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284 Techniques of Value Analysis and Engineering
and the phase of the game, these men will be placed somewhat differ-
ently and will play under instructions to put emphasis on particular
activities. Much the same occurs in business. The organization must
possess an appropriate amount of competence, or else it will fail. But the
men who make up this competence must vary their activities to meet
the greatest pressures and thus produce results in those areas in which
action is most needed. To motivate a business to organize for high value
content in its products, a "force of necessity" is normally required. It
must be vital to the business to accomplish value objectives in addition to
performance objectives, shipment objectives, and other goals.
A corresponding force is often created by a forward-planning manage-
ment which, when it sees a threatening situation developing, proceeds to
generate emphasis for effective actions to prepare the business to meet
the situation when, perhaps years hence, the time arrives.
In the absence of either of these two forces, motivation is usually in-
adequate to cause steps to be taken to establish and execute a program
which will provide for leadership in value.
Managers
Decision Makers
Each decision maker has specific measured responsibilities; for instance,
he may sell the product, design the product, manufacture certain quan-
tities of specification-grade product, provide metered quantities of ma-
terials of appropriate grade to the factory, or reach certain inventory-
investment objectives.
EMPHASIS:In all cases, emphasis is very real and measurement is very
direct. If these people are to invest important segments of their time in
working out value alternatives, "debugging" them, testing them, and
taking the necessary chances which always come with any change, they
must interpret the emphasis on these tasks to mean that accomplishment
therein is as important a part of their work as the measured part.
MINIMUM-PERSONAL-LOSS ENVIRONMENT: The reader was alerted in an
earlier chapter to the importance of eliminating the personal-loss factor
if decisions to produce better value are to be expected. Experience
woyld indicate that the motivation to produce effective results in the
improvement of value by decision makers is affected by extremely large
plus or minus factors according to the effectiveness with which manage-
ment handles this phase.
MEASUREMENT OF ACTION AND LACK OF ACTION:Nearly every phase of
human nature promotes a negative decision on the part of the decision
maker. If the value alternative can be rather promptly ruled out on
plausible grounds, the decision maker is then at liberty to return to his
major measured field of activity without having suffered personal loss.
To provide reasonable motivation for action, measurements are needed
which will clearly highlight lack of action. As soon as a fair and sup-
portable measurement of lack of actioq is provided and accepted, the
personal-loss factor is increased by negative rather than positive actions
and significant increases in motivation result.
UNDERSTANDING OF FAILURE:In normal activity, success does not result
100 per cent of the time. In some of the projects of studying value alter-
natives, making models, testing, developing new vendors, and proving
new processes, results will be found to be negative. Meanwhile, an im-
portant amount of time and of money may have been spent upon the
project. It is never known before this work is done whether the result
will be an important accomplishment or not. It is important, therefore,
that management clearly show itself ready to stand back of, support, and
understand the effort when it judges alternatives that had a fair trial but
did not work out.
RECOGNITION OF SUCCESS: The earnings position of the company will
be greatly benefited from time to time by specific activities in the area of
value improvement. Important motivation will be provided and future
results will be greatly enhanced if clear recognition of successes is given.
Motivation, Measurement, and Tests 287
16-2 Measurement
Measurement of Organizations
In engineering
In manufacturing methods
In purchasing
The job of value analysts is to get today's and tomorrow's mate-
rials, ideas, methods, and processes into use today. If they operate
properly, they will use all of the resources in the entire country
in this program.
M e a s u r e m e n t of V a l u e W o r k
Each of the four types of work comprising the value analyst's work
should be measured separately, and in general, measurement should be
both of the amount done and of the amount not done. The four types of
work, the reader will recall, are integration, value appraisal, consultation,
and training.
INTEGRATION: The manager to whom value consultants or analysts
report should set up with them listings of all persons on the organization
who have certain important information about the plans of operation of
the value analysts. In large organizations, these lists may best show the
name of the activity rather than the name of the individual, together
with the number of people involved in each case. At the end of report
periods, which might each be ninety days, the work done and the work
still to be done should be shown in order to provide the various men or
the various groups of men with proper understanding. The quality of the
understanding which is being secured by typical men of the various
groups indoctrinated should be evaluated. On this basis, replanning to
provide the additional understanding can be done.
