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Introduction

Concept of Value

In construction, value links the functions a project must perform with the resources required (cost, time and risk) to deliver those functions (Kelly et al., 2014).
Value goes beyond lowest initial cost and includes quality, performance, sustainability and whole‑life cost from the client and user perspectives (Imperial College London, 2017; Kelly et al., 2014).

Figure 1. Overview of value assessment as defined in BS EN 12973:2020 (RICS, 2021).

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Introduction

What is value management?

BS EN 12973:2020 Value management states that value management is ‘all about organisational improvement, setting clear goals, improving productivity, certainty and return on investment’.
Value management is a formal, systematic, team‑based methodology that uses function‑oriented thinking to improve value in projects, products and processes (Tohooloo, 2017; Praxis Framework, 2023; RICS, 2021).
Contemporary value management emphasises wider outcomes such as stakeholder satisfaction, innovation, risk reduction and whole‑life performance, not just cost cutting (Tohooloo, 2017; Kelly et al., 2014; RICS, 2021).

Figure 2. VM interventions (Tohooloo, 2017)

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Objectives of Value Management

Clarify and prioritise client and user needs, functions and project objectives at an early stage (Tohooloo, 2017; Praxis Framework, 2023; RICS, 2021).

Achieve best value for money by balancing time, cost, quality, risk, sustainability and whole‑life performance (Imperial College London, 2017; Tohooloo, 2017; Kelly et al., 2014).

Improve communication, collaboration and decision‑making among project stakeholders (Tohooloo, 2017; RICS, 2021).

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Value Management in Construction Practice

High value / High risk – Strategic critical

Management approach:

Early value management studies and options appraisal.
Strong stakeholder involvement and rigorous risk management.
Collaborative contracts, close monitoring, senior decision‑making.

Low value / High risk – Strategic security

Management approach:

Focus on risk reduction and compliance rather than cost cutting.
Clear specifications, approvals and inspections.
Ensure backup options and contingency plans.

Figure 3. When should value management be applied? (Bennett and Mayouf, 2021).

Horizontal (value)

High value: big impact on project objectives (cost, time, quality, safety, whole‑life performance).
Low value: relatively small impact; easier to replace or change.

Vertical (risk)

High risk: high uncertainty or potential for serious problems (technical, commercial, programme, H&S, stakeholder).
Low risk: predictable, routine, well‑understood.

High value / Low risk – Tactical profit

Management approach:

Use value management to improve efficiency and standardisation.
Drive whole‑life value (better detailing, fewer defects) with controlled experimentation.
Seek productivity gains, off‑site fabrication, long‑term framework agreements.

Low value / Low risk – Tactical acquisition

Management approach:

Simplify: standard specifications, bulk buying, simple contracts.
Minimal value‑management effort; keep transaction costs low.

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Value Management in Construction Practice

The intensity of value management should be aligned with both the risk level and the value of the project or project element.
Activities that are high value and high risk merit comprehensive, workshop‑based value management with strong stakeholder participation, as they can significantly influence project outcomes.
In contrast, low value and low risk items generally do not warrant extensive value management effort, since the potential gains are limited. These are often appropriately addressed through desktop value management, involving analysis and review by a small team rather than full collaborative workshops.
This differentiation highlights that stakeholder integration is a core component of value management, but the extent of involvement should be tailored to the significance of the decision.

Figure 3. When should value management be applied? (Bennett and Mayouf, 2021).

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Value Management in Construction Practice

In construction, value management workshops often consider issues such as layout efficiency, structural systems, building services options and specification levels (Tohooloo, 2017; RIB Software, 2025; Kelly et al., 2014).
Whole‑life cost and sustainability (for example, maintenance, energy use, adaptability) are central when comparing alternative design solutions (Imperial College London, 2017; Tohooloo, 2017; Kelly et al., 2014).
Value management can be integrated with digital tools such as BIM to support collaborative exploration and evaluation of design options (Tohooloo, 2017; Kelly et al., 2014; RICS, 2021).

