Value Analysis and Value Engineering

Topics: Cost, Investment, Costs, Production and manufacturing / Pages: 8 (1806 words) / Published: Jul 24th, 2013
VALUE ANALYSIS & VALUE ENGINEERING
Value Analysis is an effective tool for cost reduction and the results accomplished are far greater. It improves the effectiveness of work that has been conventionally performed as it questions and probes into the very purpose, design, method of manufacture, etc., of the product with a view to pinpointing unnecessary costs, obvious and hidden which can be eliminated without adversely affecting quality, efficiency, safety and other customer features.

VALUE AND VALUE ANALYSIS
Let us consider at this stage what is meant by “Value’. ‘Value’ is itself is some what difficult to define. It means different things to different people. Also, it is often confused with the cost and price of a product or service. One way of defining the value of an item is: Worth to you Value = -----------------Price you pay This means that if you feel that you have your money’s worth, then you have received 100 per cent value. Which indicates that ‘Value’ has a subjective aspect, for what is good value for one person need not necessarily be so far another. In general, if for any function or a product or a service, you feel you are paying too much, or it costs you more than you think it should, there is scope for improving its ‘value’ into it. This leads us on to another useful way of looking at ‘value’. Value is the least cost that can accomplish reliably a function or a service. This implies that in achieving reduced cost, the quality and performance of the item are maintained. It follows, therefore, that value analysis is a technique which builds “Value’ into an item. Value can also be defined as that combination of quality, efficiency price, and service which ensures the ultimate economy and satisfaction of the purchaser. Value Analysis can be understood as a technique which helps everyone to determine this combination. It can be seen, therefore, that several components make up ‘Value’. There is value arising from the function or end use of an item,

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