noun • Pen example

  18. Value Engineering Phases of the VE Job Plan • Information Phase • Investigate the background information, technical reports, field data, plans and calculations, identification of project components • Functional Analysis • Determine the basic function of the identified components

  19. Value Engineering • Functional Analysis Example • Basic Function is described with two words • Action verb and a measurable noun • Pen example

  20. Value Engineering NASA needed a pen that would work in space. In the 1960’s NASA needed a pen that would work in space. The Russians studied the same problem but didn’t have the funds for expensive pen development.

  21. Value Engineering

  22. Value Engineering Phases of the VE Job Plan • Creative Phase • Creative team brainstorming of alternative methods to achieve the basic function of project components • Evaluation Phase • Analyze design alternatives, life cycle costs, team decides which recommendations to carry forward to next phase

  23. Value Engineering Phases of the VE Job Plan • Development Phase • Development of technical information and cost data to support recommended alternatives • Presentation Phase • Presentation to client on summary of VE Study and recommendations

  24. Value Engineering Example of a Study for AKDOT: • Jim Amundsen, P.E. • Glenn Highway MP 34 – 42 • Being Designed By: HDL

  25. Value Engineering Glenn Highway VE Team Name Discipline Transportation Civil, Highway, Pipeline Highway, Drainage Highway, Drainage Public Involvement Traffic Construction Civil, Highway Right-of-Way • Jerry Oshesky, P.E • Shawn Snisarenko, P.E. • Derek Christianson, P.E. • RaeAnne Hebnes, P.E. • Bonnie Pfuntner • Gary Katsion, P.E. • Josiah Clayton • Ken Chapman, P.E. • Steve Carlson, MAI

  26. Value Engineering • Thur. Oct. 4 - Design Overview Meeting by HDL • Mon. Oct. 8 – Site Review/Project Info Review • Tues. Oct. 9 – Functional Analysis/Creative Phases • Wed. Oct. 10 - Evaluation/Development Phases • Thur. Oct. 11 - Development Phase/Presentation Prep • Fri. Oct. 12 – Presentation • Fri. Oct. 19 – Summary Report Completed

  27. Value Engineering High Cost Components • Earthwork (10%) • Pavement and Base (16%) • Reinforced Embankment (3%) • Traffic Control (3%) • Signals (10%) • Utility Relocation (7%) • Right of Way (19%) • Lighting (5%) Project Design, Construction, and Right of Way $100,617,464

  28. Value Engineering Findings: • 32 VE Proposals • 13 VE Recommendations • General Design Considerations • 7.2 % of Total Project Cost • Total Potential Savings $7.2 M Accepted/Implemented: • Accepted Proposals $2.8 M

  29. Value Engineering

  30. Value Engineering VE Information on the Web • SAVE International at http://www.value-eng.org/ • FHWA http://www.fhwa.dot.gov/ve/ • Jerry Oshesky, P.E. • goshesky@mbakercorp.com • 907-273-1645

  31. Value Engineering Thank You Questions?

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