Tips to simplify designs
When you consider options in the development or refinement of a product, how do you go about it? How do you decide on material selections or functional options? How do you assess the relative value of the choices you need to make?
The value analysis and value engineering (VA-VE) process formalizes a series of steps and applies analysis tools that are clearly defined and widely implemented in what is an increasingly formalized process. This process has undergone a steady evolution since its origins in the 1940s in General Electric.
At the start, it was a simple method to evaluate alternative materials as substitutions for short-supply metals in GE ship propulsion systems—steam turbines, boilers and control gear. These war-critical production items relied on materials that were in chronically short supply, so Lawrence Miles initiated a program to look at alternatives that reduced supply pressures.
This has evolved into a foundational approach in cost reducing and performance enhancing evaluation tools for the optimization of existing products and the systematic enhancement of the selection of options in the new product development process.
VA-VE process steps
The information gathering phase: This involves collating relevant information about the product or process to prepare for the review. This review integrates assessment of functionality, cost drivers, production processes, performance requirements, and end-user expectations. The process establishes a baseline understanding of the product’s current value/costs and highlights areas where improvements might be opportune and offer high return on invested effort.
Function analysis phase: In this phase, the analysis of the product’s functions is made, categorizing them as primary (essential functions that the product must perform) or secondary (non-essential or support functions). A widely used tool in this phase is the function analysis system technique (FAST) diagram, which serves to visually characterize the relationships between functions.
Creative phase: This focuses on generating alternate solutions to perform the required primary (and secondary) functions. Those involved explore a wide spectrum of ideas to improve the product’s value, often pushing boundaries and exploring unconventional approaches. Creativity and collaboration are key to finding new ways to achieve the same or better functionality at a lower cost.
Evaluation phase: After generating multiple ideas, the feasibility, cost implications, and potential risks of each alternative must be evaluated, and the solutions assigned a recommendation of “go-no-go” status and priority. Solutions are compared based on their cost of enactment, ability to enhance value without compromising essential functions or quality, and their cost saving implications.
If the rejection rate of proposals in this phase is low, it may indicate that the proposals are too cautious, and an imagination reset might be appropriate.
Development phase: The selected ideas are further refined and detailed, without being finally executed. Prototypes may be created and evaluated, and technical specifications are defined to ensure the practicality of implementing the changes.
Selection phase: The options are presented to a wider action team that can make a fully informed decision about the cost/benefit implications across the entire product lifecycle and make definitive go-no-go decisions.
Implementation phase: The selected operational/process, product design, and material revisions are enacted in a controlled and systematic manner, respecting appropriate change-control methodologies.
Tools and techniques used in VA-VE
VA-VE is built on a foundation of systematic tools and techniques that help product engineers and manufacturers analyze product functions, costs, and risks to maximize value. By applying these tools, teams can make informed decisions that enhance product functionality while reducing unnecessary costs. Key techniques used in VA-VE include Function Analysis System Technique (FAST) diagrams, cost-benefit analysis, risk analysis, and design-to-cost strategies.
Function Analysis System Technique (FAST) Diagrams
The FAST diagram is one of the most essential tools in VA-VE, enabling teams to visualize and understand the relationships between the various product functions in terms of their hierarchical relevance in the end result. FAST diagrams map out how a product performs its intended functions, helping identify which functions are essential and which are secondary or redundant. The development of the diagram encourages discussion about these issues and the reaching of a priority consensus as a result.
In a FAST diagram, functions are represented in a hierarchical flow from left to right, and top to bottom—top left is the most critical. Functions are typically divided as highest-order technical (device performance) and design (ergonomics, aesthetics, human interfacial) functions.
To illustrate, in a car seat, the primary function is to support the occupant safely, while secondary functions like adjustment or providing comfort are direct descendants of the core function(s). The diagram helps the team focus on essential functions and explore alternative ways to achieve them more cost-effectively.
Benefits of FAST diagrams:
- They simplify complex systems by breaking them down into discrete functions that can be allocated a priority.
