Innovation & Rnd Management: Value Analysis/value Engineering & New Product Development

Innovation & RnD Management Value Analysis/Value Engineering & New Product Development 1

DR. SRI BRAMANTORO ABDINAGORO

INDUSTRIAL PROJECT MANAGEMENT DEPARTMENT OF METALLURGY & MATERIALS FACULTY OF ENGINEERING-UNIVERSITY OF INDONESIA

2018

Humor in Product Design 2

As the customer wanted it.

© 1984-1994 T/Maker Co.

As Operations made it.

© 1984-1994 T/Maker Co.

POM - J. Galván

As Marketing interpreted it.

© 1984-1994 T/Maker Co.

As Engineering designed it.

© 1984-1994 T/Maker Co.

What is a Product? 3

 Need-satisfying offering of an organization  Example P&G

does not sell laundry detergent P&G sells the benefit of clean clothes  Customers buy satisfaction, not parts  May be a good or a service

POM - J. Galván

Product Strategy Options 4

• Product differentiation • Low cost

• Rapid response

POM - J. Galván

Generation of New Product Opportunities 5

    

Economic change Sociological and demographic change Technological change Political/legal change Changes in  market

practice  professional standards  suppliers and distributors

POM - J. Galván

Product Components 6

Product

Brand (Name)

Physical Good

POM - J. Galván

Product Idea

Features

Package

Quality Level

Service (Warranty)

Value Engineering the Forgotten Lean Tool 7

 Value Engineering (VE) is an intensive, interdisciplinary

problem solving activity that focuses on improving the value of

the functions that are required to accomplish the goal, or objective of any product, process, service, or organization.  VALUE METHODOLOGY

“The systematic application of recognized techniques

which identify the functions of the product or service, establish the worth of those functions, and provide the necessary functions to meet the required performance at the lowest overall cost.” John M. Bryant, VM Standard, Society of American Value Engineers, Oct. 1998

Concept of Value 8

FUNCTION

VALUE = COST

When is VE used 9

 Value Engineering is used to determine the best design

alternatives for Projects, Processes, Products, or Services

 Value Engineering is used to reduce cost on existing

Projects, Processes, Products, or Services.

 Value Engineering is used to improve quality, increase

reliability and availability, and customer satisfaction .

 Value Engineering is also used to improve

organizational performance.  Value Engineering is a powerful tool used to identify problems and develop recommended solutions.

Six Sigma Process Define the Problem

Measure

Analyze

10

 A) Identify what the customer wants.  B) Organize an improvement team.  C) Create a process flow chart - (SIPOC)    

A) Select “Critical to Quality Characteristic” metrics. B) Define Performance Standards. C) Validate the measurement System. D) Establish baseline performance in terms of Sigma Capability Defects per Million Opportunities.

 A) Identify significant characteristics and establish process capability.  B) Define performance targets for significant characteristics.  C) Identify root cause of process variation.

 A) Identify and evaluate potential solutions. Improve

Control

End

 B) Implement short-term countermeasures.  C) Implement long term corrective actions.  D) Identify systemic indirect effects and unintended consequences of improvement ideas.  E) Establish operating tolerances for new process.  A) Verify corrective actions and validate new measurement systems.  B) Determine process capability.  C) Establish and implement control plan.  Move on to next highest priority process.

Competitive Advantage 11

 Quality is defined as “conformance to specification.”  Value is defined as:

Function

Cost

 You can’t have one without the other!

 Competitive Advantage = Quality + Value

Six Step Value Engineering Job Plan Information Phase

Clearly identify the problem(s) to be solved, and 12 gather information on the background, functions and requirements of the product, process, or system.

Creativity Phase

Brainstorm ideas on how to improve the high cost, broken, or inadequately performed key functions.

Evaluation Phase

Screen ideas for acceptance, score remaining ideas on a scale and group ideas into categories. Develop design scenarios, and selection criteria. Rate and rank ideas.

Planning Phase

Plan how to sell ideas to management, identify key recommendations, plan management presentation.

Reporting Phase

Give oral presentation to management, or develop written report.

Implementation Phase

Get management approval for go-ahead, make management plan, make assignments, implement, follow-up.

Mapping VE to 6 VA/VE

 Value-based decision process  Uses functional approach

 Follows a very structured, organized plan Focus on maximum possible solution based on creativity techniques.

6 13

Information Phase

Define the Problem

Value-based decision process

Creativity Phase

Measure

 Uses statistical approach

Evaluation Phase

Analyze Planning Phase

Reporting Phase

Implementation Phase

Improve

Control

 Follows a very structured, organized plan

 Focus on maximum possible solution based on analytical optimization techniques.

Michael Mladjenovic - Intier Automotive Interiors, Toronto, CA

VE Job Plan with 6

Michael Mladjenovic - Intier Automotive Interiors, Toronto, CA

14

How and When is Value Engineering Applied? 15

How  Interdisciplinary Team  Formal Job Plan  Trained Facilitators  Function Analysis/FAST  Documentation

When  Problem Solving/Decision Analysis  Strategic Planning  New Product Development  Re-engineering efforts

Customer Oriented FAST Model Vacuum Cleaner 16 WHY

HOW Basic Functions Receive Air

Move Air

Accelerate Air Clean Air Loosen Dirt

Clean Surface

Remove Dirt

Entrain Dirt Convey Dirt

Store Dirt

Entrap Dirt Collect Dirt

Supporting Functions

Display Directions

Simplify Directions Furnish Instructions

Clean Exterior

Assure Convenience

Facilitate Upkeep

Clean filter Dispose Dirt Signal Bag Change

Aid Service Minimize Storage Enhance Portability

Assure Dependability Satisfy User

Potential Savings from VE 17

No engineering Change Revision

Document Revision

Re-Test/Re-qualification

Drawings Released

Tooling Changes

Net Savings from VE

Total Cost of VE Implementation

VE Implementation beyond this point results in a net loss.

Concept

Design

Engineering &Production Release

Production

Why use Value Engineering? 18

Save Save

Time Money

Build

Teamwork

Improve

Quality

Satisfy

Customer

VE Task Team/Quality Process Improvement Team 19

Core Team Support

Support

Support

Support

Support

Support

5 to 8 PARTICIPANTS OPTIMAL

The Synergistic Effect of Value Analysis/Value Engineering 20

INFORMATION HELD BY ONE MEMBER ONLY

INFORMATION HELD BY TWO OR MORE MEMBERS

INFORMATION OR EXPERIENCE COMMON TO ALL

Concepts of Value - Desirable 21

Ideal

Value =

Good

Function Cost

Acceptable

Function Cost

Passable

Concepts of Value - Undesirable 22

Undesirable but Passable (cheapening the product)

Value =

Function Cost

Function Cost

Your Homeworks... 23

 Looking for examples :  2 (two) “new” products that you analize with VAVE..  2 (two) companies ( 1 Indonesia company & 1 International company) who have R&D function intensively and explain it