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88 Techniques o f Value Analysis and Engineering
3.
Use information from only the best source.
Blast, create, refine.
4.
5.
Use real creativity.
Identify and overcome roadblocks.
6.
7. Use industry specialists to extend specialized knowledge.
8. Get a dollar sign on key tolerances.
9. Utilize vendors' available functional products.
10. Utilize and pay for vendors' skills and knowledge.
11. Utilize specialty processes.
12. Utilize applicable standards.
13. Use the criterion, "Would I spend my money this way?"
8-1 Avoid Generalities
All too frequently a good idea or proposition is swept aside by a good-

sounding generality such as, "The farm is no good-never has been and
never will be." This statement stops buyers, excludes investigation, and
prevents change. Assume that we ask, "Specifically, what is wrong?" Per-
haps it will be found that $1,000 worth of limestone will make it the best
farm in the township.
Similarly, "This field won't grow potatoes. They never are any good;
they have hollow centers. Don't waste any time or money trying to grow
potatoes on it," By specifically inquiring why it won't grow potatoes, we
might find that $5 worth of magnesium sulfate will make it top-grade
potato land.
Such general statements stop progress in somewhat the same way that
fog stops traffic. Although there is not necessarily any tangible obstruction
in a fog, as a dense, unmanageable curtain it constitutes a good stopper.
It is so general and so diverse that problems, if any, within it cannot be
seen; nor is there any assurance that the fog shrouds no problems.
In industry, one commonly meets with generalities such as the follow-
ing:
1. "Every detail of the design of this device has had a thorough review
by a special, high-competence review team."
2. "The best manufacturing specialists in the United States have re-
viewed this and agreed that these manufacturing methods are the best
and most economical."
3. "It's not practical to build dies for drop forging when quantities are
less than 25,000 per order."
4. "It's not practical to build molds for casting in quantities of less than
5,000."
5. "We had to make these parts by hand because we can't pay for the
tools with the quantities involved."
Results Accelerators 89
6. "We've made a thorough study of every conceivable way of doing

this, and what we have is the only way it can be accomplished."
Recognizing every generality as a force for continuing the status quo,
the first step must be to eliminate the generality by coming to grips
specifically with "man-size" integers of the problem.
As an example, let us see how we may deal with generalities 1
through 6.
1. First, we must establish precisely what the over-all function is, and
also what the partial functions are. By then intensively studying a specific
function which is being accomplished, the "fog" will be penetrated. Alter-
natives which reliably accomplish the specific functions or subfunctions
for lower costs will suggest themselves.
2. In this case, we must inquire specifically into what it is that man-
ufacturing must accomplish-oriented, not exclusively to specified draw-
ings, but rather to required functions. Having in mind a precise function,
we can determine the manufacturing processes or skills which will result
in a product that accomplishes the intended function with greatest reli-
ability and lowest cost. Then the manufacturing problem can be broken
down into a series of small, manageable integers, each of which can be
studied intensively as a single item and in its relation to the others. For
example, in a practical case the manufacturing processes were studied,
planned, and put into effect on a water-cooled support and resulted in
a cost of $90. Generalities certainly indicated that nothing more could
be done on the manufacturing of the item. Application of value tech-
niques to the individual parts and to possible combinations of individual
parts showed that two important and costly parts could be combined and
made by hydroforming. This provided a thoroughly reliable product,
even more desirable in that it was somewhat lighter in weight,-and the
cost went down to $36.
In another case, it was reported that manufacturing studies just com-
pleted had succeeded in removing a third of the cost of assembling a
twelve-piece insulating support. Did the generality that the best man-
ufacturing specialists had looked it over and had made their recom-
mendation mean that little more could be done to lower the cost of man-
ufacture? In the "what does it do" functional approach, it was brought
clearly into focus that this item supported 2 pounds of weight, insulated
by about 2 inches from a metal frame. An obvious question was, "Does
it require twelve parts to insulate and support 2 pounds?" This examina-
tion, originating from a study of the manufacturing process, resulted in a
very much simpler and equally effective way of accomplishing the total
function.
3. In this case, the generality was, "It's not practical to make dies for
this quantity." The fact is that:
90 Techniques of Value Analysis and Engineering
Parts may vary in complexity.

