Get Improving Profits Through Prime/subcontractor Value Engineering

An engineering change proposal (ECP) is a formal request to modify the design or specifications of a product or system. It is typically used in engineering and manufacturing environments to document and track proposed changes and to obtain approval from relevant stakeholders for those changes.

Value engineering is often broken into six stages: information gathering, brainstorming, evaluating, developing plans, presentation, and implementation. The phases range from collecting relevant data to designing alternatives to see what management thinks of the potential changes.

A VEP is a Contractor developed proposal that is submitted to the Department. A VEP is an opportunity for the Contractor to make an innovative change that will provide value to the project once it has started. An approved VEP splits the savings 50/50 between the Department and the Contractor.

17.101 Authority. This subpart implements 41 U.S.C. 3903 and 10 U.S.C. 3501 and provides policy and procedures for the use of multi-year contracting.

Value Engineering Clause appears in FIDIC suite of contracts which states that “the Contractor may, at any time, submit to the Engineer a written proposal which (in the Contractor's opinion) will, if adopted, (i) accelerate completion, (ii) reduce the cost to the Employer of executing, maintaining or operating the ...

Value Engineering Change Proposal. Value Engineering Change Proposal (VECP) is a proposal submitted by a contractor under the Value Engineering (VE) provisions of the Federal Acquisition Regulation (FAR) (FAR Part 48) that, through a change in the contract, would lower the project's life-cycle cost to DoD.

The Contracting Officer must ensure that all the prime's subcontracts have been paid and closed before the prime contract can be eligible for Contract Closeout.

Value engineering analyzes designed building features, systems, equipment, and material selections to achieve essential functions and enhance results while reducing the life-cycle cost. Value engineering practices are formally structured in the design phase and depend on contractor initiative in the construction phase.

Value engineering attempts to eliminate, without impairing essential functions or characteristics, anything that increases acquisition, operation, or support costs. There are two VE approaches described in FAR Part 48, the "incentive" (also known as voluntary) and the "mandatory program."