Exploring Value Generation in Target Value Design Applying a Value Analysis Model

Abstract

Target value design (TVD) is a management approach that applies target costing in thedesign and construction industry. TVD enables a project environment with favorable characteristicsto generate value. However, because the TVD’s primary assessment is cost, target cost can be metwithout necessarily achieving the project’s full value. This research applies the action researchapproach to implement TVD in a housing project and explores the value generation of the projectusing a value analysis model (VAM) to study the balance between cost and value fulfillment in theproduct and design process. According to the results, even though the target cost was achieved,the desired value of the project was not achieved during the project design. However, there is atendency to increase value over time to a greater extent in the product and not so much in the process.The main contributions of this study are the possibility of comparing cost and value, identifyingthe emphasis of product over process and cost over value throughout the TVD project. This studyenhances the literature on project value generation and maximization, offering new knowledge for abetter understanding of how to conduct a value analysis in combination with costing in TVD projects.