The value methodology (also called value engineering, value analysis
or value management) is a powerful problem-solving tool that can reduce
costs while maintaining or improving performance and quality requirements.
It is a function-oriented, systematic team approach to providing value in
a product or service.
The value methodology helps organizations compete more effectively in local, national and international markets by:
- Decreasing costs
- Increasing profits
- Improving quality
- Expanding market share
- Saving time
- Solving problems
- Using resources more effectively
Value methodology easily produces savings of 30 percent of the estimated cost for manufacturing a product, constructing a project or providing a service. The return on investment that public and private organizations derive from implementing VM programs averages 10 to 1. That is, for every dollar invested in a VM study - including participants' time and implementation costs - $10 in net savings results.
Value methodology can increase customer satisfaction and add value to an organization's investment in any business or economic setting. Value practitioners apply the value methodology to products and services in industries such as the following: corporations and manufacturing, construction, transportation, government, health care and environmental engineering.
Since value methodology's invention in the 1940s, several other management approaches have caught the eye of business leaders: total quality management, quality function deployment, project management, concurrent engineering, re-engineering, benchmarking. The value methodology lends itself to use with other approaches, and its combined strengths - customer needs, teamwork, creativity and a rigorous system approach - rise above the strengths of other processes. The table below shows a comparison of each approach.
| Table 2 |
| Evaluation of the Focus of Each Approach |
|
|
VA,VE,VM |
TQM |
QFD |
PM |
CE |
R* |
B |
|
Customers' needs/satisfaction |
8 |
10 |
10 |
4 |
5 |
6 |
6 |
|
Multidisciplinary team |
8 |
10 |
8 |
6 |
7 |
9 |
6 |
|
Creativity |
8 |
- |
6 |
5 |
5 |
10 |
6 |
|
Rigorous system approach |
9 |
- |
10 |
6 |
7 |
7 |
6 |
|
Cultural/structural change |
6 |
10 |
6 |
4 |
6 |
9 |
8 |
|
Scope |
6 |
10 |
5 |
4 |
4 |
9 |
7 |
Source: Tahmazian, Berge. Quest for Value. Value World 21(2): 2-7 (June 1998).
"I am continually amazed by the impressive array of value proposals and recommendations that are developed when value methodology is applied to any and all programs, processes or projects. There is no limit to the utilization of the value methodology and no limit to the benefits that can be achieved."
Kurt Gernerd
U.S. Department of the Interior
SAVE International Vice President-Government
The value methodology works through a VM study that brings together a multidisciplinary team of people who own the problem and have the expertise to identify and solve it. A VM study team works under the direction of a facilitator who follows an established set of procedures - the VM job plan - to review the project, making sure the team understands customer requirements and develops a cost-effective solution.
The VM job plan includes pre-study and post-study phases, as well as the value study itself, which is composed of six phases:
- Information
- Function analysis
- Creative
- Evaluation
- Recommendation
- Implementation
SAVE International offers education, training and certification for value practitioners who facilitate VM studies. In addition, the society can help organizations find a VM practitioner by geographic location or specialty area.
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