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Value Engineering for Cost Reduction

Value engineering is a scientific method used to lower the costs of existing vehicle models through value analysis. It involves carefully examining each vehicle component to find substitute parts or processes that cost less while maintaining the same performance and value for customers. The Maruti Alto is an example where a cross-functional team approach helped significantly reduce prices through collaborative cost reduction efforts across different business divisions like supply chain, engineering, and marketing.

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nishant
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20 views1 page

Value Engineering for Cost Reduction

Value engineering is a scientific method used to lower the costs of existing vehicle models through value analysis. It involves carefully examining each vehicle component to find substitute parts or processes that cost less while maintaining the same performance and value for customers. The Maruti Alto is an example where a cross-functional team approach helped significantly reduce prices through collaborative cost reduction efforts across different business divisions like supply chain, engineering, and marketing.

Uploaded by

nishant
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Value Engineering

  Working with Suppliers on Cost Down, Value Analysis - Value Engineering


Value Analysis & Value Engineering is the name of the scientific method adopted to 
achieve focused cost down of existing models. It involves scrutinizing the vehicle and
every component closely, and seeking substitute products or processes that cost less but
deliver the same performance to the customer.

   
  Alto - example of Cost Down
Alto is a shining example where Maruti was able to cut down the prices drastically through  
collaborative efforts. A cross-functional team (CFT) was formed involving people from
different business functions like Supply Chain, Engineering and Marketing Divisions.

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