Enhancing value in public construction projects : the Malaysian journey

Abstract

There is a strong demand to improve the capacity and effectiveness of the construction industry. The evidence suggests that VM has become a powerful management tool to identify the best options for achieving a greater value for money. The issuance of EPU Circular No.3 in 2009 imposed mandatory VM as a management tool to achieve value for money for public projects amounting MYR 50 million and above. The purpose of this paper is to unveil the journey in institutionalizing VM in planning and implementation of public construction projects in Malaysia, with emphasis on exploring the achievements of VM workshops. Content analysis was conducted to investigate the level of applications, supported by case studies into five workshops. The case studies involved observations and semi-structured interviews with various stakeholders. To date, a total of 268 VA workshops were conducted, with the total estimated cost of MYR 70 billion for various projects such as healthcare, educational, industrial, and recreational. Next, the paper discusses three major aspects of the workshop’s outputs; the gross floor area model, the cost model, and the efficiency model. The outputs represent the optimization and value added achieved by the VA workshops to increase the likelihood of delivering values into public construction projects. The findings presented in this paper not only shed light on the current development of the VM applications but also provide the benchmarking data to improve future VM workshops.