Ain Shams Engineering Journal 10 (2019) 471–479

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Ain Shams Engineering Journal

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Architectural Engineering

Examining the role of value management in controlling cost overrun

[application on residential construction projects in Egypt]
Laila M. Khodeir a,⇑, Alaa El Ghandour b
a
Faculty of Engineering, Ain Shams University, The British University in Egypt, Egypt
b
Technical Architect, Faculty of Engineering, Ain Shams University, Egypt

a r t i c l e i n f o a b s t r a c t

Article history: Actual cost of construction projects generally differs from planned cost, where this could reach a value
Received 27 August 2018 between 21% and 55%. In Residential construction, cost overruns form a crucial problem. A suggested
Revised 16 October 2018 methodology to mitigate this problem is Value Management (VM), which has proven to be an effective
Accepted 20 November 2018
approach. Thus, the main objective of this paper is to examine the role of VM in Controlling Cost
Available online 15 February 2019
Overrun, with special reference to Residential Projects in Egypt. A literature review was applied on the
basics of project cost implementation. In addition, a qualitative analysis of case studies was performed.
Keywords:
Finally, a questionnaire survey that assessed the impact of applying VE on Residential projects in Egypt
Cost management
Residential Construction
was performed. Findings of this paper highlighted the value added from applying Methodologies of VM,
Value management where it was observed that it could achieve 15–40% savings of the total project cost.
Cost overrun Ó 2019 The Authors. Published by Elsevier B.V. on behalf of Faculty of Engineering, Ain Shams University.
This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-
nd/4.0/).

1. Introduction budget”. Cost Overrun is also referred to as ‘‘Cost Escalation”, ‘‘Cost

The commonly known definition of the term ‘‘Project Cost” is
the financial sum needed to accomplish the production of
construction-related products; for example, buildings. The cost of
any building contractor-related project is a representation of all
those items under the name of ‘‘expenditures”. In general, project’s
cost is determined by quantitative assessments of the expected
sum amount of resources required to accomplish all necessary
activities; labor, materials, supplies, etc. [1]. Thus, the project’s cost
is all about the amount of cash that is to be paid for the sake of
completion of all activities concerning this particular project. Mov-
ing on to cost overrun, it can simply be estimated by dividing the
change in the contract amount by the contract award amount.
Therefore, Cost Overrun = Final Actual Cost
Original Estimated
Budget Cost. It can also be defined as ‘‘excess of actual cost over
⇑ Corresponding author at: Department of Architecture Engineering, Ain Shams
University, The British University in Egypt, Egypt.
E-mail addresses: Drlailakhodeir80@gmail.com, Leila.mohammed@eng.edu.eg
(L.M. Khodeir).
Peer review under responsibility of Ain Shams University.
Production and hosting by Elsevier
Increase”, or ‘‘Budgets Overrun” [2].
This paper is mainly concerned with control processes of the con-
struction projects cost overruns. The main objective of this paper is
thus to examine the role of Value Management (VM) in controlling
such overrun, with special reference to residential projects in Egypt.
In addition, the paper attempts to identify the determinants and
basis of the total cost of implementing such type of projects, that
can help in reducing the gap between the estimated/planned time
and actual time and cost of residential constructional projects
implementation. This paper suggests the usage of value manage-
ment approach which is based on structured steps and phases that
finally aim at reaching a fair balancing of cost and quality.
The methodology adopted throughout this paper is explained in
Fig. 1, which includes 3 main phases including literature review,
analysis of examples and finally the application of a survey
questionnaire.
Historically, value management emerged in the United States of
America as a result of running out of materials used in manufactur-
ing during World War II. Mr. Lawrence Miles (founder of Value
Management, then known as Value Analysis) of General Electric
was hugely responsible for this technique’s creation in 1942, and
since then it has been a preferred method in a wide range of indus-
tries. Currently, the US government and other countries as the UK,
Australia, KSA, Japan, and Korea rely on the ‘‘Value Management ”
among other countries, and it is expected that such technology will
have a vital role within capital projects [3].

