Value Analysis: A Technique for Implementing Systems Thinking in the Organization

With the accelerating cost of manufacturing and the consumer's desire for a new or better product, more need is placed on the department or subsystems within an organization to minimize individual power struggles that result in organizational suboptimization. Systems such as MRP have been developed to control material requirements, and resource allocation systems have been employed to make more efficient use of resources and personnel assignment systems. Worker productivity techniques have been developed and implemented to maximize use of available workers and increase work performance. Most organizations have overlooked a technique called value analysis for making decisions which encourages interdepartmental agreement on goals which result in lower costs and/or improved products or services. This paper describes the systematic process by which value analysis can be applied in an organization to provide a new item or better service using interdepartmental inputs and considerations in order to achieve reduced cost and improved quality.