Value engineering for railway construction projects: Cost driver analysis

Railway construction projects involve major capital investments, and a slight variance in design could lead to a significant change in the total project cost. To achieve value for money, it is necessary to optimize the design as far as possible. However, in reducing costs, it is important that key project objectives such as system capacity and operational flexibility are not sacrificed. In this article, a value engineering methodology, with particular emphasis on maintaining project objectives and requirements, is introduced. It involves identifying major cost drivers, devising explicit knowledge representations for these cost drivers, and analysing how they could be optimized without compromising key requirements such as the passenger-carrying capacity. The methodology is illustrated using real-world examples taken from the West Rail project in Hong Kong, which was originally conceived to be a twelve-car railway and subsequently optimized to become a seven-car system initially, with provisions to grow into an eight-car and then a nine-car configuration, without compromising the planned carrying capacity. The savings achieved were in the order of billions of Hong Kong dollars. One novel aspect of the proposed methodology is the development of a structured representation for a cost driver, through which non-obvious but significant savings could be derived.