Value analysis involves ascertaining the best way to make a business productive with the least amount of capital and without sacrificing quality. You can use this type of analysis to evaluate products, plans, processes, systems, procedures, machines, equipment, tools, services or systems. The analysis needed to compute all the data and come up with a viable working configuration is often complicated and time-consuming. Value analysis requires expertise in procurement, maintenance, usage, feasibility and cost analysis.
The analyst's job is to evaluate and fully understand the subject that she is studying. In many cases, the subject analyzed is expensive and not effective. For example, the main function of a product is also generally the main goal of the product. The added extras associated with the product are generally secondary to the product’s primary function. It is important to express this function with as few words as possible. Ideally, you would use two words -- a verb and a noun. For example, you could explain the function of a process as "make widgets." The noun and the verb fully explain the primary purpose of the process. After the analyst fully understands the function, he can find solutions for the function’s inefficiencies.
Information is the cornerstone of good analysis. The accuracy of the data will determine the effectiveness of the analysis. The analyst should, above all, be objective about everything. This objectivity will help when during the data collection process. According to Kenneth Crow of DRM Associates, the main function is always the most important piece of information gathered. The value of this function is of secondary importance to the function itself. The ultimate goal of the analysis, however, is the cost of the function and how you can reduce this cost.
After establishing the main function, the next step is analyzing the cost of the function. If a secondary function exists, analyzing the benefits of eliminating the secondary function is often a consideration. If the secondary function does not contribute to the primary function, it is often considered a waste. The analyst should always use a numerical value to express the cost of the function. For the purposes of this process, stating that an item is “much cheaper” or “more expensive” means absolutely nothing. Every measurement should have useful and quantitative information.
Objective and Evaluation
The objective of this process is to find a more productive way to achieve the main function. If a more productive way is found, re-evaluate this new method. The evaluation always has to be practical. Always make decisions based on facts and not opinions. Additionally, identify possible barriers and eliminate them systematically. Finally, substantiate all information with numbers, facts, and accurate information based on evidence.