VALUE APPRAISAL: Wrong measurement is a worse deterrent than no
measurement to the establishment of any sound activity. It often hap-
pened in earlier value work that a traditional form of measurement,
which provided definitely deceptive results, had been used. More re-
cently, the shortcomings of this type of measurement are being realized,
and it is being ended. It is definitely incorrect to measure value con-
sultants or value analysts, who use the value analysis techniques and
special knowledge for the purpose of identifying unnecessary cost, by
the amount of savings which result from their value alternatives. The
reader will be quick to recognize that savings are the result of good
value alternatives plus effective decisions and actions by entirely dif-
ferent people. First, the value men act to provide value alternatives; then
the decision makers act to either implement the suggestions or not
implement them. True, the tangible benefit to the business is the result
of the actions of these two groups in series, namely, the decrease in cost
and the added earnings which actually result. However, it is fallacious
to use this outcome as an indication of the quality of the value alterna-
Motivation, Measurement, and Tests 293
measurement period and the consultation which has not been done. In
other words, these questions should be raised:
On what jobs was consultation done?
On what jobs was consultation not done?
For what men, or groups of men, was consultation done?
For what men, or groups of men, was consultation not done?
A progressive study of this type for each of a few report periods
provides vital information to show where more consultation is required
and also where more integration knowledge and understanding must be
provided to men in other work areas.
Reports of consultation work should contain memorandum statements
of activities involved in consultation, such as, "assisted engineer Smith by
locating for him a double-range thermocouple of smaller size, greater
accuracy, and lower cost than the product previously used."
The report will show the number of times the consultants were invited
into each area and the activities resulting.
TRAINING: In regard to training, it is again most significant to have
clear-cut information showing what training has been done and what
training has not been done. Plans will be prepared to include all the
people who should have training, either by name or, in large organiza-
tions, by groups and numbers in each group. A suitable rate will be
established, and a suitable schedule for training will be prepared. This,
then, will allow measuring the actual training against the plan. When
desirable, the plan should be adjusted at each measurement period to
account for changes in emphasis, shifts in business, or new information
of diverse types.
16-3 Tests
It is important to know whether the men being taught are learning. If the
men are not learning, the trainer is not teaching. For this purpose, tests
should be provided to ascertain whether those purported to be receiving
training are indeed learning the fundamentals which they will require to
effectively carry out their value work.
Periodically, perhaps once each year, a study should be made of the
value analysis work content in each of the main areas of the business,
such as sales, engineering, manufacturing, purchasing, and management.
In studying each area, it is important to examine separately the actions
on the four different types of work; for example:
Has suitable integration been completed? If not, what is the status and
what plans should now be made?
Motivation, Measurement, and Tests 295
Tests of Men
24. Does the result of all of this search, accumulation of information, ac-
cumulation of thinking, creative work, and preliminary judgment now
go to the man who is responsible, for his decision, follow-through,
further study, test, and implementation?
25. In any step, is the project scheduled back, as often as may be re-
quired to accomplish the objective, into an earlier step, such as back
for more information, more analysis, more creativity, etc.?
SUMMARY
To allow profit-making results to the business, essential motivation must
exist for the managers, the men using the value analysis system, and those
making decisions. Negative factors and demotivators for this group must
also be made minimal.
The searching, thinking, and communicating work essential to suc-
cessful value work is well spelled out. A very valid means for determining
the success that may be expected from value analysis people on the diffi-
cult tasks is to review their activities. Are they doing it?
Means for determining the effectiveness of the decision makers, when
dealing with decisions that mean change for the purpose of reducing
costs, are needed. This is essential work of top management dealing in
products or services in a highly competitive field.
Sometimes, alas, people who have not learned the value analysis sys-
tem apply the name value analysis or value engineering to the cost-
reduction-oriented work they are doing. A twenty-five-question review
schedule is provided in this chapter to assist all people under all condi-
tions in determining whether the value analysis system is, in fact, being
used.