Value Analysis
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, where the Function is defined as: The effect produced by a product or by one of its elements, in order to satisfy customer needs. | , where the Function is defined as: The effect produced by a product or by one of its elements, in order to satisfy customer needs. | ||
| − | As can be understood from the equation, value is not only about minimizing the cost. As long as the increase of the function’s performance is relatively higher than the increase of cost, the value of the function will still | + | As can be understood from the equation, value is not only about minimizing the cost. As long as the increase of the function’s performance is relatively higher than the increase of cost, the value of the function will still |
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| + | ==References== | ||
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Revision as of 11:18, 26 February 2018
Contents |
Abstract
Value Analysis is a systematic tool which can be used to improve the value of a product or process by analyzing its constituent components and the associated costs(NPD KILDE). The overall objective is to find improvements to the components by reducing their cost and/or increasing the value of the functions[1].
History of Value Engineering
The origins of the Value Analysis goes back to World War II. During the war there was a shortage of both labour and materials which resulted in companies had to search for substitutions to their existing products in order to still meet demand. During this more value based approach General Electric (GE) noticed that substitutions often resulted in reduced cost, improvement of the product or both. GE took this Value Engineering approach out of necessity but it resulted in a systematic process which still has wide application to today[2]. This process is known as Value Analysis.
Value Analysis as a tool
In order to understand the how Value Analysis can be used as a tool, it is necessary to define the word “Value” in this context. Value has no clear definition but when used in Value Analysis it is defined as a Function’s performance relative to its cost.
, where the Function is defined as: The effect produced by a product or by one of its elements, in order to satisfy customer needs.
As can be understood from the equation, value is not only about minimizing the cost. As long as the increase of the function’s performance is relatively higher than the increase of cost, the value of the function will still