https://doi.org/10.1016/j.asej.2018.11.008
2090-4479/Ó 2019 The Authors. Published by Elsevier B.V. on behalf of Faculty of Engineering, Ain Shams University.
This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).
472 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479
Fig. 1. Methodology of the paper. Source: Authors.
2. Literature review
The first step towards achieving the aim of this research is
undergoing a comprehensive literature review of recent researches
that dealt with the concepts of cost overruns, Value management
and the significance of residential construction projects in Egypt.
2.1. Defining cost overrun
The term ‘‘Cost Overrun” can be defined as the state when:
‘‘when the final cost of the project exceeds the original estimates”
[4]. The cost has no doubt proven to be an essential component to
accomplish any project’s success, as well as one of the most factors
that impact the project’s quality [5]. It is believed that construction
projects should be experiencing an increase of about 33% on average
[6]. According to a comprehensive research that was performed on
cost overruns in international construction projects [7], it was dis-
covered that 9 out of 10 projects have passed the previously set esti-
mations, 50–100% excesses were postulated to be common and had
a constant for 70 years through which data was available [8].
In most developing countries, the trend is different; at times
projects reach as much as a 100% of cost variance. Low quality
materials might have a clear impact on construction cost, even
higher than the expected/estimated, which is mainly caused by
material loss during the implementation process. This problems,
and others are the resultant of lack of standards that could mitigate
cost overrun and decrease construction costs, causing many con-
struction firms to fail [9]. Therefore, the development of an accu-
rate cost management strategy is essential, moreover, the
application of the strategy of, ‘‘Proactive Cost Management” will
be the way through [10].
One of the most important and largely impacting factors in the
project management’s life cycle is ‘‘Cost”; it can be considered as a
driver of the project success. Aside from its previously proved vital-
ity, it is very redundant to witness the failure of a project’s objec-
tive achievement within the previously set cost. Cost deviation
from the initial plan is dominating in most construction project
sites. However, there were not enough efforts exerted to eliminate
this proved phenomenon.
In the coming part of this research attempts to closely study,
search, identify and estimate the importance of different factors
that could affect cost deviation and variance within Egyptian resi-
dential projects according to their impact and importance respec-
tively; it also offers possible methodologies to get along with this
vast spread phenomenon [11].
2.1.1. Factors affecting cost overruns
Cost overruns in construction projects are generally affected
with a number of factors, these factors include: (i) Original cost
estimate accuracy; (ii) Government regulation and control level;
(iii) Construction completion delay; (iv) The number of design
changes; and (v) Additional benefits’ increase [12]. According to
other literature sources, four reasons are responsible for the
exceeding of project costs, these are: (i) Incomplete drawings; (ii)
Weak planning process; (iii) Increased cost of materials; (iv) Lack
of timely decisions; [13]. In general, the performance of the con-
struction projects’ costs is one of the most important measure-
ments that a project’s success is judged upon [14].
In order to make the abovementioned factors clear, Table 1
demonstrates two examples for cost overruns that were discussed
through literature sources, [15]. The selection of these examples
was based on the fact that they both suffered from cost overruns
with varying percentages, and they both represented the type of
projects this paper is mainly concerned with, namely ‘‘Residential
Projects”. These examples proved that the initial estimated cost
varies off the final exact cost. In addition, factors impacting cost
overrun in the two examples were deduced, these include: Weak
planning process and the inaccuracy in original cost estimate. An
Explanation of cost overrun in the examples using comparison
charts between planned cost and actual cost to is shown in Figs. 2
and 3 respectively.
2.2. Residential projects in Egypt
One of the most current active industries in the Egyptian econ-
omy is the construction industry, as the residential units continue
to grow rapidly to cope with the expansion of the population in
Egypt. The composition of the country’s population is one of the
most aggressive contributors to the booming of this kind of pro-
jects. Construction projects consist of complex operations that can-
not be predicted. It is as well very scarce to find unchanged
construction projects in terms of different aspects of the process.
This, of course, leads to quite a noticeable variation orders, which
in turn causes cost overrun, time delay, quality defects and other
negative impacts. Moreover, they lead as well to the uncertainty
of flow processes and the increase of non-value-adding processes
which reduce the value of the output [16].
2.2.1. Significance of residential projects in Egypt
The importance of housing projects in Egypt is quite relevant to
