DFMA: SHOULD COSTING
DFMA: PRODUCT SIMPLIFICATION
What is value engineering?
Value engineering (VE) is a structured, function-based approach to improving the value of a product, process, or system. It was developed by Lawrence Miles at General Electric during World War II, when material shortages forced engineers to find alternative ways to deliver the same function—and they discovered the alternatives were often better and cheaper.
The central concept is value, defined as the ratio of function to cost:
VE works by identifying the functions a product must perform (expressed as verb-noun pairs like “transmit torque” or “seal fluid”), determining which functions are essential vs. secondary, and then finding the lowest-cost way to reliably deliver each essential function.
On this page
Value engineering vs. value analysis
These terms are often used interchangeably, but they describe the same methodology applied at different points in the product lifecycle:
| Dimension | Value engineering (VE) | Value analysis (VA) |
|---|---|---|
| When | During design and development, before production | On existing products already in production |
| Objective | Design value in from the start | Improve value of current designs |
| Cost of change | Low—changes are on paper/CAD | Higher—may require retooling, requalification |
| Typical savings | 15–40% of product cost | 10–25% of product cost |
| Approach | Proactive—prevent unnecessary cost | Retroactive—remove unnecessary cost |
The tools and process steps are identical. The key difference is that VE has more leverage because the design isn’t locked in yet. Both are valuable—but VE captures larger savings at lower cost-of-change.
Value engineering vs. cost cutting
This distinction matters because it determines whether cost reduction preserves or destroys product quality:
- Starts with function: what must this product do?
- Preserves or improves performance while reducing cost
- Challenges the design: can we achieve this function differently?
- Eliminates unnecessary functions, not necessary features
- Often improves quality, reliability, and manufacturability
- Starts with cost: how do we spend less?
- Reduces cost without systematic regard for function
- Accepts the design and squeezes: cheaper material, thinner walls
- Risks degrading performance, quality, and customer satisfaction
- Often creates warranty and rework costs that offset savings
The VE job plan
The VE job plan is the structured process that value engineering follows. It was formalized by SAVE International and is the standard methodology worldwide:
Gather all relevant data: design intent, specifications, current cost, manufacturing process, performance requirements, customer needs, and constraints. Understand what the product does and what it costs to do it.
Identify and classify every function the product performs. Express each as a verb-noun pair. Distinguish primary functions (why the product exists) from secondary functions (how it achieves its purpose). Build a FAST diagram. Assign cost to each function.
Generate as many alternative ways to achieve each function as possible. No evaluation at this stage—quantity over quality. Consider different materials, processes, geometries, architectures, and part-consolidation strategies.
Screen and rank alternatives against criteria: cost, function, feasibility, risk, and implementation effort. Eliminate ideas that don’t meet requirements. Use should-cost analysis to quantify the cost of each viable alternative.
Develop the top alternatives into detailed proposals with cost estimates, implementation plans, risk assessments, and design specifications. Build the business case for each recommendation.
Present recommendations to decision-makers with supporting cost data, function analysis, and implementation plans. Track implementation and verify that projected savings are realized.
Function analysis & FAST diagrams
Function Analysis System Technique (FAST) is the analytical engine of value engineering. FAST diagrams map every function a product performs and organize them using how/why logic:
- Each function is expressed as a verb-noun pair (e.g., “transmit torque,” “seal fluid,” “resist corrosion”)
- Reading left-to-right answers “How?”: how is this function achieved?
- Reading right-to-left answers “Why?”: why is this function needed?
- Functions that can’t answer “why?” at the product level are candidates for elimination
- Which functions are essential (the product fails without them)
- Which functions are secondary (supporting, aesthetic, or convenience)
- Which functions are unnecessary (legacy features, over-engineering, redundancy)
- Where cost is concentrated relative to functional importance
The power of FAST is that it forces teams to separate what the product does from how the current design does it. Once you see the functions clearly, you can evaluate whether the current design is the best way—or even a necessary way—to deliver each one.
How DFMA supports value engineering
Value engineering identifies what to change. DFMA quantifies the cost impact and validates that the change works. Together, they form a complete system for improving product value:
- DFA’s minimum-part-count criteria ask the same question VE asks: does this part need to exist separately?
