The purpose of Value Engineering - Essay Example

By analyzing the function of omitting, the purpose of value engineering is to increase the value of a product by making it better or more efficiently through an exploratory process of information gathering, function analysis, brainstorming, idea evaluation, and implementation. Through a series bothers planned stages, a small mufti-disciplinary group of 5-7 people can find unimaginable solutions to problems that were once thought to be accepted practice. Design specifications and product functions are explored in regard to all costs and revenues involved in productions.

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The process can be applied to an entire manufacturing process, or for smaller items involved in the process of manufacturing something larger. We will explore the history and evolution of Value Engineering and its use in today’s economy and government functions. During the Great World Wars of the early Twentieth Century, times were tough as economies had to focus on the war effort as opposed to operating on the premise of business as usual. American women and children helped to fill voids in the workforce as men shipped overseas to fight the enemy.

Life had become a serious engagement of survival for all sectors and global trade was altered forever. Metal was in scarce supply as it was needed to build tanks, ships, guns and bullets. Food, tires, and everyday household goods were rationed by the government using a stamp book that eliminated the advantages of wealth because there simply wasn’t as much supply as there was demand. It was time when you had to dig deep for all supplies, and sometimes find alternatives in the absence of others.

Families, businesses and countries alike managed to get by, sometimes finding better ways to do things and alternatives to what was traditionally accepted. “The value methodology can be applied wherever cost and/or performance improvement is desired. That improvement can be measured in terms of monetary aspects and/or other critical factors such as productivity, quality, time, energy, environmental impact, and durability. VIM (value engineering) can beneficially be applied to virtually all areas of human endeavor. [1] After World War II, a Vice-President at General Electric sought to capitalize on this newfound way of finding better alternatives in this era of short supplies. A staff engineer named Larry Miles was placed in charge of this new program, and found he was occasionally performing a desired function at a lower price. Hence, Value Analysis was created during the Post-War Era. The Wall Street Journal later did a front page cover on the matter as well as a featured story in Reader’s Digest highlighting the benefits of the program.

The expanded national attention thrust Value Analysis into national spotlight and national trade conferences “further aroused the interest of industry and government. ” Value analysis caught the attention of many government officials and was later used by the US Navy. They hired naval staff engineers to complete the job and thus changed the name of the process to value engineering, accommodating their newfound positions with a simple title change. Value engineering is a recognized technique for reducing costs while maintaining or improving productivity and quality. The Department of Defenses EVE program consists of both government- and contractor-developed cost-reduction projects designed to reduce a system’s life-cycle costs. ” [3] It has expanded into a cognitive process used by small businesses, large corporations and government entities all over the world. The concept is used to help groups better compete in their given fields, and often evolve into other sectors of manufacturing.

The Society of American Value Engineers was incorporated in 1959, creating an organization to standardize the process and promote the benefits of the process. I am a member Of SAVE International and a certified Associate Value Specialist, having completed a course led by Thomas R. King, former president of SAVE and an elected SAVE Fellow. King is a man who has spent his life improving businesses around the world using value engineering techniques to conduct EVE studies. Of the many stories King told, one stuck with me that helps to define exactly what this process helps to accomplish.

He as called in to provide insight on one of the most expensive high school construction projects of its time in Philadelphia, PA. The cost of the project was in the range of $75 million which caused a significant outcry from local taxpayers in the area. King examined the project and noticed that a large part of the flooring finishes in the school was calling for VS., or vinyl composite tile. VS. is a rather inexpensive flooring finish as compared to a higher quality finish such as terrazzo floor tile, a poured ceramic which can cost 2-3 times as much.

At first glance, the choice of VS. is going to save the tax payers money by investing in a cheaper option. But as King pointed out, the VS. flooring is not durable and will streak and tarnish in a high-traffic environment such as a school filled with hundreds of students on a regular basis. This makes the life expectancy of the floor rather short and could need replaced in as little as five years. The more expensive alternative of terrazzo floor tile has a much more appealing, seamless look to it and is extremely durable.

This finish can last for decades under the right circumstances and will offer far greater return on your investment in the long run. King had the pleasant opportunity of explaining this finding to the already hostile residents that it was in their best interest to spend more money on an already over-budgeted project. Once it was understood the reasoning behind advocating the more expensive floor finish, most people accepted that the return value of the more expensive floor finish justified the higher initial cost.

Sometimes the popular solution isn’t necessarily the right choice in attaining the best value. Value Engineering Principles The design of value engineering is to gather a group of knowledgeable, open- indeed people together in a group setting to perform function analysis of a product or service. It is important to note that “the size and composition of the team is project dependent. The members should represent a diverse background and experience that incorporates all the knowledge required to fully cover the issues and objectives of the project.

