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Unit 10: Value Analysis

 Although good results have been obtained in several individual cases in some industries, Notes
only a large scale and systematic application of this technique in all industries, and in
defence production, can result in substantial economies on a national scale.
 The value analysis technique supported cost reduction activities by relating the cost of
components to their function contributions.

 Value analysis defines a “basic function” as anything that makes the product work or sell.
A function that is defined as “basic” cannot change.
 In all problem solving techniques, we are trying to change a condition by means of a
solution that is unique and relevant.
 When trying to describe problems that affect us, we become locked in to a course of action
without realizing it, because of our own bias.
 A function should be identified as to what is to be accomplished by a solution and not how
it is to be accomplished. How the function is identified determines the scope, or range of
solutions that can be considered.
 From a product design point of view, products that are perceived to have high value first
address the basic function’s performance and stress the achievement of all of the performance
attributes.
 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.

 FAST permits people with different technical backgrounds to effectively communicate
and resolve issues that require multi-disciplined considerations.

 Value analysis can be applied universally, i.e., to everything materials, methods, processes,
services, etc., where it is intended to bring about economics. One should naturally start
with items where the maximum annual saving can be achieved.

10.8 Keywords

Value: The value of a product will be interpreted in different ways by different customers.
Value Analysis: Value analysis is a “basic function” as anything that makes the product work or
sell.

FAST: Function Analysis System Technique is an evolution of the value analysis process.
Cost Reduction: Cost reduction is the process used by companies to reduce their costs and
increase their profits.

Reliability: Reliability (systemic def.) is the ability of a person or system to perform and maintain
its functions in routine circumstances, as well as hostile or unexpected circumstances.
Quality: Quality in business, engineering and manufacturing has a pragmatic interpretation as
the non-inferiority or superiority of something.
Quality Function Deployment (QFD): It is a “method to transform user demands into design
quality, to deploy the functions forming quality, and to deploy methods for achieving the
design quality into subsystems and component parts, and ultimately to specific elements of the
manufacturing process.”
Estimated Costs: A cost estimate is the approximation of the cost of a program, project, or
operation.

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