- Parts that don’t meet the criteria are candidates for elimination or consolidation
- Assembly-time estimates quantify the cost of each part’s presence in the product
- DFA index benchmarks overall design efficiency
- Process-based cost models show exactly what each remaining part costs and why
- Cost breakdowns (material, cycle time, setup, tooling, secondary ops) identify which design features drive cost
- Process comparison evaluates alternatives with real numbers
- Transparent assumptions make VE recommendations defensible
| VE phase | What DFMA provides |
|---|---|
| Information | Baseline part count, assembly cost, per-part manufacturing cost breakdown |
| Function analysis | DFA minimum-part-count criteria identify which parts are functionally necessary |
| Creative | Part consolidation opportunities, alternative process options, material substitution scenarios |
| Evaluation | Should-cost estimates for each alternative, head-to-head cost comparisons |
| Development | Detailed cost models for recommended designs, savings quantification |
| Presentation | Transparent, auditable cost data that supports the business case |
Worked example: VE on a pneumatic valve assembly
Here’s an illustrative value engineering study on a pneumatic valve assembly, showing how function analysis and DFMA data combine to deliver measurable savings:
| Metric | Before VE | After VE | Change |
|---|---|---|---|
| Part count | 24 parts | 11 parts | −54% |
| Assembly time | 185 seconds | 78 seconds | −58% |
| DFA index | 9% | 51% | +42 pts |
| Manufacturing cost | $34.60 | $19.80 | −43% |
| Unique fastener types | 5 types | 1 type | −80% |
Key VE decisions that drove the savings
A decorative cover (3 parts + 2 fasteners) existed for aesthetic reasons on a valve installed inside a cabinet. Function analysis showed it served no customer-facing purpose. Eliminated entirely.
Body, end cap, and mounting bracket were three separate machined parts. DFA analysis showed no functional reason for separation. Redesigned as a single die-cast part, eliminating 4 fasteners and 2 seals.
Values are illustrative. Actual results depend on design, volume, and manufacturing assumptions. DFMA provides the cost models and part-count analysis for your specific product.
When to apply VE / VA
| Timing | Application | Typical savings |
|---|---|---|
| Concept design | VE on product architecture: part count, materials, process selection | 20–40% |
| Detail design | VE on individual parts: geometry simplification, tolerance optimization | 15–30% |
| Pre-production | VA to catch remaining opportunities before tooling commitment | 10–20% |
| Existing products | VA on high-volume or high-cost products for continuous improvement | 10–25% |
| Competitive teardown | VE/VA on competitor products to benchmark design efficiency | Benchmarking data |
Industries that use value engineering
VE is often required on DoD programs. SAVE International methodology is the standard. Focus on weight reduction and function optimization alongside cost.
OEMs and tier-1 suppliers run VE workshops on high-volume components. Part consolidation and process optimization drive the largest savings at automotive volumes.
Federal and state DOTs mandate VE studies on projects exceeding cost thresholds. Focus on materials, methods, and lifecycle cost.
Reimbursement pressure makes VE essential. Function analysis ensures cost reduction doesn’t compromise safety, efficacy, or regulatory compliance.
Complex assemblies with long product lives benefit from VE to reduce cost, simplify manufacturing, and improve serviceability simultaneously.
Tight retail price points and short product cycles demand rapid VE. Part consolidation and process optimization are the primary levers at high volumes.
Frequently asked questions
What is value engineering?
Value engineering (VE) is a systematic method for improving the value of a product by analyzing its functions and finding ways to deliver those functions at lower cost—without sacrificing quality, reliability, or performance. Value is defined as the ratio of function to cost: increase function, reduce cost, or both.
What is the difference between value engineering and value analysis?
Value engineering is applied during design and development, before production begins. Value analysis is the same methodology applied to existing products already in production. The tools and process are identical; the difference is timing. VE is proactive, VA is retroactive.
What is the difference between value engineering and cost cutting?
Cost cutting removes cost without regard to function—cheaper materials, thinner walls, fewer features. Value engineering preserves or improves function while reducing cost. VE asks “what does this part do and what’s the least-cost way to achieve that function?” Cost cutting asks “how do we make this cheaper?” The outcomes are fundamentally different.
What is a FAST diagram?
FAST (Function Analysis System Technique) is a diagramming method used in value engineering to map the functions of a product or assembly. Functions are expressed as verb-noun pairs (e.g., “transmit torque,” “seal fluid”) and organized by how/why logic. FAST diagrams reveal which functions are essential and which are secondary, helping teams focus cost-reduction effort where it matters most.
How does DFMA support value engineering?
DFMA provides two capabilities that value engineering requires: (1) DFA analysis identifies unnecessary parts and quantifies assembly cost, directly supporting the VE goal of eliminating functions that don’t add value; (2) DFM analysis provides transparent, process-based cost breakdowns for each part, so VE teams can see exactly which design features drive cost and evaluate alternatives with real numbers.
What industries use value engineering?
Value engineering is used across manufacturing, construction, aerospace and defense, automotive, medical devices, and government procurement. It originated at General Electric during World War II and was formalized by Lawrence Miles. The U.S. federal government requires VE on projects exceeding certain thresholds, and many state DOTs mandate VE studies on highway and bridge projects.
Put numbers behind your value engineering
Bring an assembly. We’ll run the DFA part-count analysis and DFM cost breakdowns—so you can see exactly where the function-to-cost ratio breaks down and which design changes deliver the most value.