Figure 4. Key opportunities for value management and value engineering throughout the project lifecycle (RICS, 2021).

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Typical Value Management Process

Orientation and preparation: define study objectives, scope, participants and information needs

Information and function analysis: understand the current proposal, break the project into components and functions, and assess their contribution to overall value

Speculation (creative stage): generate a wide range of alternative ideas to deliver required functions more effectively

Evaluation and development: assess ideas against criteria such as cost, performance, risk and constructability, then develop the best options

Presentation and implementation: present recommendations, agree actions and integrate chosen options into design, procurement and construction

Review and follow‑up: monitor implementation, measure outcomes and capture lessons learned for future projects.

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Value Management Case Study

Scenario: Value Management in Pizza Hut UK (Construction Excellence, 2015)

In early 1997, Pizza Hut was anticipating a programme of 25 refit projects (Pizza Delivery Units) at an estimated/budget value of £145,000 each, amounting to a programme value of over £3.5 million.

In order to review the projects before going on site, a series of three half-day value management workshops was convened comprising client representatives (Area Manager and Property Manager) and the consultants (Designer, QS and Services Engineer).

The workshops were facilitated by an experience value management facilitator from outside the project team. The three workshops followed a traditional format of information exchange, functional analysis, brainstorming of alternative solutions, evaluation of preferred alternatives, acceptance and implementation. As a result of nine hours of workshop and a similar amount of work outside the workshops by members of the team, a total of £14,000 per project was saved, equivalent to £350,000 capital cost on the whole programme.

In some areas standards were actually raised, and longer-term maintenance was reduced. A shorter contract period was also established and shorter delivery times for certain long lead items. The total cost of the value management exercise was estimated at less than £10,000, giving a return of 35:1 on the investment.

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Value Management Case Study

VM stage	What this stage means	What this looked like in the Pizza Hut case
Information	Build a shared, factual understanding of the project: scope, budget, constraints, standards and programme.	Three half‑day workshops started with information exchange between the Area Manager, Property Manager, designer, QS and services engineer about the planned refits (25 units at about £145k each, total over £3.5m)
Function analysis	Clarify the functions the project must perform before discussing specific design or specification solutions.	The team examined what each part of the refit needed to achieve (e.g. brand image, throughput, kitchen efficiency, hygiene, durability) rather than jumping straight to particular fittings or layouts.
Creativity / brainstorming	Generate a wide range of alternative ways to deliver the required functions, suspending judgement initially.	The workshops included brainstorming of alternative design, layout, specification and procurement options that could deliver the same or better functions at lower cost or with additional benefits.
Evaluation	Assess and compare options against agreed criteria such as cost, quality, time, risk and maintenance to select preferred solutions.	The team evaluated the brainstormed options, estimating their cost and programme effects, and chose preferred alternatives that offered savings or other value improvements.
Acceptance & implementation	Obtain agreement from decision‑makers and build selected options into project documentation and delivery.	The client representatives accepted the preferred alternatives and implemented them across the 25‑project programme, leading to standardised, improved solutions and consistent savings on each refit

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Value Management Case Study: Cost and ROI calculations

Non‑cost value improvements (Benefits beyond direct cost savings mentioned in the case)

Higher standards in some areas

In certain aspects (e.g. finishes, equipment or layout) standards were raised, showing that VM is about improving value, not just cutting cost.

Reduced long‑term maintenance

Choices made in the VM process reduced future maintenance needs, improving whole‑life performance and lowering operating costs over time.

Shorter contract periods

The refit contract period was shortened, meaning less disruption to operations and quicker return to full trading.

Shorter delivery times for long‑lead items
Delivery times for key long‑lead items were reduced, which helps programme reliability and reduces the risk of delay.��

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Benefits & Limitations of Value Management

Benefits

Enhances value for clients and end‑users by aligning project outcomes with needs and priorities.
Can deliver cost savings and improved affordability while maintaining or improving performance and quality.
Supports productivity, reduces changes and rework, and leads to more predictable time and cost outcomes with stronger stakeholder relationships.