the increasing demand on private housing projects. Therefore, con-
structors have to initiate projects which meet all the requirements
of different standards of people. The demand density requires a lot
of work from the research studies to deliver the highest efficiency
in the shortest time within currently available options. The hous-
ing problem is one of the most common and vastly spreading prob-
lems that generally face decision makers in Arab countries,
particularly in Egypt, which forces the state to be responsible to
 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479
Table 1
Cost overrun in residential projects. Source: Updated after [15].
point of Example 1
comparison
project name Project Completion of 3343
housing units in the new
housing complex in Helwan
Factors Week Planning Process:
affecting The different nature of the
cost overrun soil than expected and the
addition of quantities of
work and the items did not
exist in the bill of
quantities, due to lack of
interest in soil studies
during the design phase.
Week Planning Process:
The project was stopped at
the beginning to complete
the licenses due to lack of
interest in the preparation
of licenses during the
design phase .
Cost A model for large
construction projects in
terms of value exceeding
fifty million pounds.
The contracting the Arab Contractors
company Company
Fig. 2. Difference between Planned and Actual cost in examples.
Fig. 3. Percentage of cost overrun in two examples. Source: Author.
Example 2
Mansheyet Nasser Housing
Project in New Cairo.
Week Planning Process:
The different nature of the
soil than expected, which
led to an increase in the
percentage of excavation
item, due to lack of interest
in soil studies during the
design phase.
In- accuracy in the original
cost estimate accuracy:
Increase in the value of
block work due to an error
in estimating the quantities
during the design phase.
The second project
represents a model for
construction projects of less
than 10 million pounds.
Mohammed Abu Al Wafa
Contracting Company
473
meet this high market demand and provide sufficient housing
units for citizens, especially the youth, low-income citizens. The
most basic needs of a 21st century citizen of any country are food,
clothing and adequate housing [17].
The residential construction market is predicted to be expanded
during the forecast period. As previously discussed, the population
growth and urbanization have the most impact regarding that mat-
ter. According to the International Monetary Fund (IMF), Fig. 4
shows a steep trend in comparison to time, which indicates how
rapidly the population increases. Fig. 5 illustrates how the coun-
try’s urbanization rate increased in response. This pattern/rate is
expected to proceed; as new housings continue [18].
2.2.2. Spreading of residential projects in Egypt
It was found that the land area on which Egyptians live is just
5–7% of the total land area of Egypt. Accordingly, the government
considers increasing resident’s occupation potential areas as a
practical solution to this problem. Thus, the demand for more res-
idential projects to start launching increases. Such a huge expan-
sion in the youth that is expected to go on for 25 more years
possibly pressurizes the state to step up urbanization expending.
In the past few years, building of 27 new urban cities has been
completed and people have occupied them too. However, this is
planned to be expanded to reach a total of 59 cities by 2018 (Real
estate sector to grow, 2015). This booming in the sector of the real
estate will be reflected in more similar residential units all over the
country [19].
Those repetitive projects of residential units are composed of a
number of identical blocks, a unit in a block as an example that
could be a repetitive floor in a high-rise building or a model house
in a housing project. Redundant projects have redundant activities
with identical durations that are the ongoing processes during con-
struction of a typical, repetitive house and those processes are by
default repeated in all units and blocks within that specific project.
One of the main issues which causes overrun during the construc-
tion process is underrating the importance of determining an esti-
mated cost as accurate as possible during the early stages of
projects [19].
2.3. Definition of value management methodology
To define the VM methodology, it could be described as a struc-
tured and systematic methodology which improves projects’ end-
products and activities. The main function of VM methodology is
to analyze products changes in construction and design projects.
In the meanwhile, management processes as well as business help
to equilibrate tasks that are necessary, along with cost and other
resources needed to accomplish. To sum up, ‘‘Value Methodology”
is the foundation of ‘‘Value Analysis”, ‘‘Value Management” and
‘‘Value Engineering” [20], Fig. 6. ‘‘Value analysis is a system of
thinking based on the function of Identifying and eliminating all
unnecessary costs while maintaining all types of quality in any
industry, construction or service or anywhere the dollar is spent
”[22].
‘‘Value Engineering is a management technique installed using
a structured approach to find the best functional balance between
lost reliability and product performance or enterprise search pro-
