The link between LA District’s Bill Zeigler and the Japanese emperor is a roundabout but clear one.

Zeigler, the District’s Value Engineering (VE) sherpa, and the Japanese government both recognize the enormous contributions of a former General Electric engineer, Larry Miles, and his strategy to enhance value in a product or service. Miles is widely credited with creating the VE concept as a productivity and cost-savings measure in the 1940s while at GE.

So impressed and influenced were the Japanese that they bestowed on Miles a rare prize for a foreigner, the Imperial Award, Third Order of Merit with Cordon of Sacred Treasure. Miles was honored posthumously in 1985. (Only three other Americans have been given the award, and two of them are also shoguns for Japanese business: quality control expert W. Edwards Deming and management guru Peter Drucker.)

Like the Japanese, who devoured Miles’s theories to help them become an industrial superpower, Zeigler and the Corps have incorporated VE lessons into an internationally acclaimed program. And like Miles himself, Zeigler’s Los Angeles District and the South Pacific Division recently have been recognized for their efforts with two prestigious engineering awards presented each year for saving the taxpayer’s dime and time.

The District won the Alphonse J. Dell’Isola Award for “outstanding accomplishment in construction” related to the mammoth $216 million Los Angeles County Drainage Area (LACDA) flood control project in southern California. LACDA was completed five years ahead of schedule and $150 million under budget.

The Division won the Gordon Frank Award for its “reinvigoration of the regional Value Engineering Program” throughout its three districts in five states.

SAVE International, a Dayton, Ohio-based global professional organization dedicated to the advancement of Value Engineering and related project management disciplines and techniques, administered the awards. Significantly, its first president was Larry Miles. The awards were presented in June at the group’s annual conference in San Diego.

The Corps uses VE to identify improvements in defense systems that can reduce costs and increase performance. Corps-wide, VE has been used since the mid-‘60s, and historically the program has returned $20 for each dollar spent on the VE effort. The bottom line: an estimated $4.3 billion in construction of facilities, without additional fund requests to Congress. “We’ve had international recognition for some time,” says Michael Holt, chief of Value Engineering/Value Management at Corps headquarters in Washington. “We are known among the best in the world.”

In addition to the SAVE trophies, the District also won in June the 2004 VE Organization of the Year Award presented by the Pentagon. And individually, Zeigler won the 2002 VE DoD Award.

The Office of Management and Budget in 1993 began to require that all federal spending over $1 million have a VE study completed. The law includes proposed construction or operations and maintenance projects, as well as procurements. A 1996 proviso required that all federal agencies have a VE presence and use VE procedures. “The earlier Value Engineering is employed in a project, the sooner savings can be realized,” declares one Corps Web site.

Besides applying VE to its own projects, the Corps regularly helps other federal, state, regional, county and city agencies, as well as other nations, begin their VE programs. At one VE workshop, for example, Holt reckons that the Corps saved another government agency $100 million, bringing it back into the black and on schedule. The other agency “was way over budget on that one, but didn’t want to ask Congress for more money,” he explains.

Over the last five fiscal years, the Corps’ VE savings and cost avoidance have totaled $231.7 million in its military projects and $488.4 million in civil works, for a total of $720.1 million. As the late Sen. Everett Dirksen once famously said: “A billion here, a billion there, soon you’re talking about real money.”

VE is applied to contract negotiations, innovation, independent technical review, civil works planning assistance and to preparing the scope of projects. It is also used to grow a contractor’s profits, expand work for construction contractors and increase the number of local contractors. High-profile projects bolstered by VE in recent years include an Indianapolis waterfront, Mississippi River levees, a Louisiana sanitary sewer and a Chicago shoreline.

For the LACDA SAVE award, Zeigler said the VE study on the flood-control project was conducted in 1993. He estimated that a total of about $61 million—a 13% cost reduction—was saved on the project: $10.5 million from ideas related to the parapet walls of the LA. River, and another $50.5 million on other modeling of the river. The VE study cost $770,000 (including $700,000 for the additional modeling). Zeigler calculated the cost/savings ratio for LACDA at $79.22 to $1.00.

