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Dear Cath,
I am preparing fro MCS so I am asking this question from that point of view.
Would you explain to me in a very simple way the difference between Value vs Functional Analysis? Something that will point me to the right direction at the case study exam if I am asked to do one or both of these?
I’ve researched and researched but I am getting more confused as many of the articles on the internet that start out as Value Analysis end up talking about functions of the product like how to eliminate non-value adding functions, and how to replace components with others that are cheaper but can perform the same function.
Please help!
Hello,
Yes they are very similar and can be confusing.
Value analysis is cost avoidance or cost reduction of a product already in production.
It aims to reduce the overall cost of the product by changing its materials or composition in a way that does not affect the quality or ‘value’ of the product.Value engineering – is the same except its done at the design/development stage of a new product’s life (rather than applied to existing products like Value Analysis)
Functional Analysis is similar to Value Engineering because it is done at the product design/ development stage.
Functional analysis is concerned with reducing costs by removing or altering ‘features’ of a product in a cost effective way.Consider if a company were trying to launch a new low cost mobile phone… they could apply a functional analysis to it at the design stage by listing all the possible functions that a phone can provide- e.g. making calls, sending text messages, browsing the web, sending emails, playing music etc.
Then by reviewing these functions – to make a very cost effective phone – they could remove any functions / features that the customer does not use or does not value enough to pay extra for. This strips their phone back to meet the need of the customer by removing any non-value adding extra features that are adding cost but not value.There is also a good article from CIMA on these differences:
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