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Unit 10: Value Analysis
Self Assessment Notes
Fill in the blanks:
5. This high level of abstraction can be achieved by describing what is to be accomplished
with a ……….and a …………..
6. Identifying the function in the broadest possible terms provides the greatest potential for
…………….. thinking.
7. Determining the basic function of ……………. components can be relatively simple.
8. Few people purchase consumer products based on …………………. or the lowest cost of
basic functions alone.
10.3 Value Analysis Process
The first step in the value analysis process is to define the problem and its scope. Once this is
done, the functions of the product and its items are derived. These functions are classified into
“basic” and “secondary” functions. A Cost Function Matrix or Value Analysis Matrix is prepared
to identify the cost of providing each function by associating the function with a mechanism or
component part of a product. Product functions with a high cost-function ratio are identified as
opportunities for further investigation and improvement. Improvement opportunities are then
brainstormed, analyzed, and selected.
The objective of the Function Cost Matrix approach is to draw the attention of the analysts away
from the cost of components and focus their attention on the cost contribution of the functions.
The Function Cost Matrix displays the components of the product, and the cost of those components,
along the left vertical side of the graph. The top horizontal legend contains the functions
performed by those components. Each component is then examined to determine how many
functions that component performs, and the cost contributions of those functions.
Detailed cost estimates become more important following function analysis, when evaluating
value improvement proposals. The total cost and percent contribution of the functions of the
item under study will guide the team, or analyst, in selecting which functions to select for value
improvement analysis.
A variation of the Function-Cost Matrix is the Value Analysis Matrix. This matrix was derived
from the Quality Function Deployment (QFD) methodology. It is more powerful in two ways.
First, it associates functions back to customer needs or requirements. In doing this, it carries
forward an importance rating to associate with these functions based on the original customer
needs or requirements. Functions are then related to mechanisms, the same as with the Function-
Cost Matrix. Mechanisms are related to functions as either strongly, moderately or weakly
supporting the given function. This relationship is noted with the standard QFD relationship
symbols. The associated weighting factor is multiplied by customer or function importance and
each columns value is added.
Task Prepare a presentation on the process of value analysis.
These totals are normalized to calculate each mechanism’s relative weight in satisfying the
designated functions. This is where the second difference with the Function-Cost Matrix arises.
This mechanism weight can then be used as the basis to allocate the overall item or product cost.
The mechanism target costs can be compared with the actual or estimated costs to see where
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