They may vary in kind of material used!
Different suppliers develop particular skills in diemaking and machine
setup.
Nearly each year sees advancement in the art of diemaking, and peri-
odically progress is made in the type of machines in which the dies are
fabricated as well as in the simplicity with which dies can be changed.
Different ways of heating metal are developed according to the size
and shape of the raw material.
The important point is, "Precisely what is it that is to be forged?"
Specifically, what equipment, what processes, what specialists in the in-
dustry can contribute to this particular item in the light of today's devel-
opments? Unexpectedly useful benefits result when these time-accepted
generalities are turned into specifics and an action study is made.
4. As for the fourth generality, the same situation pertains as in the
case of generality 3.
5. This generality is one of the substantial reasons wh3 unnecessary
manufacturing costs are retained in a wide variety of moderate- and
lower-volume products. The idea that "the quantities are too low to
liquidate the tools" is very widespread. There are, however, so many
products and parts made in moderate quantity that the problem has
generated its own solution. Specialists have developed processes for mak-
ing special types of tooling, for using combinations of tooling, and for
making quick changes in and out of the equipment, so that all of the
generalities fall by the board. Here again, the question is, "Precisely
what is needed? Who is most likely to have the best answers? Where are
they? How do we get their specific technology applied to this specific
part or function or group of parts?"
For example, a small weld segment, about the size of the palm of the
hand, was made from 3/8 x 3-inch bar stock. One end had to be cut to an
irregular contour. Quantities were 3,000 per year. For several years it
was made by manual effort on power equipment. It cost $1.41. The gen-
erality was, "For material 3/8 inch thick, tools cost entirely too much to
consider buying them to produce a quantity of only 3,000 a year." When
this generality was discarded and vendors of the type who specialize in
"low-quantity stampings" were approached, it was found that, with a
tool cost of $75, they could produce the segments for 39 cents each. The
yield in this case, after it was determined to not accept the generalities
trap, was $3,000 a year for a $75 investment.
6. The last item was, "This is the only practical and reliable way of
doing it." Here again, let us establish what is to be accomplished. What
are the subfunctions which must be accomplished in order to achieve the
overall function? Precisely what are the alternatives for accomplishing
these subfunctions, and what are the relationships between them? With
the total general problem thus divided into its integers, the generality
applying to the whole is no longer applicable. Where this particular gen-
erality has protected the status quo for a period of time, the yield from
the use of value analysis techniques is usually especially large.
To summarize, avoid the generalities trap. Recognize that if a gen-
erality exists it has probably deferred effective value action in the past.
Proceed to break the situation down into specific, man-size integers of
function and cost. Then apply the appropriate value techniques and
watch the results.
Case Study
DEVELOP SPECIFIC INFORMATION
For one application, forty thousand Y4 x %inch screws were required. It

was necessary that they be threaded all the way to the head. Standard
screws contained only a 1 inch length of thread, but they were purchased
and then put in a screw machine for extension of the threads to the head.
The costs became 12 cents. The arrangement satisfied all involved because
(1) purchasing could buy available standard screws with no problems; (2)
manufacturing had the equipment and welcomed the work which could be
put on its machines; and (3) the engineers obtained the screw they needed.
As is so often the case, all considerations except those of value were
properly cared for. The use of value analysis techniques showed that the
function was not worth 12 cents. Accepting no generalities as a basis for
decision, suppliers were asked for bids on supplying screws with the
proper full-length thread initially. This resulted in a change to buying the
screws ready for use for 2%cents each. The purchase and modification of
standard products may be a good-sounding generality that does not
guarantee best value.
A second and most important phase of the rule of dealing with specifics
is to remember that specifics are needed to sell an idea and to stimulate
action. To suggest or ask for a change to a less expensive material in a
product without furnishing specifics is not the value specialist's way. His
procedure must be to describe, with no ambiguity, the specific material,
its characteristics, and how it is proposed to be used. Similarly, it is not
enough to know that a casting, for example, costs $5. The specifics that
count here are: how much of the total represents material, labor, extra
costs for complicated coring, costs of scrap and rejects, costs of patterns
or die maintenance, tolerance, flash removal and machining, inspection
and handling, and the many other factors that contribute to cost.
Many times a sand casting is used because of a general opinion that
sand castings are the cheapest method for producing short-run cast parts.
Later it may prove that necessary machining operations price the part
out of the market. Only by a specific analysis of cost can these details be
pinpointed. Here, it is not enough to ask, "What does this part do?" The
question should be, "What does this tolerance on the part do?" Be
specific, not general.
Case Study
CRYSTAL OR WINDOW GLASS
In each area of activity, habits and accustomed practices prevail. Specific

