Value engineering without cutting corners

Value engineering is supposed to take money out of a construction project while your scope and quality stay exactly where they were. Run properly, and run early, it does that. Run late, as a scramble on site to claw back an overspend, it stops being value engineering and turns into cutting corners with a tidier name.

I have costed and run building projects out of Stockport since 1992. The version of this exercise I trust least is the one that turns up too late to do any good.

So what is value engineering, really?

Value is a ratio. RICS defines it as the benefit a project delivers set against the cost and effort of getting there. Value engineering is the disciplined work that improves that ratio: you keep the function the client actually needs, and you find a cheaper way to deliver it. The idea is not new. Lawrence Miles worked it out at General Electric in the 1940s, when wartime shortages forced substitutions and half of those substitutes turned out to perform just as well for less. The British and European standard, BS EN 12973, still frames everything around function rather than price.

That word, function, is the whole game. A handrail has to stop someone falling and feel solid under the hand. Whether it is solid oak or a well detailed engineered timber does not change what it does. One of those swaps is a real saving. Swapping it for a rail that flexes and fails its loading test is not. That is a defect you have not been billed for yet.

When does a good idea turn into cutting corners?

Timing is the whole answer.

The RIBA Plan of Work splits a project into stages. Stage 2 is concept design, Stage 3 is spatial coordination, Stage 4 is technical design. The cheapest place to change your mind is Stage 2, on paper, before anything has been detailed or ordered. RICS research puts hard numbers on why. The client and the early consultants account for only about 5 per cent of a project's cost, yet the calls made at that point influence up to 65 per cent of what it will finally spend. The design team is roughly 10 per cent of the cost and steers about a quarter of it. Almost all of your influence sits at the front.

So a genuine value engineering exercise happens while the drawings are still soft. A substitution proposed at Stage 4, or worse once the steel is on order, is a different animal. By then you cannot change the function cheaply, so the only lever left is quality. That is the moment value engineering becomes the phrase a project uses to describe quietly buying worse things.

The test I put every substitution through

When a contractor brings me a cheaper alternative, I ask one thing before I look at the price. Does it still do the job on this site, for the life the client is paying for? If the answer holds, it is a real saving and I will push hard for it. If it only holds on the datasheet, it is a corner.

I learned that the expensive way. The cheapest cladding substitution I ever signed off looked identical on paper and cost noticeably less. It weathered badly on an exposed elevation inside two winters, and the client remembers the staining, not the money we saved on day one. Now I test every substitution against how the material behaves here, on a wet, wind-driven site, before I ever get to what it saves to buy. A saving that comes back as a repair bill was never a saving.

How much does value engineering actually save?

Less than the headline promises, and more reliably than the panic version. Public sector value engineering programmes in the United States, where the discipline is measured formally, average around 3 to 5 per cent of total investment cost. On the commercial projects we run, a proper exercise carried out early tends to land between 5 and 15 per cent, and it depends almost entirely on how loose the original design was. A tightly designed scheme has little fat to trim. Anyone promising you 30 per cent is either working from a wasteful starting point, or is about to remove something you will later miss.

Here is the number people forget. Preliminaries, the cost of simply running the site and keeping it safe, commonly sit at 10 to 15 per cent of a construction budget. Shorten the programme by a month with a smarter sequence and you have value engineered real money without touching a single specification. That is the saving I chase first, because nobody's building gets worse when the site is run for less time.

What this looks like on a Greater Manchester site

Round here the biggest value engineering battles are fought underground, before anyone argues about finishes. Greater Manchester builds on its own industrial past. A large share of the land coming forward, especially across the roughly 2 billion pound town centre regeneration the Stockport Mayoral Development Corporation is driving, is former mill and works land. Brownfield. That means ground remediation, old foundations, buried tanks and made ground of unknown depth, and it is the most volatile line in any early budget.

The temptation is to value engineer the ground investigation, to sink fewer boreholes and hope. That is the one place I will not let a client save. A skipped survey is not a saving, it is a bet, and made ground on a Stockport mill site tends to collect on that bet during the wettest groundworks you can picture. The Pennine fringe weather does not read your programme.

Above ground, the local stock sets its own limits. Schemes like the Weir Mill conversion, part of the same regeneration that delivered the new Stockport Interchange in 2024, are listed Victorian structures. You cannot value engineer a listed frame or a retained facade, and pretending otherwise is how a project ends up in front of the conservation officer with a redesign bill. The honest move is to accept what is fixed and find the value in everything around it.

How we approach value engineering at Spring & Co

We run it as a scheduled workshop, not a running argument on site. It sits inside our cost management and quantity surveying work, and we bring it in during early design while the cost plan can still move. Function first, options priced against whole-life cost, and every accepted change written down so nobody can quietly reinterpret it later as licence to fit something cheaper.

Because we also act as the CDM Principal Designer on many schemes, safety stays in the room while the savings are found. The Construction (Design and Management) Regulations 2015 make buildability and safe maintenance a design duty, so a clever looking saving that leaves a roof harder to clean for the next 30 years fails that duty. A saving that ignores the CDM 2015 duties is not really a saving. It is a future problem with a discount attached.

The clients who get the most from this bring us in before the design is fixed, alongside our project management and construction management teams. Come to us at Stage 2 and we can build the value into the scheme. Come to us after the tender returns high, and we are down to the same blunt choices as everyone else.

Common questions about value engineering

Does value engineering always reduce quality?

No. Done properly it holds quality and function and takes out cost, by finding a cheaper route to the same result. Quality only drops when the exercise starts too late, after the design is fixed, when the one thing left to cut is the specification itself.

When is the best time to value engineer a project?

During early design, around RIBA Stage 2 to 3, while the drawings and the cost plan can still change cheaply. That is where most of the influence over final cost sits, so that is where an hour of effort saves the most.

Can you value engineer a listed building?

Only around the parts that are not protected. On a listed Stockport mill you cannot touch the retained structure or facade, so the value has to come from the new build, the services and the internal fit out. Trying to save on the protected fabric usually costs more once the conservation officer is involved.

If you are planning a project and want the cost taken out at the point it actually helps, talk to us early. Speak to the Spring & Co team or call our Stockport office on 0161 476 4456, and bring us in while the drawings are still soft.