4 Ways to Master Value Engineering for Your Manufacturing Company
by Rob Zito on Tue, Apr 07, 2015 @ 01:57
Value in Engineering Cost Savings in Manufacturing” Lunch n Learn in March. Clark Neft, President of Barth Industries shared invaluable information on how manufacturers can save on costs and add value to client relationships.
A key objective for manufacturers is lowering costs while raising profits. Barth Industries has taken major strides to accomplish both of these objectives in recent years. Neft spoke specifically to ways value engineering can add intrinsic value your business during his presentation.
First, you may be wondering, what is value engineering and how it can impact your business. According to Wikipedia, value engineering is a systematic method to improve the value of goods or products and services by using an examination of function. Value, as defined, is the ratio of function to cost. By implementing a proper value engineering process, you should expect lower acquisition costs, shorter delivery time, and an overall lower total life cycle cost.
Below are 4 key takeaways on how manufacturers can master value engineering.
Create early relationships with your contract manufacturers in order to develop clear and concise communication on future project specifics.
Create designs that can reduce overall costs. Clark referenced a very small design change to brackets on a vertical conveyer that resulted in over a million dollars of savings for Barth Industries.
Share the books. Sharing your books with your client will establish trust and credibility to your relationship.
Working with the right team. Working with a client that has a great team organization structure will foster efficient communication between the client’s & manufacturer's program managers.
Manufacturers who implement these value engineering strategies will be able to save two precious commodities: Time & Money. For more information on what manufacturers can do with these savings to increase their revenue, check out a few blog posts below:
A big thank you to Barth Industries & Wire-Net for a great Lunch ‘n Learn. Throughout the year, Syncshow and Wire-Net will be hosting quarterly Lunch ‘n Learns that feature leading manufacturers showcasing the strategies that made them successful. We hope you can join us at the next series event on May 28th. For more details on the series visit Wire-Net’s event page here.