information, when developed, often leads to changes that bring large im-
provements in value.
In the drafting department of an electric clock factory, the word
"crystal" was always used to designate clock faces, as a matter of habit.
They were called clock crystals. This meant that drawings delineating the
exact shape and dimensions of clock faces always specified these as crystals.
In the general auditing of freight bills, it became accepted practice to
expect the crystals to require a very high freight rate. However, when the
time came for making a special audit of freight rates, the question arose,
"How does a clock facto-iy use so much crystal?" The investigation which
followed disclosed that the clock faces were indeed window glass, warmed
and sagged. The investigation also brought forth the information that the
transportation of crystal, a very expensive grade of glass, is extremely
costly, while window glass, in any form, travels at a very much lower rate.
Crystal shipped "lcss than carload" costs 1.25 times the first-class freight
rate, while "bent window glass," which correctly described the product
being shipped, travels at only 0.85 times the first-class freight rate.
The result was that the name was changed on the drawings, in the
specifications, on the orders, and on the bills of lading
- so that, instead of
being wrongly called crystal, the material was correctly called bent win-
dow glass. The freight rate was cut by 32 per cent. Always, "specifics" are
important.
Value analysis is an intensive study; its very basis is dealing, item by
item, with specifics, not generalities. I t requires reviewing every opera-
tion on a planning card; checking every radius, every corner, and every
hole shown on a drawing; looking critically at operations performed and
a t material purchased but not used and diverted to scrap; and establish-
ing all else that affects cost.
It follows that no effort must b e shunned to get a t and present the es-
sential facts. This may seem like a big job because, while some of t h e
specifics may b e easily obtainable, others may take real effort to nail
down. When this is the case, the value analyst will do well to remind
himself that h e may let an opportunity go by unless h e gets together more
specifics than anyone else may easily lay his hands on.
Whenever the objective is to promote beneficial change, always use
specifics. Generalities serve only to prevent changes and protect the
status quo.
8-2 Get All Available Costs

Meaningful costs bear the same relationship to good value as meaning-
ful tests bear to good performance. Unfortunately, it is not uncommon to
find that far-reaching and important decisions are made without accurate
and meaningful costs. In contrast, important decisions affecting perform-
ance are no longer made without meaningful test data.
To have available and use meaningful costs is more vital and more
difficult than may be immediately apparent. It is vital because cost is
influenced by every decision on every part, component, or subcomponent
of a product. If meaningful cost is a criterion in each decision, then value
may be secured. Otherwise, value is not obtainable.
There are a variety of reasons why it is difficult to obtain meaningful
costs.
Cost figures normally developed are for use in a basic system intended
to ensure proper income tax accounting and proper overall profit ac-
counting for the total business and also to provide some manageable
basis for liquidating necessary charges of all types. It is a popular miscon-
ception that these costs are meaningful for the purpose of decision
making about engineering, manufacturing, or other value alternatives.
They are not. They accomplish their intended purpose very well. How-
ever, when the purpose is important enough and the user understands the
problcms involved, they may serve as a basis for meaningful costs.
The resultant cost figures, however, bear little relationship to those
provided by the normal cost system. As a hornely example, the same types
of materials are put together and the same types of processes are used in
making vehicles of various kinds for the transportation of people. One
vehicle, the automobile, is intended for transport on land and is very
effective for that purpose. Another type of vehicle, or vessel, intended for
transportation on water, accomplishes that purpose very effectively. A
third type, intended for transportation by air, may accomplish its purpose
very well with the same resources of materials, processes, and men's
talents put together for its different intent.
So it is with cost systems. Anyone who believes that costs which have
been put together in a form to accomplish one purpose can also be used
for other purposes and so protect the business' interests arrives at a very
faulty decision.
The cost situation is so involved that different people in the accounting
business use different names to cover different combinations of the
various types of cost. A few of them are:
Material cost Decision cost
Labor cost Shop cost
Overhead cost Standard cost
Fixed overhead Manufacturing cost