In the nomination for SAVE’s Gordon Frank “Outstanding Achievement in Government” Award, South Pacific Division said that in the three fiscal years after 2001, the Division rose to first among its peers in VE performance. In Fiscal Year 2004, the Division accounted for one-fourth of total Corps monetary savings and undertook one-third of overall Corps VE studies. That same year, savings credited to VE more than doubled to $22 million, while scheduled VE studies nearly tripled.

At DoD’s own VE ceremony at the Pentagon, LA District received the “Top Defense Organization Award” for tripling the number of VE workshops, documenting $22 million in savings/avoidance and using the VE College Initiative Program to introduce University of Southern California students to Corps and VE through a life project. LA District Engineer Col. Alex Dornstauder accepted the award on behalf of the District.

The man behind VE was born and raised in Nebraska, the son of schoolteachers. After stints as a teacher, principal and bank cashier, Miles became a design engineer at GE in 1932. In a stunning prelude of things to come, during his first six years at the company, he earned 12 patents for vacuum tubes and related circuits.

But it was in 1938 that Miles unleashed his Archimedean “Eureka!” moment. As Miles himself manually typed it in a 1977 letter, he burst into his boss’s office in Schenectady, N.Y., and demanded, “Doesn’t anyone in GE care what things cost?” Impressed, or stumped, or both, his boss called his boss, who had the sense to say: “Send him over.”

During World War II Miles recalled that he was assigned the task of “finding, negotiating for and getting” vital military-related materials, such as steel, copper, bronze, tin and nickel. They were always in short supply, so Miles resorted to the basics: “If I can’t get the product, I’ve got to get the function. How can you provide the function by using some machine or labor or material that you can get?”

Thus was born a truly new intellectual discipline, Value Engineering, and Miles began to refine it and preach its gospel in the late 1940s. SAVE International’s Web site defines the concept: “Synonymous with the terms value management and value analysis, value engineering is a professionally applied, function-oriented, systematic team approach used to analyze and improve value in a product, facility design, system or service—a powerful methodology for solving problem and/or reducing costs while improving performance/quality requirements.

‘By enhancing value characteristics, Value Engineering increases customer satisfaction and adds value to your investment. Value Engineering can be applied to any business or economic sector, including industry, government, construction and service. Using Value Engineering is a very successful long-term business strategy.”

Exhibit A: Japan Inc. The mirror image of corporate America’s flirtation with Japanese management practices in the 1980s was Japan’s wholesale embrace of certain American business theorists in the 1950s. Foremost among them were Miles, Deming (quality control) and Drucker (management). Long before these men became icons for the Fortune 500 or Beltway, they’d been studied, copied and enshrined on Japanese factory floors.

Just as in 1963, when the Beatles reinvigorated a rock ‘n’ roll sound that had slipped into bubble-gum ballads, it took foreign appreciation of these men to make them prominent in the U.S. After seeing the Matsushitas, Toyotas and Hondas succeed using value engineering, statistical quality control and managing for results, Americans began applying those re-exported tools to their own enterprises.

The Corps was among those federal agencies in the forefront of seizing on Miles’s ideas, first promulgating them in Tulsa District in 1964. Ever since, Corps team members have followed his “steps to disciplined thinking,” which Miles estimated would provide 25-50 per cent more efficiency in the quality and quantity of mental work. “Improved problem solving, creativity and decision-making can dramatically increase the value of products and services,” says a University of Wisconsin Web site devoted to Miles’s legacy.

He found an apt student in Bill Zeigler. After he won the 2002 DoD Value Engineering Award, Zeigler assumed a typically modest posture. “We don’t set out just to save money,” he said, “but saving money comes along anyway.”

Or, as a Japanese might say: Isseki nicho. Two birds with one stone.