grams to improve management capacity of people and promote
gradual change by identifying and transferring unnecessary
costs”[23]. The ‘‘Value Engineering” methodology formulated by
SAVE*’s usage is not wide-spread in Egypt, awing to the fact that
the organizations are not aware of it and don’t put an effort to under-
*
SAVE International is the premier international professional society devoted to
advancing and promoting the Value Methodology in the united states and worldwide.
474 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479
Fig. 4. Egypt’s Population (millions). Source: Authors, after [18].
Fig. 5. The country’s urbanization rate. Source: Authors, after [18].
Fig. 6. Concepts associated with value engineering. Source [21].
stand it properly. The risk is taken by practitioners themselves, as
their main aim is to reduce cost, so other component functions get
affected as well. In addition, creative alternatives do not seem to
be provided due to the composition of teams that are non-
coordinated, although the formulation of teams determines whether
value engineering is to succeed or fail [24].
The concept to value management is defined as a structured,
organized, multidisciplinary effort aiming to analyze the functions
of a project for the optimum, possible cost reduction known as
‘‘Life Cycle Cost” (LCC). Value management (VM) aids team-based
decision-making with its structured and organized set of processes.
Its goal is to deliver the best value of a project or process by recog-
nizing the set of jobs that are required for the complete
end-product goal achievement, as well as reducing cost (whole life
cycle cost or resource use), while balancing performance and qual-
ity, [25]. The studies of value management can be accomplished at
any stage during the project’s development. However, it is well-
known that there is a room for a greater return on investment if
it is applied during stages illustrated in Fig. 7. Value Management
must be applied during the early stages of the project. It will be
more beneficial if it is applied even before fund commitments, sys-
tem/design approvals, to optimize and maximize the output as
much as possible [25].
2.3.1. Role of value management
Value management (VM) manages the full life-cycle cost and
not only that of the initial project, it provides an authoritative
review of the total processes and activities of a project and not only
a certain specified phase or some elements out of the total. Future
profits can be assessed if life-cycle costs are previously determined
out of similar/identical projects); decisions are made with greater
confidence due to the accuracy of available data and definition of
the performance criteria. All options, innovative ideas, and backup
plans are taken into consideration. The ultimate goal of VM is
obtaining maximum efficiency outcomes, over the addressed spec-
ification and building program improvement which can be devel-
oped and that is obvious in the time and cost savings, [26].
Proper implementation can identify the possibility of problems
during the early stages of the project.
VM grants management with the authoritative evaluations and
supports the information of a project’s design or brief summary
and their related operation as well as capital cost [27]. Cost savings
that range from 10 to 15 percent of the total cost of the project can
be accomplished if VM is implemented correctly. It is vital to take
into consideration that for these advantages to be fulfilled, it is
essential to apply VM as early as possible on a certain project.
The charge costs will be much lower as the project will not have
passed the design nor development phases, so it will be easier to
set estimations and limits from the beginning, and so the potential
of the greatest possible cost reduction will be a lot higher during
those early stages of project development.
The VM’s ability over construction industry competitiveness
increase could never be set away from the vigorous benefits that
VM adds to projects of the construction industry. Taking the right
decision during planning stage is, for example, one of the most cru-
cial activities and can be counted among the vast abilities of value
management. Furthermore, the correct planning production of
decisions will increase the beneficial advantages as well as effi-
ciency during the implementation phase of projects associated
with the building construction sector [28].
The most important goals that value engineering seeks to reach
are time and cost saving, quality improvement, mitigating
unessential resource waste, accurate decision-making, and team-
work enhancement, without letting go of the performance
enhancement factor. The decision should have an output of effec-
tive optimal solutions and eliminate confusion in values and cost;
other than that, it would be unacceptable. If the improvement of
quality or ability to achieve the functions is not accomplished by
added costs, the value will then be reduced. The measure of user’s
value is provided by three basic elements: function, quality, and
cost as shown in Fig. 8. The elaboration of these elements is pre-
sented by the following equation [29]:
Value ¼ ðFunction þ QualityÞ=Cost
Value ¼ ðPerformanceÞ=Cost
The Function: The specific work that the design should perform
for each item.
 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479 475