Typically, these include cost, estimating, procurement/materials, and those technical disciplines unique to the project such as design, manufacturing, construction, environmental, and marketing, etc. ” [4] EVE professionals even recommend including an outsider on the study team, someone who brings little to the table in terms of product knowledge. Fresh, out-of-the-box thinking can prove extremely helpful in the creation of new Ideas that could bring new life to the project study. King clearly defines the best size for a EVE study group is 5-7 people.

Through his experience and with the experience of others in his profession, it is widely agreed that with any less than five participants in the group there can be a productivity shortage of ideas that could have been included had more folks joined in. In contrast, including more than seven artisans will lead to an overload or breakdown of group dynamics that limits the creativity or exploration of ideas that can greatly contribute to the power of the study at hand. “As different input is needed during the project life, experts can be brought in and out of team meetings as Ad Hoc members. [5] Although the exact number is debatable to any extent, having 5-7 participants brings the most to the table without drowning out anything that could evolve from discussions and be ruled out so to speak. This type of group dynamics is definitely a factor in a group setting that requires articulation and input from members to form an effective consensus. Through function analysis, the group will explore the value and usefulness of a product and explore any possible alternatives to the make-up, manufacture of, or distribution of that good/service.

It is the goal of value engineering methodology to create a better and/or more efficient product that has more value and/or less cost associated with the purchase and life cycle of that product. Simply put, we are looking to make better, more efficient product while maintaining or improving its quality. To do this, one must ask in the implies form what is a product for? What is the basic function off product? This reasoning is function analysis, the core of value engineering. King states there are three rules to be followed in defining function [6]. The first of which is to describe each function in two words, a verb followed by a noun.

A car can do many things such as heat seats, illuminate headlights, sound horn, project sound, travel distance and most importantly, transport people. By simplifying the basic function, it will help in finding solutions to meet the equivalent standard of replacing or improving something. After considering the function of a product and describing it, it is important to differentiate between ‘work functions’ and ‘sell functions. ‘ It is also necessary to differentiate between a basic function and a secondary function. These two functional distinctions are intertwined and often related.

A ‘work’ function is a basic function that serves a primary need such as transport people, while a ‘sell’ function is often a secondary function, such as enhance comfort or sound horn. [7] All secondary or sell functions are pretty much irrelevant if a product does not meet its basic primary function. In the process of value analysis, it is important to explore all applicable functions and afterward one can break the list into more detailed categories. A product such as a car must work to serve its primary obligations of transporting people safely before serving other needs such as looking pretty or having comfortable seats.

The end result Of a value analysis can improve several Of these functions at once by exploring alternative possibilities through function analysis. Once a function is explored and clearly defined in a EVE study, the next step is to explore all costs associated with production. This helps to determine where the highest savings may lie and where to focus your study. For example, if General Motors were to host a EVE study to build a vehicle more efficiently, they may choose to direct their attention towards more expensive parts such as a motor or transmission rather than door locks or headlights.

While all components of a vehicle are important in their own design and usefulness, a greater savings will most likely be found on more expensive pieces of the overall unit. It is not out of the question to perform a EVE study on smaller components, either. A brighter or sleeker headlight may be a ailing point that other similar vehicles do not possess, giving GM a competitive advantage in the market. Once a study objective is isolated and information regarding the topic is gathered, the next step is to brainstorm possible alternatives in a search to better the process.

Brainstorming is best done with an open mind and freeing yourself from the physical limitations of a product. Thinking free and creatively, never turn away ideas at this point allows for maximum input that may prove extremely useful further down the line. By turning down an idea at this phase, you are limiting the expansion of ideas and thus limiting yourselves. ‘Piggybacking’ is a term based expanding on other ideas to come up with the most creative ways to solve a problem, and is highly recommended during this phase.

The ‘Blast, Create and Refine’ concept was developed by Larry Miles and is a catchy phrase used to explain a technique used in several phases. “Understand that only the ‘Blast’ portion of the concept occurs in the function phase. ‘Create’ occurs in the creative phase, while ‘Refinement’ is ultimately completed in the evaluation phase. ” [8] Consider the function analysis phase as blasting away all physical aspects and engendering only the function off product that it is needed to perform. The brainstorming phase uses creative perspective to perform the function in new and imaginative ways.

The evaluation phase of value engineering is the accepted time to consider all of the gathered information and ideas, and is considered the judicial or ‘parental’ phase. (King Chapter 10, p. 121) This is the time to eliminate all the impractical ideas or the combining of those that work together. Common sense can play a pivotal role is this phase, ruling out ideas or options that have no chance at becoming legitimate solutions. Once the ideas are formed, they form the basis of the recommendation to management that will or can be made prior to the presentation or implementation.

For some who practice value engineering, the job plan ends here; the project is documented and formally presented to another agency for consideration and approval. ” [9] This phase ‘Refines’ the new ideas already on the table and is evaluated in a real world setting to consider their usefulness. It is here that the possibility Of using alternative materials or mechanisms can provide the same value to the consumer at a lesser cost. These new ideas have the potential to change the course of an entire industry and how products are manufactured for generations to come.