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VE General Knowledge

Procedure for cost allocation

http://adamslandscapesupply.ca/gallery/oaks-persidio/ Split the product into components and service/system into activities. Define functions of components/activities. Divide the total cost of product/service/system into components/activities cost. Processes performed to achieve particular function; cost allocated to that function. Component provided to achieve particular function; cost allocated to that function. Component accomplishes more than one function; allocation should be based on […]

VE General Knowledge

Concept of worth

see url 1. Worth is the minimum cost of achieving a function. 2. Worth is an indispensable element of VE. 3. Worth varies with time. 4. Worth depends upon information. 5. Worth is usually determined by developing or thinking of other methods of performing functions. 6. Worth is just a technique, not an absolute value. 7. Where […]

VE General Knowledge

What is the Value of the Value Index?

The primary objective of function analysis is to find the functions/areas of the project that have the best opportunity to improve value, or in other words which functions should be worked on in the creative phase. The early VA/VE pioneers like Larry Miles and Carlos Fallon discussed the worth of functions. Later it seems that […]

VE General Knowledge

Essential Features of Project Value Management

‘‘Project value’’ refers to the relationship between the needs of different project stakeholders and the resources used to satisfy them. What constitutes project value, however, can be hard to pin down, because different stakeholders have different views. The challenge of value management is to understand and reconcile these differences. Essentially, value management focuses on enhancing […]

VE General Knowledge

Belief in the Importance of Value

(This excerpt is from Larry Miles book, Techniques of Value Analysis and Engineering, page 270.) Starting with certain native inclinations and modified by childhood and business experience, any person develops interest in certain lines and disinterest in others. In essentially all cases, human beings are interested in food, although in some cases of unusually unfortunate environments, […]

VE General Knowledge

Major Decision Makers

Major Decision Makers

This Figure , “Major Decision Makers’ Influence on Facility Costs,” shows whose decisions have the most influence over the expenditure of funds during the life cycle of a facility. The owner and consultants are the major decision makers. To ensure optimal results, it is essential to involve the owner and consultant in the VE process. […]

VE General Knowledge

FAST Diagram, (as is) or (to be)?

As we are going to create FAST diagram, the concept describes the method being considered, or elected, to achieve the basic function(s). The concept either represents the current conditions (as is) or proposed approach (to be). It is always good to create a “to be” rather than an “as is” FAST model, even if the […]

VE General Knowledge

Pump Total Life-Cycle-Cost (LCC)

Pump Total Life-Cycle-Cost (LCC)

Life-Cycle-Cost is Sum of all recurring and one-time (non-recurring) costs over the full life span or a specified period of a good, service, structure, or system. It includes purchase price, installation cost, operating costs, maintenance and upgrade costs, and remaining (residual or salvage) value at the end of ownership or its useful life, (www.businessdictionary.com) According […]

VE General Knowledge

Bytheway 9 Questions

Bytheway 9 Questions

In his article “FAST Diagrams” in 1970, Mr. Bytheway points out that the questions used in developing a FAST Diagram are “subject oriented as well as creatively oriented and provide (for the analyst) countless motivations for creativity”. The FAST procedure the is a technique using nine “thought-provoking questions” which are shown in the following figure.