Variable overhead Incremental cost
Burden Variance cost
Prime cost
What does each of these terms include? What does each of them mean?
What types of costs are included in the terms used in the company
involved?
Meaningful costs are difficult to develop because of the matter of over-
head. In practice, nearly every machine and nearly every process actually
consumes a different overhead. Still, for convenience of accounting, they
are bunched together in some sort of grouping. How should the fixed
overhead for the buildings, the depreciation, and the management of the
company be apportioned? How should the work of maintenance people,
janitors, service people, etc., be factored into individual costs? What
effect on all of these expenses would different alternatives actually have?
The problem here lies in the fact that it is necessary to provide not only
an answer that is satisfactory to the head of accounting or to the man-
ager, but an answer that is also satisfactory to the economic system. An
incorrect method of preparing so-called meaningful costs may be directly
responsible for making wrong decisions which preclude good value in the
product.
Another reason for the difficulty of getting meaningful costs is that
habits, practices, and procedures are already established in most areas.
People and machines are in place and things are being done in a certain
way. Vested interests exist. Change often seems wrong to the people in-
volved. Change always brings uncertainty and a measure of insecurity to
the people concerned. Because means of allocating costs have been em-
pirical and arbitrary, the tendency is to prolong the use of existing types
of costs.
Does "labor cost" mean the amount paid to labor? Possibly, but prob-
ably not. It may include only part of the payment to labor; the remainder
may be in a variance or other account caused by labor rate increases since
the item was planned and the various costs set up.
Does the "material cost" show the amount which was paid to vendors
for material? Perhaps so and perhaps not. Frequently, the accounting
practice is to add certain overheads into this account. Someone must
purchase, receive, inspect, and protect material. Additions of from 3 to 20
per cent to the actual material cost for these operations are not uncom-
mon. Thus, the material cost may actually include some overhead.
Where labor and material costs include just the total of labor and
material, are the figures meaningful? The assumption in this case is that
the machines, the buildings, and the supervision are all in place and noth-
ing needs to be added to the bare cost of the labor and material involved.
The answer is obvious: These are indeed not meaningful costs. Obviously,
the business results will be affected negatively by taking advantage of

time, people, and facilities paid for in other budgets. Decisions made on
this basis will not bring value to the product.
If we add overhead to labor and material, that is, if each part or prod-
uct is assessed its share of the overall overhead so that the item takes in
the total of material, labor, and overhead, does the cost become mean-
ingful? Certainly not in itself. Many items of overhead in the business
continue, and will continue, regardless of whether the particular part or
assembly is made on one machine or another machine, is made in one
assembly area by one method or in another assembly area by a different
method, or indeed is purchased from an outside supplier. Many more
overhead items are affected in varying degrees, some rather directly and
others most indirectly.
The purpose here is not to penetrate deeply into accounting practice-
a subject on which text books are available-but rather to provoke rec-
ognition that the mere inclusion of overhead does not bring meaningful
costs for value decisions.
What happens if we concern ourselves with labor and material plus
partial overheads? It has been reasoned that overhead is divided into
two groups: fixed and variable overhead. Fixed overhead takes in such
items as costs of buildings and equipment; depreciation; and general
management of the company, research, and other operations that will go
on regardless of the value decision pertaining to any one product. Vari-
able overhead covers the expense occasioned by the particular way in
which the particular product is designed and manufactured, such as
carrying charges of special machines and equipment used, foremen and
supervisory personnel, and other items, exclusive of labor, which are
caused directly by the particular manufacturing or design alternative
chosen. Do we now have a meaningful cost? Perhaps the problem lies
in the danger of using arbitrary or habitual percentages which may not
in the slightest way show how the business is affected. For each engi-
neering and manufacturing alternative, these various overheads are prob-
ably affected somewhat differently. Therefore, it becomes necessary to
understandingly study the specific alternatives involved so that the
amounts of overhead expense and other additions will be in harmony
with the economic system and not necessarily with the practices of the
past in the area involved. Any margin of error between what is believed
to be meaningful cost and what is in reality the true economics of the
way the business is affected is decreased value.
What then is meaningful? To prepare meaningful costs for the purpose
of making correct value decisions, the true effect of the use of the differ-
ent alternatives must be interpreted in terms of dollars for several areas.
How is the business really affected?
How is the product affected?
How will sales be affected?

