Applying Value Engineering to Resort Design

Published January 1, 2010

by Marge Lennon
Owner
Lennon Communications Group

Building, furnishing, maintaining and/or renovating a resort with the most beautiful interiors while working within strict budgets can be a delicate balancing act. Vendors who utilize the concept of Value Engineering can help provide optimum guest satisfaction and value by improving the function of their services and products while reducing their cost.

Value Engineering (VE) began at General Electric during World War II. Because of the war, there were shortages of skilled labor, raw materials, and component parts. Several G.E. executives sought acceptable substitutes and noticed that using these substitutes often reduced costs, improved the product, or both. Like many successful endeavors, what began as an accident of necessity was transformed into a systemic process, proving once again that necessity is the mother of invention.

The challenge of VE is to identify and preserve the function of a product, establish a worth (or value) for that function and then determine what can best improve that same function at a lower cost. Value here is defined as the relationship between price and quality. Also known as value analysis, value alternatives or value methodology, this technique generally results in an equal product at a lower cost while reliably performing the same ¬– or more – functions, giving the end user more value for their money.

In use for over 60 years, business and government agencies worldwide applying VE principles have saved costs and/or increased profits by billions of dollars while increasing product quality, usefulness and customer satisfaction. The process is applied in building roads and bridges, resorts and hotels and just about any time something is manufactured, … even in the printing of resort literature.

As an example, a leading timeshare company with 22 resorts utilized value engineering in the design and printing of their resort check-in folder. After the company’s creative agency designed a folder with a 5” die-cut pocket, the printer suggested reducing the pocket to 4 inches. By value engineering, the printer was able to print an additional piece on a press sheet, increasing the efficiency and yield by 30% and resulting in a savings of over $80,000 in printing costs.

At the recent Interval International Vacation Ownership Investment Conference, Dan Lubner, President Resort Division for Robb & Stucky Interiors and Jeff Forrest, President of Winter Park Construction, were speakers on a panel entitled: “Value Engineering in the New World.” Both agreed that the concept was an integral part of their business operations.

Robb & Stucky is a nationally respected interior design and premier furnishings retailer with showrooms in Florida, Arizona, Nevada, Texas and Costa Rica. The company has one of the country’s largest teams of licensed interior designers, many with extensive hospitality experience. About six years ago, they decided to increase their service capabilities by manufacturing what they design, creating customized product lines for commercial and hospitality applications, working extensively with worldwide management companies and developers of condominiums, hotels, timeshare and fractional properties. They have provided new interiors and renovations to properties from Denver to Dubai and locations in between and serve as an Alliance Partner for Preferred Hotel Group’s more than 700 member hotels, resorts and fractional ownership properties in over 70 countries.

Winter Park Construction specializes in the hospitality, multi-family, senior housing, student housing and commercial markets and has completed projects all over the United States.

For Robb & Stucky Interiors, the first step in utilizing Value Engineering for a resort client is to review the new or existing floorplan to develop the product that fits perfectly into the available area, not wasting any of the functional space. Some VE tips from Dan:

• By suggesting an 18” dresser instead of a 20” dresser, the cost could be reduced by as much as 30% due to the need for less wood.
  
• When selecting fabrics for upholstered items, such as sofas, chairs or pillows, it is important to use fabrics that do not have a “repeat” design, such as patterns or stripes. This will require additional yardage and result in higher costs for the material. A print fabric could be used on the front of a pillow to give a wow factor with a solid, less expensive fabric on the backside.
  
• Designing a product that is multi-functional can be a huge savings. An example would be a piece that can serve as a footstool, seat or luggage rack while still achieving the overall design aesthetic.
  
• Robb & Stucky also applies Value Engineering to the shipping of the furnishings and how they are loaded for containerized shipping. The proper loading can save thousands of dollars in potentially wasted space, enabling the client to unload the container piece-by-piece, unit-by-unit, or by floor or building, maximizing efficiencies and minimizing the client’s expenses.

Added Gail Huff, ASID, NCIDQ Senior Project Designer with Robb & Stucky in Scottsdale, AZ, “Value Engineering is also about great design that fits the function and desire of the client while taking advantage of a designer’s knowledge to value engineer out (delete) the unnecessary aspects of the design. For example, a beautiful wood headboard with brushed nickel inserts and marble accents can maintain the original sleek, sophisticated look and reduce the cost by simply deleting the stone accent with brushed chrome or steel.”

Ron Nowfel is also a senior designer for Robb & Stucky. Based in Orlando, he has recently handled design assignments for several Bluegreen Resorts. He shared these Value Engineering tips:

• Use one large piece of art vs. two smaller pieces or design a headboard as a bold piece of art to eliminate the need for artwork above it.
  
• Select one piece of furniture in a room to serve as a focal piece while designing secondary pieces in a simpler style to reduce costs.
  
• Turn the tiles in the floor or shower at a diagonal to generate interest and eliminate the need for a more expensive decorative accent tile.
  
• Order 100 pieces even though you may only need half this month and the balance in the next three months. Purchasing larger quantities always results in savings.
  
• Often less is more. Sometimes a single floral stem in the right vase can have more impact than two-dozen flowers.

From the contractor’s perspective, Jeff Forrest of Winter Park Construction added his comments. “Personally,” he says, “I think the phrase Value Alternatives more accurately describes this process. In preparing our proposals, we create value in the pre-construction phase with the presentation of realistic budgets. We also look at scheduling, the life expectancy of certain products and materials and energy efficiencies. It is entirely possible that an item will look and cost the same but will last a different amount of time. As a contractor, it is my responsibility to decide not only about what something costs but how it will function and how it provides a better economic value related to energy use. We try to use local resources and materials whenever possible. People tend to focus on value in relationship to dollars but quality designs and plans create value and can result in significant operational efficiencies. It’s not just about trying to provide a better price; it is a relationship between quality and the cost that provides value.”

Both Robb & Stucky Interiors and Winter Park Construction agree that Value Engineering doesn’t cheapen the product or service, nor does it cut corners. Through the use of some serious creative thinking, it simply answers the question “what else will accomplish the purpose of the product, service, or process we are studying?” In essence, VE is a powerful, decision-making process that improves the value of a project though the analysis of its functions, often resulting in additional benefits beyond design and cost savings. Using vendors who apply this process can play a significant role in helping you to achieve the best value in every segment of resort development.