Agencies should consider using value engineering – a process used to make better decisions at lower costs –in most new projects, according to a circular issued by the Office of Management and Budget.
Agencies must consider using value engineering on any project that would cost more than $5 million, and are required to identify a senior official responsible for ensuring the use of value engineering at the agency, according to a notice published in the Federal Register.
Value engineering is a “well-established commercial practice for cutting waste and inefficiency that can help Federal agencies reduce program and acquisition costs, improve the quality and timeliness of performance, and take greater advantage of innovation to meet 21st century expectations and demands,” the notice said.
The new guidance would also waive the requirement of inspectors general to audit all projects using value engineering and requires agencies to conduct value engineering training for managers to ensure its best use.
Agencies must also identify value engineering studies in their annual budget requests to OMB, according to the notice.
Related: Read the OMB Circular.