How will other products be affected?
How will the company's future pans be affected?
How will the development of new technology be affected?
Attainment of the desired degree of reliable performance is commonly
no problem except in the case of newer products that are the result of
recent research and development, and these might embrace 10 per cent of
the industrial production. Where the problem does lie is in getting
reliable performance at low-enough cost. Cost is the important factor in
decision making in every phase of product planning, designing, and
manufacturing. For nearly every function and for nearly every manufac-
turing situation, there exist many alternative solutions, all of which will
accomplish the purpose reliably. Proper selection depends upon mean-
ingful costs, and only when such costs serve as an essential criterion in
the decision making will good value be achieved.
Without meaningful cost, decisions will not, and cannot, be made
to provide good value.
E X A M P L E 1 : There are no costs. This is a normal situation when
value analysis work is done before design. It forms a satisfactory
starting point. Meaningful costs must be developed, however, for
each of the alternatives that might be used.
E X A M P L E 2 : Costs exist but are not provided. Seldom, if ever, is
value work efficiently done if costs which exist are not brought forth.
Getting good value is difficult. All possible help is needed. Knowing
present cost sets certain floors and ceilings with relation to different
types of alternatives. This saves time and helps show where the work
will probably be most effective.
In contrast to performance-oriented work, it is often desirable, in
order to secure good creativity, to avoid knowing how others have
accomplished the desired function until some study has been made.
Otherwise the thinking is often channeled into the types of solution
that are known to have been used previously, with the consequence
that excellent value alternatives which might accomplish the total
function reliably for a small fraction of the cost are not brought into
view.
To summarize, start out with the best costs that exist, understand
them, know their deficiencies, and gain all possible benefits from
them.
EXAMPLE 3: Data exist but only labor and material costs are pro-
vided. This situation is sometimes found in areas in which competi-
tion has not forced a high degree of value. Normally labor costs are
known, as are material costs. Furthermore, it is known precisely how

much of each applies to the product in question. The easy, habitual
way is to accept these as the costs. No interpretation, no imagination,
no direction, no forethought, and very little effort are required. In
contrast, if some or all of the pertinent overhead figures are included,
the questions arise: Which one? How much? What percentages? etc.
These require thought, study, and understanding. Where only labor
and material costs are provided, the action taken is usually justified
by various forms of rationalization; for example, "Direct costs of
labor and material are about all that are affected by a change any-
way; overheads continue relatively the same."
Again, efficiency of value work is reduced to the extent that perti-
nent costs are not brought into the picture.
EXAMPLE 4: Decision cost-so called "out-of-pocket cost"-in
make-or-buy decisions.
A general statement, specific enough to have some validity, is that
meaningful costs for use in make-or-buy decisions will include:
Labor
Material
Variable overhead
Some amount of fixed overhead
Normally, all labor, material, and variable overheads are included.
But, considering all of the effects on the business, on costs, on sales,
on other products, etc., the question is: What percentage of fixed
cost should be added to arrive nearly at an out-of-pocket cost which
will show how the business will be affected?
Although there are many important factors, the most significant
consideration normally used is the amount of work in the plant com-
pared with its capacity. When machines or facilities are only partially
loaded, it will be observed that some machines are idle, floor space is
not filled, some people are on short time, and other people are obvi-
ously "stretching" less important work in order to make a full day of
it. It is generally felt that the costs for make-or-buy decisions are
lower in this situation than when the plant is working at full capacity
or over. Figure 8-1 illustrates an approach that is sometimes used.
I t will be seen that the amount of fixed overhead liquidated in the
cost of the particular product is reduced as the plant load decreases
to bring more work into the plant. Again, as the plant work load
increases, the amount of fixed overhead applied in the comparison
figures is increased, tending to minimize "keep-busy w o r k and to
open up capacity for essential, productive, profitable products which
must be manufactured in the area.
98
ilrn
Z
0
v,
y p 150%
5 125%
8 iooa
Y 5 75%
, =,
L Z
0 50%
" 25%
gg
aa
I ,
Techniques of Value Analysis and Engineering
25 50 75 100 125 150