Limitations

Value management requires time, preparation and skilled facilitation; poorly planned workshops may add cost without clear benefits.
If seen as a late cost‑cutting exercise, value management can face resistance from designers and contractors.
Achieving full participation from all key stakeholders can be difficult, especially on fragmented or fast‑track projects.

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Group-assessment Task

Scenario

A Welsh local authority is planning a programme of 20 secondary school science‑block refurbishments under a Welsh education capital programme. The estimated budget per refurbishment is £1.8 million.

The aims are to improve the learning environment (lighting, ventilation, flexible labs), upgrade building fabric and services to reduce energy use and maintenance, and standardise layouts and equipment to simplify future maintenance and teaching delivery.

Due to budget pressures from other commitments (e.g. flood and coastal risk schemes and highways upgrades in Wales), the council must reduce capital costs or some refurbishments will be delayed.

The council decides to run a series of value management workshops (Two half‑day VM workshops) are held before tendering, involving:

Client: Head of Education, Council Property Manager, two school headteachers.
Consultants: Architect, M&E engineer, QS, sustainability adviser.
Independent VM facilitator from outside the project team.

The total VM exercise cost (facilitation + professional time) is £45,000. And after VM, the average cost per school is reduced by £180,000, while still achieving key educational and sustainability objectives.

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Group-assessment Task

TASK A:

Map the value management process to the Welsh case

VM stage	What this stage means (in your words)	What this looks like in the Welsh school case
Information
Function analysis
Creativity / brainstorming
Evaluation
Acceptance & implementation

TASK B:

Calculate:

Programme value before VM.
Total cost saving.
Percentage saving per project.
The ROI (saving : cost) for the VM exercise.

TASK C

List at least four non‑cost benefits that could arise from this VM process in a Welsh education programme,

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References/Bibliography

Bennett, K. and Mayouf, M. (2021) ‘Value Management Integration for Whole Life Cycle: Post COVID-19 Strategy for the UK Construction Industry’,. Sustainability, 13(16), pp. 9274. Available at: https://doi.org/10.3390/su13169274 (Accessed: 15 December 2025).
Construction Excellence (2015) Value management. Available at: https://constructingexcellence.org.uk/wp-content/uploads/2015/03/value.pdf (Accessed: 15 December 2025).
Designing Buildings Ltd. (2012) Value management in building design and construction. Available at: https://www.designingbuildings.co.uk/wiki/Value_management_in_building_design_and_construction (Accessed: 15 December 2025).
Imperial College London (2017) Value management (stages 1 to 6). London: Imperial College London Estates. Available at: https://www.imperial.ac.uk/estates-projects/project-procedures/processes/project-management/value-management/ (Accessed: 15 December 2025).
Kelly, J., Male, S. and Graham, D. (2014) Value management of construction projects. 2nd edn. Chichester: Wiley‑Blackwell.
Office of Government Commerce (2007) Value management in construction. London: The Stationery Office.
Praxis Framework (2023) Value management. Available at: https://www.praxisframework.org/en/library/value-management (Accessed: 15 December 2025).
Procore (2025) Value engineering in construction: 6 steps to increase project value. Available at: https://www.procore.com/library/value-engineering (Accessed: 15 December 2025).
RIB Software (2025) Value engineering in construction: learn its importance. Available at: https://www.rib-software.com/en/blogs/value-engineering-in-construction (Accessed: 15 December 2025).
RICS (2021) ‘Getting value management right’, RICS Construction Journal, August. Available at: https://ww3.rics.org/uk/en/journals/construction-journal/getting-value-management-right.html (Accessed: 15 December 2025).
Tohooloo, Y. (2017) Value management in construction: the process and benefits. Available at: https://www.linkedin.com/pulse/value-management-construction-process-benefits-yashwant-tohooloo/ (Accessed: 15 December 2025).