Value Analysis

Value Analysis (VA) is a problem solving and decisionmaking method with a proven track record of over fifty years of results in all areas of enterprise, worldwide. It yields extraordinary results because it…

If you have participated in VA studies, you may have been aware of some (or all) of the following shortcomings of conventional VA practice

Abstract unanchored “performance criteria” (factors) are fixed early in the study thus assuring that evaluation of alternatives will overstate minor advantages and understate major ones. Regardless of definition, significant overlap of these factors will occur leading to double counting and skewed results.
There will be an inability to recognize unique advantages of some alternatives if “performance criteria” (factors) related to those advantages have not been previously identified.
Team will be required to engage in the unsound practice of making paired comparisons of abstract and unanchored factors and to assign weights to them.
Team will be required to identify the advantages and disadvantages of alternatives even though this leads to overcounting, undercounting, and other errors.
Team will be required to abide by arbitrary rules such as limiting the number of factors to from five to seven, taking points from highly weighted factors to give to those scoring a zero weight, and working with evaluation scales that go from 1 to 10 (with no zero point).
Team is instructed to disregard factors that are subjective or cannot be quantified.
Creativity is limited by fixing factors early in the study thus assuring only ideas related to these factors will not be brought forward in brainstorming.
Alternatives will be evaluated on multiple scales as opposed to a single scale.
The weighted factors and rated alternatives will generate illogical preference curves.
“Value” ratios of “performance” and cost are used to determine higher and lower “values” of alternatives without regard to whether the alternatives being compared are mutually exclusive or non-exclusive.

In large measure, these problems occur because decisionmaking today is based on what are sometimes called Weight, Rate, and Calculate methods which claim to put weights on criteria, rate the alternative solutions against these criteria, and multiply the rating by the weight to establish the contribution to the total score for the alternative. This process is repeated for each criterion and results are totaled for each alternative. Read Mr. Adams' paper on improving value analysis studies with Choosing By Advantages Decisionmaking.

It has been shown, however, that the weighting of factors is impossible and why attempts to do so are unsound practices. This is the case primarily because such efforts force us to fill in lower level detailed information missing from high order abstractions and thus jump to conclusions. Sound decisions must be based on the importance of the differences among the actual alternatives – namely their real advantages. Enlign Consultants is unique in its use of CBA in value analysis studies. Read about Enlign's new Choosing By Advantages / Value Analysis training course.

Applications

VA has been applied to products, processes, and projects – in the public and private sectors – in all aspects of life and commerce – large and small, in the U.S. and abroad. In construction, for example, ratios of implemented savings to study costs are typically 20 or 30:1. In larger scale civil works, these ratios can exceed 100:1.

In a recent state property de-certification process study, VA not only helped to clarify roles and activities but also reduced total process time by 35%.

A Systematic Plan*

The VA process, or job plan, comprises the following steps any which may be repeated, if necessary, but not of which may be omitted:

* A brief explanation is provided for those steps most typically participated in by the VA facilitator and team.