%OF FACTORY LOADING OR
EXAMPLES
MATERIAL
LABOR
VARIABLE OH 75%
FIXED OH 125%
FACTORY LOADING
%FIXED OH TO USE
AMOUNT FIXED OH TO USE
M OR B DECISION COST
VENDOR'STOTAL PRICE
MAKE OR BUY
UTILIZATION AT THE SPECIFIC TIME

Fig. 8-1 "Make it or buy it."
$
50%
1
2.00
1.00
1.50
2.50
50%
1.25
5.75
6.50
MAKE
2
$2.00
1.oo
1.50
2.50
75%
75%
1.87
6.37
6.50
MAKE
EXAMPLE 5 : Decision cost involving make one way versus make

3
$2.00
1.oo
t.50
2.50
100%
100%
2.50
7.00
6.50
BUY
4
125% 150%
125% 150%
5
$ 2.00 $ 2.00
1.oo 1.00
1.50 1.50
2.50 2.50
3.12 3.75
7.62 8.25
6.50 6.50
BUY BUY
another way in the factory.

The general practice is to use labor plus material plus variable
overhead plus or minus significant changes in the way fixed overhead
is affected.
I n conclusion, the costs used often make the decision. Therefore,
any wrong action taken in preparing cost means a wrong decision
and resultant poor value in the product.
Case Study
UNMEANINGFUL COSTS USED FOR DECISION
MAKING CAN BANKRUPT THE BUSINESS
Word was received that severe customer resistance had developed to

hamper the selling of an important electromechanical control. Advices
were that all the assemblies, subassemblies, and parts were laid out for
study and that each was labeled with costs, quantities, etc.
Even first examination showed that costs were extremely high. For ex-
ample:
Twenty-cent items often cost 50 to 70 cents.
Two-dollar items often cost $4 or $5.
Three-cent items cost 50 cents.
Eight-dollar subassemblies cost $21.
Study was undertaken to determine why costs were so high. Some of the
reasons follow:
1. Parts were being made on less than optimum equipment.
2. Parts were often made by skilled labor when they required none.
3. Inventories of some parts were extremely high.
4. A "blanket" fixed-overhead rate was used on all items whether the
fixed assets used consisted of a screw driver or a $20,000 machine.
INTERPRETATION: Cost figures which were used for decision making and
which had been responsible for overpricing the product were not mean-
ingful because:
1. The use of blanket fixed overhead regardless of the fixed assets used
prevented decision makers from knowing how the business was really
affected by the various alternative methods for accomplishing the neces-
sary functions.
2. The job was used as a "filler" to take up the slack in the factory.
Whenever machine time opened up or men had no other jobs, parts were
made for inventory. Labor costs were not meaningful for decision making
between alternatives because they were often based on uneconomical
short runs and on the use of much higher skill than the particular items
required. Setup costs were not meaningful for decision making because
they were based, not on needs of the job, but rather on conditions of
"factory slack absorption." In fact, no costs-labor, material, or setup-were
meaningful for decision making because they were based, not on the needs
of the design or the job, but on other considerations.
3. The volume of the work in the factory was being reduced because,
unfortunately, the selling prices of the product were being influenced by
the summation of these costs.
Even a glimpse at the cost realities shows that included in these "care-
fully delineated" costs of parts, subassemblies, and assemblies were these
costs:
1. The legitimate cost of producing the functional parts, subassemblies,
and assemblies as they were designed
2. Completely extraneous costs for factory load balancing
3. Costs for totally unused items of fixed assets
It was decided that two activities would at once proceed.
1. Determination of appropriate costs, strictly applicable to the par-
ticular parts and assemblies being manufactured
2. Using the value analysis techniques, evaluation of all functions of the
product
With the meaningful figures of cost for accomplishing the various func-
tions by means of present designs and with a clear view of the value of
these functions, alternatives were developed where poor value existed.
The result was practical alternatives as a basis for decision making which
would reduce the total cost to less than half.
8-3 Use Information from Only

