A Value-Event Path Model Based Value Engineering Analysis Methodology

Value based management (VBM) aims to promote value of an enterprise, and value engineering (VE) aims to promote value by least cost. Combining these two ideas, this paper proposes a value-event path model based value engineering analysis methodology. In a management process, value of an enterprise is changed dynamically and the change of the value corresponds to an event which happens to the enterprise. In other words, events indicate changes of enterprise value. In this paper, the concepts of enterprise event, value-event node, and value-event path are defined formally. A management process can be looked upon as a value-event path. A good management process is a value-event path along which value increases by the event sequence, while a bad management process is a value-event path along which value decreases by the event sequence. Furthermore, an event in a value-event path can correspond to the ratio of enterprise function to cost. Therefore, a four-dimensional model (enterprise function, cost, value and event) is given in this paper. Multidimensional analysis on this model is a new VE analysis methodology for enterprise management. The methodology is a novel tool of enterprise management planning and assistant decision.