As engineers, we live in very challenging and exciting times. We work with new products, new technologies, new materials, lasers, the Intemet, and travel in space. We measure things in micrometers (one millionth of a meter) and nanometers (one billionth of a meter), and we construct ml'croelectromechanical products, (ones that you place under a microscope to see them operating). We are creating new markets, global markets and markets without borders.
These global markets, however, are becoming increasingly crowded. The competition for market share is intense, and companies are increasingly dependent on innovation to develop and market their products. New technologies are a crucial factor in the success of private corporations, in the effectiveness of government operation, and in the vitality of national economies. Faced with that fact, the United States has dedicated immense resources to the discovery and development of advanced technologies.
The U.S. National Research Council's 1987 report, entitled Management of Technology, The Hidden Competitive Advantage, states " Technology can provide a firm with the critical competitive advantage in the global marketplace."
One should remember, however, that developing new technology alone is no guarantee for success, for when technology succeeds it is more due to economic reasons than technical ones. David Adamson, in his book Walking The High-Tech, High Wire, states," Years ago the management expert Peter Drucker said that a technology has to have a 10 to 1 cost advantage for it to have a chance to alter the existing structure of an industry." He goes on to say" A good example of this is DuPont's Kevlar, a material that is superior to nylon in strength. DuPont hoped Kevlar would find its way into every tire on every car in the world. Instead, it only found a small number of markets for this material such as in skis and in bulletproof vests."
Another example is the use of robots to perform tasks in factories, offices and homes. In the early 1980s, many companies thought that the market for robots would be large. The technology was there, but the cost turned out to be too high. The economics drove many of these companies out of the business, and now there are only few companies that manufactme robots. Thus new technologies and economics must go hand in hand.
The profession of industrial engineering is set apart from other engineering disciplines by its broad scope. An industrial engineer relates to the total picture of productivity. In fact, everything an industrial engineer does, in the final analysis, is aimed at improving productivity.
In its broadest sense, productivity is the ratio of results attained to resources utiliTed, output to input.
Output could be in the form of physical products, something easily defined and measured, or in the Selected papers from the 22nd ICC&IE Conference 383 GE had significant success with this technique. That success, of being able to yield significant returns on a relatively modest investment, was instrumental in the quick spread of VE throughout private industry. Government was quick to take advantage of value analysis. In 1954, the U.S. Navy Bureau of Ship Building became the first federal agency to use this technique. By 1961 VE was formally used throughout the Defense Department. Other federal agencies, such as the Department of the Interior, the postal service, the Veterans Administration and NASA were quick to follow.
Although VE was used fLrst on manufactured products, people soon realized that this methodology was just as applicable to the design and service process as it was to manufactured products. The Department of Defense was the fast to establish a formal program to subject their design and construction projects to VE. By 1956 the three services had established and appointed fuR-time value engineers.
Value engineering is not: * What a good designer does anyway. * Merely a review to eliminate "gold plating." * A good, old-fashioned cost reduction. * A method for reducing costs through degrading performance.
* Intended as a reflection on the competence of the designer. * An effort to trade off essential functions to cut costs.
The fact that unnecessary costs are generally found in products and processes is undisputable. Lawrence D. Miles concluded that unnecessary costs may be due to habits and attitudes, lack of sufficient time for design, lack of information, lack of ideas, preconceived ideas, prejudice, temporary circumstances, lack of experience, failure to use available specialists, lack of communications, multiple meaning, desire to conform, and/or fear of personal loss. The issue is to find a suitable costreduction program that will help discover unnecessary costs.
Most of the cost reduction programs (such as peer reviews, fast tracking, design to cost, design review, system and trade off analysis, or competitive biding) have some common characteristics. They may include one or more of the following: * Structur~ and systematic format * Retention of scope * Retention or improvements of quality * Predictable cost reduction * Organizational training * Life cycle consideration * Interdisciplinary team approach