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[Free Read] Reducing Process Costs with Lean, Six Sigma, and Value Engineering Techniques Full
Real option theory for risk mitigation in transport PPPs. BIM in the operations stage: bottlenecks and implications for owners. Government-led critical success factors in PPP infrastructure development. How is VE Applied? When is it used? Sourcing programs fall short Material cost is embedded in the product design.
Either way, the result is more value for the customer Excerpt from Purchasing Magazine - "Value Analysis makes a comeback," Jim Morgan, November 20, ". It is also used to improve organizational performance and cost effectiveness as well. Larry Miles takes VE to Japan. DC on Oct. 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.
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Lean is a time-based strategy and uses a narrow definition of waste non- value-adding work as any task or activity that does not produce value from the perspective of the end customer. Womack, Daniel T. Directly promotes and advocates radical breakthrough innovation. Emphasis on fast response to obvious opportunities. Stephen W. May not provide sufficient evidence of business benefit for traditional management accounting. Has a limitation when dealing with complex interactive and recurring problems uses trial and error problem solving.
Random variations result in inefficient operations causing dissatisfaction of customers from unreliable products and services. The data gathering provides strong business cases to get management support for resources. The focus on reduction of variation drives down risk and improves predictability. The heavy reliance on statistical methods by its very nature is reactive, as it requires a repetition of the process to develop trends and confidence levels. The strong focus on stable processes can lead to total risk aversion and may penalize innovative approaches that by their nature will be unstable and variable.
VE takes a systems approach to problem identification and problem solving. VE uses function analysis to improve communication among team members The function analysis systems technique FAST promotes a synergistic approach to problem solving that develops solutions far beyond that which only an individual could produce. VE uses a systems approach to problem identification and solution. Increased competitive advantage comes from the identification of innovative ways to accomplish key functions at a lower cost with improved quality and reliability.
Many times, VE is used too late in the product development cycle to impact the design, and when changes would be too costly to implement. There are many misunderstandings and biases against VE that have been built up over time due to misuse of the methodology. We do VE all the time. Lean can provide Value Stream information that can lead to improved quality and throughput.
In combination with VE, Lean and Six Sigma provide a suite of tools that can lead to superior value through innovative solutions to problems in design, quality, and productivity. Lean principles and practices offer no direct method of addressing product design. VE can work well as an isolated study event — it does not require the encompassing and pervasive level of support that an effective Lean effort requires.
Lean will reduce waste over time. VE, on the other hand, will find and fix wasteful effort very quickly, but it will generally not necessarily do so on an episodic basis, not a continuous or systematic basis. In Lean, a Kaizen team will consider using a variety of visual analytical tools to identify waste. Spaghetti diagrams, flow diagrams, bar charts, standard work sheets, and production control boards, are all part of the Lean analytical lexicon.
VE uses function analysis and FAST diagramming to describe the functional relationship of the product, process, or service and identify functions where the team should focus on improving value. Creating by function is the high-octane fuel generating VE performance and success.
Six Sigma - Wikipedia
B Organize an improvement team. B Define Performance Standards. C Validate the measurement System. Measure A Identify significant characteristics and establish process capability. B Define performance targets for significant characteristics. C Identify root cause of process variation. Analyze A Identify and evaluate potential solutions.
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. Improve A Verify corrective actions and validate new measurement systems. B Determine process capability. C Establish and implement control plan. Control End Move on to next highest priority process. Last 3 years FY — , 2. The U. Lean and Six Sigma alone are not enough!
Information Phase Creativity Phase Brainstorm ideas on how to improve the high cost, broken, or inadequately performed key functions. 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. Evaluation Phase 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.
Get management approval for go-ahead, make management plan, make assignments, implement, follow-up.
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Implementation Phase. Focus on maximum possible solution based on analytical optimization techniques. What facts are known? What are the requirements of the system? Are these facts, opinions, assumptions, or prejudices?
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