- They help teams uncover opportunities to combine or eliminate non-essential functions.
- They provide a clear roadmap for brainstorming cost-reduction ideas without adversely influencing critical performance priorities.
Cost-benefit analysis: Balancing value and investment
In VA-VE, cost-benefit analysis (CBA) serves to inform decisions as to the trade-offs between diverse design choices, and the impact of decisions on product value. The essential purpose is to validate that the benefits of a particular change or investment outweigh the associated costs.
Cost-benefit analysis involves:
- Identifying costs: These include materials, labor, overhead, development, and implementation expenses, any and all of which are likely to be influenced up or down by the process.
- Quantifying benefits: These are typically more difficult to make absolute, as they can include benefits in functionality, durability, performance, or end-user satisfaction.
- Comparing options: The team compares multiple alternatives to determine which provides the highest value for the investment.
For example, in a VA-VE initiative for an aerospace component, the designer might consider replacing a more common/lower cost of processing metal with a lighter composite material such as CFRP. While the composite will have a higher upfront cost, a cost-benefit analysis would necessarily take into account the long-term fuel savings due to the reduced weight and potentially lower maintenance costs, ultimately showing a positive return on investment.
Risk analysis in VA-VE: Avoiding pitfalls
Risk analysis is central to the VA-VE process, as any changes made to a product’s design, materials, or manufacturing processes integrate both inherent opportunities and risks that must be quantified in the early assessment phase – i.e. before actions are taken. In VA-VE, risk analysis helps identify potential product failures, occult cost increases, or schedule blowout potential.
Key steps in risk analysis include:
- Identifying risks: These could range from technical challenges (e.g., manufacturing defects, supply chain disruptions) to functional risks (e.g., compromising product performance or safety).
- Assessing the impact and likelihood: The team evaluates how likely each risk is to occur and the potential impact it would have on the product’s value or performance.
- Mitigating risks: Once risks are identified and their probability of occurrence evaluated, it’s necessary to develop strategies to mitigate against them. This involves testing prototypes, evaluating alternative designs/materials, or improving quality control measures.
For example, if a VA-VE exercise suggests switching to a lower-cost material for a high-stress component in an industrial machine, a risk analysis would be required to assess whether the new material could fail under heavy use — and what design changes might mitigate that risk. By conducting durability tests and working with suppliers to ensure quality, the risk can be reduced to acceptable levels, allowing the full realization of the cost savings.s
Risk analysis ensures that changes made during the VA-VE process do not lead to unforeseen problems, safeguarding product integrity, and customer satisfaction.
Design-to-Cost: Ensuring affordability without compromising functionality
Design-to-Cost (DTC) is a strategy within VA-VE that focuses on designing products with a target cost in mind. Rather than developing a product and then determining how much it costs, DTC involves setting a product cost target from the outset and making design decisions under the directives that goal imposes. This ensures that market positioning in price terms is baked in from the beginning, rather than being an afterthought that demands after- design cost savings (the VA process).
Key aspects of Design-to-Cost include:
- Setting a cost target: Based on market research, customer expectations, and competitor analysis, define the maximum acceptable cost for the product.
- Allocate the cost: It’s necessary to realistically allocate the available product-cost budget on a component, sub-assembly, and process basis for value to be realistically reflected throughout the product.
- Optimizing design decisions: Throughout the design process, engineers must make disciplined choices that deliver on functional requirements without exceeding the cost target.
- Collaborating with suppliers: Close collaboration with suppliers ensures that the materials and components selected can be produced within the cost parameters without compromising quality or performance. Early discussion of the per-component and per-sub-assembly target costs can be used as a reality check for feasibility before design/materials commitments are made.
Design-to-cost forces the development team to innovate within cost constraints, ensuring that product is delivered at the competitive price point, while delivering the high functionality and performance that cannot be sacrificed.
By employing tools like FAST diagrams, cost-benefit analysis, risk analysis, and design-to-cost, VA-VE empowers your product engineering and manufacturing with the freedom to explore smarter decisions that drive both value and cost efficiency.
