Reducing Process Costs with Lean, Six Sigma, and Value Engineering Techniques
Features
- Presents Six Sigma cost savings techniques
- Discusses optimization techniques from Manufacturing Six Sigma
- Explains optimization techniques from operations research methods
- Considers cost savings with traditional Lean and Lean Six Sigma
Summary
A company with effective cost reduction activities in place will be better positioned to adapt to shifting economic conditions. In fact, it can make the difference between organizations that thrive and those that simply survive during times of economic uncertainty. Reducing Process Costs with Lean, Six Sigma, and Value Engineering Techniques covers the methods and techniques currently available for lowering the costs of products, processes, and services.
Describing why cost reductions can be just as powerful as revenue increases, the book arms readers with the understanding required to select the best solution for their company’s culture and capabilities. It emphasizes home-grown techniques that do not require the implementation of any new methodologies—making it easy to apply them in any organization.
The authors explain how to reduce costs through traditional Lean methods and Lean Six Sigma. They also present Six Sigma cost savings techniques from Manufacturing Six Sigma, Services Six Sigma, and Design for Six Sigma. The book also presents optimization techniques from operations research methods, design experiment, and engineering process control.
Helping you determine what your organization’s value proposition is, the text explains how to improve on the existing proposition and suggests a range of tools to help you achieve this goal. The tools and techniques presented vary in complexity and capability and most chapters include a rubric at the start to help readers determine the levels of competence required to perform the tasks outlined in that chapter.
Table of Contents
Introduction
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
A Brief Overview of Value Engineering
Product Life Cycle
What Is Value?
Cost Improvement Challenge
Cost Avoidance
Cost Reduction
Profit Improvement
Green and Corporate Stewardship Are the Same
The Case for Cost Reductions
Planning for and Managing a Value Improvement Project
Project Concept
Project Information
Project Business case
Conclusion
Saving Money with Homegrown Ideas
Rubric for Homegrown Ideas
Questions to ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Your People Matter
Laboratory Equipment
Production Equipment
Production Test Equipment
Logistics Material
Engineering
Marketing
Accounting/Finance
Procurement
A. Financial Determination
Brainstorming
Product, Process or Service Preparation for Critique
Numbers Count
Suspend Judgment
Build on Ideas
Mind Mapping
Selection Method
Weighted Matrix such a Pugh Matrix
Majority Decision
Voting Decision
Consensus
Rating
Delphi Method
Nominal Group Technique
Group Passing Technique
De Bono and his Thinking Hats
Advocacy and inquiry
Strategic Assumption Surfacing And Testing (SAST)
Team Syntegrity
Facilitation
ARBITRARY COST DOWN APPROACH
Rubric for Costing Down
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Why the Arbitrary Cost Down Approach
Cost Down Process
Cost Management Cycle
When to Use
The Greedy Approach
Cost Generators
Generators and Cost Cutting
The Isuzu Approach to Tear Downs
Rubric for Tear Downs
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
What is the Isuzu approach
Dynamic Tear Down
Cost Tear Down
Material Tear Down
Matrix Tear Down
Process Tear Down
Static Tear Down
Why use this technique
Tear Down Example
Design for Assembly
Value Analysis Contribution to the Tear down Process
Value analysis Tear down and Improvement/Innovation
Value analysis Tear down Method and its Components
Recognizing Parts Suppliers Competitive Capability
Collecting New Suggestions for Improvement
Case Study
The DOD Approach
Rubric for DoD Approach
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Benefits
Function
Worth
Cost
Value
Effective Value Engineering Programs
Cost Analysis
Variance Analysis
Ratio Analysis
Trend analysis
Management analysis
Classical Value Analysis / Value Engineering Techniques
Rubric for Classical Techniques
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Benchmarking
Is Benchmarking Valuable?
Performance Benchmarking
Benchmarking Process
Classical Techniques
Rubric for FAST Approach
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
FAST introduction
Creating a FAST model
Saving Money with Six Sigma Projects
Rubric for Six Sigma Projects
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
What is Six Sigma?
How Does Six Sigma Relate to Value Engineering?
The Phases of Six Sigma
Choosing Six Sigma Projects
Costing Six Sigma Projects
Using Design for Six Sigma
Rational Expectations From Six Sigma
Enterprise Process Management and Metrics
Define
Measure
Analyze
Improve
Control
Design for Six Sigma (DFSS) Frameworks and Methodologies
Saving Money with Lean Manufacturing
Rubric for Lean Manufacturing
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
What Is Lean?
Production Organization or 5S
Lead Time Reduction
Kanban
Demand Segmentation
Production Scheduling
Inventory Reduction
Lean Six Sigma
Lean Six Sigma Overview
Lean Six Sigma Goals
LSS Project Management
Team Organization & Dynamics
Defining Opportunities
Measurement Techniques
Analysis Techniques
Improvement Techniques
Control Concepts
Design Improvement
Saving Money with Optimization
Rubric for Optimization
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Operations Research Approaches
Evolution of Operations Research in Academics
Origin, History, and Developments
Operational Research Activities
The Operations Research Approach
Significance of Operations Research
Operations Research in Manufacturing
The Operations Research Experience in the US
Growth of Operation Research in Different Sectors
Challenges in Operations Research
Future Trends
Conclusion
Genetic Algorithms
Particle Swarm Optimization (PSO)
Ant Path Optimization
Simulations
Regaining Money with Cost Recovery
Rubric
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
What is Cost Recovery?
When to Use Cost Recovery
Benefits of Cost Recovery
Steps to Cost Recovery
Two-way Cost Recovery
Other Methods
Rubric for Other Methods
Questions to Ponder
Cost Improvement Scenario
Situation
Objective
Action
Results
Aftermath
Other Tools
Project Management
What is DFA?
Design for Manufacturing
Rapid Prototyping
Finding Cost Reductions
Rubric for Finding Cost Reductions
Questions to Ponder
Cost Improvement Scenario
Situation
Objectives
Actions
Results
Aftermath
Finding Cost Reductions in the Plant
Operations
Engineering
Accounting/Finance
Purchasing
Marketing
Project Management
Human resources
Finding cost reductions in the office
Office supplies
Equipment
Copies/printing
Paper/paperless
Finding cost reductions in education
Operations
Accounting/Finance
Purchasing
Project management
Human resources
Sports and Extra-curricular activities
Finding cost reductions on the personal side
Used versus new material
Quantity versus quality
Food
Clothing
Furniture
Housing
Vehicles
When Cost Improvement Goes Wrong
Rubric
Questions to Ponder
Cost Improvement Scenario 1
Situation
Objective
Action
Results
Aftermath
Cost Improvement Scenario 2
Situation
Objective
Action
Results
Aftermath
Cost Improvement Scenario 3
Situation
Objective
Action
Results
Aftermath
Material
Substitution is a poor fit
Bulb removal tool
Vehicle Diagnostics Connector
Supplier selection
Scope or Design Review
Drop in replacement
Reuse of material