Fig. 7. The phases of the project and its relation to the expected savings by SAVE International. Source [24].

 Development Phase: Selecting and preparing a better alterna-

tive to improve value.
 Presentation Phase: Providing valuable feedback to project
stakeholders.

3. Analysis of the application of VM on residential projects

examples

The coming part of this research is considered the second step

towards fulfilling its aim. Through which, the authors were able
to analyze two selected residential building projects that are allo-
cated in Egypt. The impact of applying VM on controlling cost over-
run was evaluated. Table 2 summarizes the basic information on
the 2 selected projects, including the projects names, basic data,
and selection criteria.

Fig. 8. The value engineering equation. Source: [29].

3.1. Information phase

in this phase, The VM team leader has prepared a cost model

The Quality: The needs of the owner or user desires and from the assessed cost provided by the project’s team. The model
expectations.
The Cost: The cost of the project life cycle.
Table 2
Summary of projects basic information. Source: Updated after [30,31].
2.3.2. Phases of value management process
The value management process includes a number of sequential Example (1) Example (2)

phases, as shown in Fig. 9, starting from the information phase and Project Name A luxurious residential National Project for Housing
ending with the presentation phase as follows: compound choose The Unit of
ownership
of residential
 Information Phase: Gathering information to better understand Basic Data 1700 residential Units with an area of 63
the project. units over 300,300sqm square meters
 Function Analysis Phase: Analyzing the project to understand Selection Due to the significance Due to small project scale
Criteria of the estimated which specifies a project for
and clarify the tasks required.
construction costs, low-cost housing projects.
 Creative Phase: Generating ideas about all possible ways to which drew the attention
accomplish the required tasks. of the executive
 Evaluation Phase: Compiling ideas and concepts to identify pos- management.
sible ideas for development.

Fig. 9. Phases to apply the value management approach.

476 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479

is beneficial in the identification of the major construction trade

categories, the estimated cost that will be required by the designer,
and finally the total project cost for significant cost items’ percent-
age. By the end of this phase, the cost drivers already have a clear
vision for the project by cost models and continue to guide the VM
team during the VM study, [30].
In the analyzed example projects, the VM team had specific
observations regarding projects costs. These include the impor-
tance of producing a generic study regarding the project’s elements
as a whole and their cost ratio to that of the whole project, so that
the cost of each item is recorded and all data regarding this project
is detailed. Within this stage, reviewing of the drawings associated
with quantities and quality tables were necessarily checked in. In
addition, the determination of the effect of each item on the busi-
ness total cost should be performed. Finally, the items with great Fig. 11. Cost model, for example, two. Source: Updated after [31].

impact should be determined and entered in trials of evaluation.

3.2. Function analysis phase
The importance of functional analysis is the production of a
unique view for the project study, and it is the essential process
that distinguishes VM from any other problem-solving practice.
It transforms different elements of a certain project into functions,
and this mentally separates the VM team away from original
design and excels into a functional concept approach of the project.
Functions are addressed by verb-noun sentences in order to
accomplish a reduction of the project’s needs to a possible elemen-
tal level. This helps to identify the major functions of the design
elements of the project and allows the team to have a broader
understanding and consideration of alternative methods to achieve
their optimum functions [30].
The function analysis phase was applied in each of the analyzed
example projects, where an analysis of each project items and their
cost was performed, this includes Architecture system, Structural
system, etc. This process was performed with the objective to
select the most effective items in the total project cost. The cost
model for each of example 1 and example 2 are shown in Fig. 10,
and Fig. 11 respectively. It could be concluded that in example
(1), the Structure System percentage is significantly higher, which
guided the decisions of the VE team through the rest of the VE
workshop, although it did not restrain or limit the creativity phase.
In example (2), Architecture system was found to be the second
highest-cost effective system in comparison to other systems.
3.3. Creative phase & evaluation phase
The creativity phase generally involves the listing of creative
ideas, Whilst, throughout the evaluation phase the VM team, along
with the Clients and/or Users work collaboratively on evaluating
the generated ideas. These two phases are directly explained
through the analysis of their actual application on the two exam-
ples shown in Table 3. The main procedures of each phase was sim-
ilarly applied on each example project, however the outputs of
each process varied according to the particularity of each one.
3.4. Development phase
During the stage of progression in the VM research, remedies
start developing out of many ideas, this phase generally includes
collecting of data regarding the recommended design change,
Reviewing the pros and cons of the proposed change recommenda-
tion, and finally undergoing a review of lifecycle and initial cost. It
is crucial through this phase to associate a short story with every
professional suggestion in order to evaluate the recommended
change’s unique design method. Design data as well as design
images should be attached wherever seems appropriate to be a
part of the research.
3.5. Findings of the analysis of the example projects
Based on the previous analysis of the application of VM on the
example residential buildings, it has been proven clear that VM
application has an impact on optimizing cost overrun. Table 4
shows a comparative analysis between the two example projects
before and after the application of value management. In the first
example, the VM team went through the cost study, where they
reached a decision of applying waterproof membrane over an area
of 21,139 m2. As a result, the calculated direct savings were about
40% of the original roof layers cost. As for the second example, the
result for quantity of wood work which was proven to be of a high
influence on cost before applying value management was 647.285
compared to 547.2 units after applying of VM.