the Best Source
Lack of full information and use of misinformation are frequently the
cause of a poor degree of value. In recognition of this, the search for
pertinent information in value analysis must b e a continuing one, and
likewise, the sources from which the information comes must constantly
be weighed to ensure that they constitute the best ones available. The
more diligent and effective the search for the best information, the better
the value attained.
Questions by the score must be raised, and answers must be accepted
only from the highest level of the best sources in each case. Some ex-
amples of the sort of questions that should be asked are:
Why is this square?
Why is it painted red?
Why does it have a double set of contacts?
Why is it "hogged from solid bronze?
Why is there a 0.0001-inch tolerance on the diameter?
How does the customer mount the base?
At what atmospheric conditions must it work?
In what positions can it be mounted by the customer?
What limits its market?
What causes it to be noisy?
What benefits does the F4 finish on the inside of the cover bring?
Answers traditional to the thinking within any area are readily avail-
able. Experience shows that such pat, traditional answers must not be ac-
cepted. Whatcver the pertinent question is, only the best source must be
allowed to answer it. The following examples are offered in verification
of this statement.
Who is the best source, the engineer or the sales manager? In the value
analysis of a moderate-sized piece of electrical equipment, a partial in-
side cover was found which had a cost of $5. The analyst, in analyzing
functions, could find no function for it. Accordingly, in reporting to the
engineer in charge, he said, "This cover costs $5 and I can find no func-
tion for it." The engineer immediately answered, "It has no function, but
the customers require it." The analyst at once recognized this as quite
a normal situation, in which the engineer voiced his belief; in fact, he
voiced the criterion on which the decision to retain this cover had been
made for years. The analyst's suggestion, therefore, was, "Why don't we
ask the sales manager why it is that the customers require this cover if
it seems to us to have no function." When the question was subsequently
put to the sales manager, his answer was: "Does that cost $5? Take it off.
I have only one customer who uses it. The others take it off and throw
it away. I will see to it that this particular customer pays a special charge
for extra equipment."
Again, who is the best source, the sales manager or the purchasing
agent? At a manager's staff meeting, it was being determined whether or
not it was practical to increase production of some appliances from 2,000
to 4,000 per week. The marketing manager said, "In this market we can
now sell all we can make. However, with the shortage of steel, we can't
get enough to support a schedule of any more than 2,000 a week." This
statement contained what he believed, for the very good reason that he
had made inquiries. He had talked from time to time with purchasing
and had read in trade magazines about shortages of steel. Just before
the group made its decision, the engineering manager said, "Shouldn't
we call in our purchasing agent and get a direct up-to-the-minute read-
ing from him on this shortage of steel?" That was done and the purchas-
ing agent, like most competent men, knew more about "his business" than
anyone else. When told that they wanted to increase the schedule to
4,000, he told them to increase it; he would furnish the steel. Thus, a
loss of potential business was narrowly averted by merely going to, and
accepting the answer from, the best source. What the purchasing agent
did was to buy some of the necessary steel components in a partly fin-
ished or finished form, and by so doing, he properly utilized the steel
allotments of various component manufacturers for whom he provided
good business at the same time that he met his own quota of 4,000.
Who won't approve it, the Underwriters'? A value alternative sug-
gested for a small transformer would reduce its cost 20 per cent and
seemingly provide all the functions, as well as efficiency and reliability.
The answer from the engineer was, "The Underwriters' won't approve
the change." For the answer to the resultant question, "Why won't Under-
writers' approve?" communication was made directly with the Under-
writers'. The answer from the appropriate personnel in the Underwriters'
office was: "Proceed with the change. Several years ago, under different
conditions of application, we felt that the transformer should be made in
a certain way. However, we have since changed this requirement as the
added expense makes no contribution to safety or performance."
Case Study
THERE I S ONLY ONE SUPPLIER
A special instrument required a glass cover, about 10 inches in diameter,

