The 5 Stages of a Value Engineering project (2/5)

Published on 4 November 2021 at 12:01

When all preparation has been done and the cause, goals and targets for the project have been defined, it is time to start generating ideas. Often, this is done during a Teardown Workshop. During these sessions in a multi-disciplinary team, participants physically (dis)assemble the product and question every part of it. Most people often only see the product from drawings and spreadsheets, but their creativity usually is visual-minded. This physical, hands-on experience provides a unique opportunity to take a step back and have a fresh look. You'll be surprised how many new insights are gained!

Idea Generation

A value engineering project roughly takes the following five stages from kick-off to results. 

  1. Define your Needs, Goals & Targets
  2. Ideate, Explore & Brainstorm
  3. Analyze, Evaluate & Decide
  4. Execute & Implement
  5. Track & Achieve results

This blog will look deeper into each of these stages, so you'll know what to expect and what to look out for.
Today's topic: Stage 2 - Ideate, Explore & Brainstorm.

Value Engineering Project

Stage 2: Ideate, Explore and Brainstorm

After a clear definition of the cause and goal of the project, it's time for action. Depending on the project objective, this phase is often based around a Teardown Workshop:  a hands-on brainstorm session executed in a multi-disciplinary team in which all departments of your organization are represented. However, prior to those sessions, some homework needs to be done.

Shoud-Cost Analysis

To be able to generate ideas for cost reduction, first detailed information on the current cost-buildup of the product is needed.  The  current cost of the product can often be determined from your own administration. Procurement costs, processing costs and overheads combined results in the amount a product currently costs you. Cost driver analysis can then structure these results and cost versus function analysis helps determine what those costs are currently spend on. Those analyses describe which parts and functions of the product cost the most, and thus provide a focus of the brainstorm sessions later on.

Shouldcost Analysis

After clearly defining the current cost buildup, it can be compared to a should cost benchmark. This shouldcost analysis then provides insight on the quick saving potential of each process or (purchased) part. A large difference between current cost and should cost indicates an inefficient process or expensive supplier, whereas a small difference indicates a more optimized way of working.  This insight can provide direction to further analysis.

Based on the current cost and should cost combined the saving potential of new idea's can quickly be quantified, which helps prioritizing ideas .

Value Mapping

Besides looking into the costs of your product, also its value proposition is very important. Value mapping, cost versus functions and  competitor analysis are all very helpful tools to understand the market and the position of your product and competition therein. Clearly defining the core values of your product, scoring your product and its competitors along them and defining a focus where to improve helps you understand your market and provides direction to the ideation in the teardown workshop.

Collecting current ideas

Often, your organization as a whole already knows a lot more than you think. Asking every employee involved to write down improvement ideas they might already have probably provides you with a list of ideas before you've even started the workshop. Not only can those ideas be valuable on their own, but also provide inspiration for new ideas during the workshops. And moreover, why even spend valuable workshop time on creating ideas you already have?

Product Cost Reduction

Teardown Workshop

When all the preparations are completed, it's time for the actual idea generation. What's the best way to create new insight in your own product? Exactly, by physically (dis)assembling it during a teardown workshop! Depending on your product and organization, this workshop could take anywhere between one full afternoon up to two full days. During this time, focus and multidisciplinarity are very important. No distraction from other meetings or phone calls, and presence of every department of you organization is preferred. In this way, every department brings there own strengths and insights, and lines between departments are shortened. Often, most people only see the product from drawings and spreadsheets, but creativity usually is visual-minded. By slowly disassembling your product, and having a close look at every single part, lots of new insights are created.
Why is this placed there? Why did we choose this material? Why are those bolts so hard to reach?
Can't we design this in a smarter way?

This workshop provides a unique opportunity for R&D, design & engineers to take a step back and have a fresh look on their creation. However, (not) surprisingly, also a substantial part of all critical questions are raised by non-engineers as well!

Cost Optimization

Brainstorming

During the Teardown workshop, participants create as many ideas as possible. No idea is too bad or too far-fetched, exploring new opportunities has the focus. Everything is written down on post-its and saved for later. After the session, all ideas are collected in one single overview to be further analyzed and evaluated in stage 3: Analyze, Evaluate & Decide.
Read all about it in our next blog!

Would you like to organize a Teardown workshop to generate new ideas for cost reduction or design improvements? Explore the opportunities at Our Services or Contact Us Now!


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