4. Application of questionnaire survey

Although it became clear that VM has a role in controlling cost

Fig. 10. Cost model, for example one. Source: Updated after [30].
overruns, however it is crucial to evaluate this role and directly
validate it from the perception of key stakeholders concerned with
the design and construction of residential projects in Egypt. Thus
the research undergoes an application of a survey questionnaire
that aims to detect the impact of applying value management in
residential construction projects according to the expertise
involved in this field. The questionnaire survey was basically
designed to assess the degree of respondents’ knowledge of VM,
how often do they use it on residential projects? the effectiveness
of the application of VM on controlling cost overruns, and when do
the respondents usually apply VM.
 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479 477

Table 3
Application of VM creativity and evaluation phases on examples. Source: Authors after [30,31].

Point of comparison Example (1) Example (2)

Creativity Phase procedures
Output: Generated Ideas
Evaluation Phase procedures
Output: Selection of best idea
The VM team generated as many possible ideas on how to offer the necessary function within the project area at a minimum
Initial cost or Minimum Life-Cycle Cost (LCC), which represents improved value to the client.
Possibility of saving in using Waterproofing Membrane Possibility of saving in Wooden Work - external plaster-
works of flooring.
Identification of the specifications to be used for evaluation.Description and evaluation of the ideas resulting from the creative
session.
Removal of incorrect or non-suitable ideas from an additional study.
Further improvement of the ideas of the greatest potential for cost savings and value enhancement.
The replacement of the lightweight concrete used in the roof During Analysis of architectural items and finishes it was
layers to be Foamed Lightweight concrete (FLC) concluded that the cost of the Wooden work represents the
largest cost among finishing work.

Table 4
Comparison between analysis of 2 Examples before and after applying VM. Source: updated after [30,31].

Point of Example (1) Example (2)

comparison
Layers Roof layers Roof layers after VM Wooden work Wooden work Wooden work
before VM before VM after VM
Water proofing  Primer Coat  Acrylic reinforced cement based Windows and  Numbers = 362  Numbers = 325
insulation.  Bitunil 4mm membrane waterproofing coat. doors  Total size = 647.28  Total size = 547.2
 Bituter 4mm membrane.

The target group included Architecture designers, site engi-

neers, structural engineers and electro mechanicals, where the sur-
vey was preliminary distributed on a purposeful sample of 100
personal. The response rate was almost 35%, which reflects the fact
that it’s quite challenging to get a large response rate upon apply-
ing questionnaires in such type of industry.
Most of the answers were mainly provided by Architecture
designers, which might be an indicator of the role played by them
in the whole residential buildings process. Most of the respondents
who already have fair knowledge of VM, or who are actually apply-
ing it were found to be junior architects with 5 years of working
experience.

4.1. Findings of the survey questionnaire Fig. 13. Level of awareness of VM.

A number of basic findings were extracted from the application
of the survey questionnaire.
4.1.1. The general knowledge of VM
The extent of usage of Value Management in the construction
industry is shown in Fig. 12. It shows that the most respondents
agreed on a Medium usage of VM of their residential projects. This
reflects the important role of the VM in construction in practice.
Whereas, Fig. 13 shows the level of awareness of respondents
regarding VM, where almost 51.6% of the respondents are aware
with it, which reflects an acceptable level of awareness among
stakeholders.
4.1.2. The application VM in residential projects
The degree of agreement on applying Value Management in
Residential construction project is shown in Fig. 14. Where most
of the respondents either agree or strongly agree to that. The
degree of agreement on applying Value Management at the earliest
possible stage is shown in Fig. 15. Where more than 50% of the
respondents agreed on the importance of applying VM from the
early residential project conceptual stages.
4.1.3. The role of VM in controlling cost overruns
The Percentage of cost saving by using value management is
shown in Fig. 16. According to most of the respondents, VM would

Fig. 12. Percentage of using value management. Fig. 14. The percentage of VM application in Residential projects.
478 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479

either related to cost overruns, quality of the products or related

to building team.

