MANAGING THE IMPACT OF RISK FACTOR ON VALUE ENGINEERING PROPOSALS FOR THE ARCHITECTURE PROJECTS

Abstract

Both Value Engineering (VE) and Risk Management (RM) are effective tools for architectural project management. Eventually, the value engineering outputs provide recommended VE proposals or alternatives for a specific material or system; based on its quality and cost, while Risk Management provides analysis for the impact of the project risks by identifying the probability and impact of the expected risks that might affect the project. The integration of both tools is necessary to benefit from both outputs simultaneously. The previous integration approaches have provided an integration protocol and methodology, but they have missed the mathematical attitude. This research aims to fill this gap by suggesting an integral equation that considers the impact of the risk factor associated with each of the value engineering proposals. This risk factor will express the resultant of all expected risk impacts that will affect the VE proposals, if executed, into a newly developed equation. This equation will optimize the selection of the VE proposal based on the accomplished risk impacts in a mathematical approach. The research used structural equation modelling (SEM) as a scientific method to develop the new equation and to study the relationship between its variables.