Question 4

Value Engineering
1.
Value engineering (VE) is a systematic method to improve the "value" of goods or
products and services by using an examination of function. Value, as defined, is the
ratio of function to cost. Value can therefore be increased by either improving the
function or reducing the cost. It is a primary tenet of value engineering that basic
functions be preserved and not be reduced as a consequence of pursuing value
improvements.
The reasoning behind value engineering is as follows: if marketers expect a product
to become practically or stylistically obsolete within a specific length of time, they
can design it to only last for that specific lifetime. The products could be built with
higher-grade components, but with value engineering they are not because this
would impose an unnecessary cost on the manufacturer, and to a limited extent
also an increased cost on the purchaser. Value engineering will reduce these costs.
A company will typically use the least expensive components that satisfy the
product's lifetime projections.
Value engineering uses rational logic (a unique "how" - "why" questioning
technique) and the analysis of function to identify relationships that increase value.
It is considered a quantitative method similar to the scientific method, which
focuses on hypothesis-conclusion approaches to test relationships, and operations
research, which uses model building to identify predictive relationships.
2.
The concept of value engineering originated during the Second World War. It was
developed by the General Electric Corporations (GEC). Value Engineering has gained
popularity due to its potential for gaining high Returns on Investment (ROI). This
methodology is widely used in business re-engineering, government projects,
automakers, transportation and distribution, industrial equipment, construction,
assembling and machining processes, health care and environmental engineering,
and many others. Value engineering process calls for a deep study of a product and
the purpose for which it is used, such as, the raw materials used; the processes of
transformation; the equipment needed, and many others. It also questions whether
what is being used is the most appropriate and economical. This applies to all
aspects of the product.
Simplification of processes reduces the cost of manufacturing. Every piece of
material and the process should add value to the product so as to render the best
performance. Thus, there is an opportunity at every stage of the manufacturing and
delivery process to find alternatives which will increase the functionality or reduce
cost in terms of material, process, and time.
The different aspects of value engineering can be encapsulated into a sequence of
steps known as a Job Plan. Value Engineering in organisations helps to identify:

The problem or situation that needs to be changed/improved

All that is good about the existing situation
The improvements required in the situation
The functions to be performed
The ways of performing each function
The best ways among the selected functions
The steps to be followed to implement the function
The person who executes the function
It should be remembered that we are not seeking a cost reduction sacrificing
quality. It has been found that there will be an improvement in quality when
systematic value analysis principles are employed.
Examples of Value Engineering
Russian liquid-fuel rocket motors are intentionally designed to permit ugly (though
leak-free) welding. This reduces costs by eliminating grinding and finishing
operations that do not help the motor function better.
Some Japanese disk brakes have parts toleranced to three millimeters, an easy-tomeet precision. When combined with crude statistical process controls, this assures
that less than one in a million parts will fail to fit.
Many vehicle manufacturers have active programs to reduce the numbers and types
of fasteners in their product, to reduce inventory, tooling and assembly costs.
Often a premium forming process (like near net shape forming) can eliminate
hundreds of low-precision machining or drilling steps. Precision transfer stamping
can quickly produce hundreds of high quality parts from generic rolls of steel and
aluminum. Die casting is used to produce metal parts from aluminum or sturdy tin
alloys (theyre often about as strong as mild steels). Plastic injection molding is a
powerful technique, especially if the parts special properties are supplemented with
inserts of brass or steel.
When a product incorporates a computer, it replaces many parts with software that
fits into a single light-weight, low-power memory part or microcontroller. As
computers grow faster, digital signal processing software is beginning to replace
many analog electronic circuits for audio and sometimes radio frequency
processing.
On some printed circuit boards (itself a producibility technique), the conductors are
intentionally sized to act as delay lines, resistors and inductors to reduce the parts
count. An important recent innovation was to eliminate the leads of surface
mounted components. At one stroke, this eliminated the need to drill most holes in
a printed cricuit board, as well as clip off the leads after soldering.

In Japan (the land where manufacturing engineers are most valued), it is a standard
process to design printed circuit boards of inexpensive phenolic resin and paper,
and reduce the number of copper layers to one or two to lower costs without
harming specifications.