Value Engineering From the Very Start

(Manufacturing.net, 10 February 2012)

In Brief: Like Six Sigma and Lean Product Development, Value Engineering is a methodology used by companies to assure the greatest functionality is provided at the lowest cost. Although the discipline is often used to redesign existing products, this writer says that “true Value Engineering focuses on maximizing the function-cost balance from the very inception of the product concept.”

Our View: R&D organizations with above-average, on-time project completion rates enjoy operating margins 15% higher than industry peers. Most companies develop more rigorous stage gates and increase project management discipline, only to find that results may need changing because customer needs were misdiagnosed, delaying speed-to-market. Progressive companies, instead, focus on understanding customer needs at the earliest stages. They continuously integrate knowledge outside the gate review process to execute faster without wasting resources.