6. Conclusions

 It was obvious from the study that the analysis of residential

Fig. 15. Agreement on the application of VM in the early stage of the project.
 Based on the findings of this study the role played by VM in Res-
projects cases in Egypt showed that the cost overrun percentage
ranges from 21% to 55.19% in projects of constructional nature,
which encourages the application of value management process
in order to achieve cost control. Where, the first example
achieved 40% savings in cost concerning roof layers, in addition
to the improvement of thermal insulation reaching 55%.
Whereas, the second example reduced the openings of doors
and windows according to requirements of the design code,
which achieved cost savings in the wooden work item and also
in the work of aluminum item. This example managed to
achieve 15% cost saving from the original cost of all architec-
tural works in projects.
idential construction was clearly identified where the following
potentials were extracted from the findings of the study:
s Improvement in cost control of the project.
s Fulfillment of cost reductions without compromising value.
s The client gains more value of money.
s The process results in a quality product being delivered.
s The process results in successful team working.

Fig. 16. The percentage of cost saving by VM.

achieve almost 20% of cost savings, which matches the findings

extracted from literature and example analysis.

5. Generic findings

Based on the analysis of the results extracted from the applied

questionnaire survey, literature review and the analysis of exam-
ples, the authors observed the agreed upon role of value manage-
ment in residential construction projects. This is shown in
Fig. 17. It could be mentioned accordingly that there are potentials
that are gained upon the application of VM, these potentials are Fig. 18. Results of value management methodology in two different examples.

Fig. 17. The key potentials for applying VM in residential construction projects.
 L.M. Khodeir, A. El Ghandour / Ain Shams Engineering Journal 10 (2019) 471–479
 To sum up, it can be stated that obvious improvement of value
occurs when VM methodology and phases are effectively
applied. The paper clarified that the proposed alternatives
through value management’s research considerations reached
from 15% to 40% cost savings as observed in Fig. 18 due to sav-
ing cost from specific item(s). This result was supported by the
findings of the survey questionnaire as well. Where, the survey
results showed that applying Value Management in Residential
Construction projects has high impact in residential project spe-
cially cost reduction.
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Dr. Laila Khodeir, an Associate Professor of Architecture
and Management in the British university in Egypt and
at Ain Shams University , a certified Project Manage-
ment Professional (PMP) from the PMI, a Green Class-
room Professional from the LEED association and the
Principle Investigator of the Interactive Sustainable
Child Development Center (ISCDC) Research Project has
been graduated from Ain Shams University in 2002. Her
Master’s Degree in 2005 focused on ‘‘Social Sustain-
ability”, namely” The Impact of Local Communities on
Eco-lodge Design Criteria”. Whereas, her PHD in 2010
focused on a newly emerging discipline in Egypt at that
time, which is ‘‘Facility Management”. Since then, the research work of Dr. Laila has
focused generally on Facility Management, Construction Project Management and
the application of Management as a broad term in teaching Architecture. Up to date,
She has published more that 45 papers either in peer reviewed journals, or in
international conferences. In addition to publishing three book chapters, and acting
as a reviewer in a number of national and international journals, JOC Journal of
Construction, South Africa and Ain Shams Engineering Journal, Elsevier, Science
Direct.
Fields of Interest: Sustainable Design, Facility Management, Maintenance Man-
agement, Building Performance Evaluation, Construction Project Management, Risk
Management, Quality Management and Control, Change Management Practices,
Marketing Management for Construction Projects, Capacity Management, Value
Engineering.
Alaa Elghandour is a master’s student in Architecture
at the Ain Shams University. She is graduated from
Modern Sciences and Arts University (MSA). She is
currently a Technical Architect at Al Arabia for Real
Estate Co. (ARCO Egypt). Her research focuses on project
management studies, especially cost impact. Her inter-
ests include the role of value in construction projects in
Egypt.