having a curved shape similar to a cereal bowl and having a %-inch hole
through it. Its cost was $1.25, and the quantity used was about 20,000 per
year. The value analyst was told, "There is only one supplier for this type
of part, and though we recognize that the cost seems high, we have little
choice."
Realizing that the buyer in a specialty department was not the best
source for knowledge relating to clock and instrument faces, the analyst
asked the buyer at a clock factory if he could suggest suppliers for the
part. The answer came back, "We have six excellent suppliers for this type
of part." Drawings and specifications were sent to some of these suppliers,

and the result was that, for exactly the same item, the cost became 50
cents rather than $1.25.
It always pays t o locate and consult the best source.
8-4 Blast, Create, Refine

This is a special technique usually helpful in reaching value objectives.
Its purposes are many. First, it serves to eliminate what is in immediate
view so that the mind is no longer channeled and so that thinking in
totally different, more effective directions is not stifled. Second, it directs
thinking to basic considerations. Third, it provides a mechanism for build-
ing that which is needed on these basic considerations.
The use of the technique is often very painful to the originator of a de-
sign or a plan. His solutions are his brain children, so to speak. In arriving
at them, a great deal of effort was expended. Studies were made, money
was spent, the aid of others was solicited, and so on. With the concept
evolved and the plan put together, the designed and manufactured
product has truly become a part of the individual. To him, the idea of
"blasting" is inwardly revolting. I t is as though a part of his being were
about to be destroyed.
These mental reactions are emphasized here because the whole tech-
nique of blasting, creating, and then refining is a mental, not a physical,
one. I t can be extremely productive when people are mentally trained
to understand and use it.
In the technique, the function or functions are first brought into very
clear focus. Then the possible means of providing the functions are re-
duced to oversimple terms. The necessary complexity is then added.
Alternative means for adding the complexity come next. Where good-
grade value is required, this procedure is necessaly to eliminate the
causes of why things are done as they are. The common controlling
factors are the habits and knowledge of the people at the time the par-
ticular thing, whatever it be, was first done and when it later was modi-
fied as different processes and materials and other people came into
the picture.
For example, the three-room house so typical in the Middle West in
earlier days provided accommodations for living, cooking, and sleeping.
Sanitary facilities were outside in a nearby building. This house was func-
tional and appropriate to the circumstances of the time as they were then
known and interpreted by the people involved. Later, a lean-to was
added to include two sleeping rooms as both girl and boy children came
along. There followed a lean-to for the hired man. When the family
became overcrowded, another lean-to for the kitchen was added and
the former kitchen was converted into eating space. With the advent of
modern plumbing, a further lean-to was provided for a bathroom and
the outside facilities were likely to be remodeled into a tool shed.
Intense study of any product shows that it is, to a greater or lesser
degree, the result of such a chain of happenings. Even the new products
that value work will bring forth will be, to some extent, of a similar
nature.
This situation raises the following vital questions in the search for
better value:
How can this chain of influence be periodically stopped?
How can a function needed today, in the light of today's knowledge,
be looked at objectively?
The technique of blasting, creating, and then refining is specifically
directed toward accomplishing these objectives. The aims of the three
steps in the use of the technique are:
1. Blast. In this stage (keeping in mind the basic functions to be ac-
complished, but not expecting necessarily to entirely accomplish them)
alternative products, materials, processes, or ideas are generated. These
alternatives should, first of all, qualify for accomplishing some important
part of the function in a very economical manner or, at least, serve as an
economical base for modifications that are likely to accomplish an im-
portant part of the function. At the same time, the precise amount of the
function which would be accomplished and the specific cost which
would result are brought into clear focus.
2. Create. Using intense creativity, as described in section 8-5, this step
should serve to generate alternative means by which the concepts re-
vealed by the blasting can be modified to accomplish a large part of the
function with pertinent increases in cost. In this creative part of the
technique, definite integers of increased function are associated with
definite integers of increased cost.
3. Refine. In this final step, the necessary created alternatives are
added to the functions which would be accomplished by the blasted
product. These are further sifted and refined, adding additional integers
of function with additional integers of cost, until the refined product
fully accomplishes the total function. It is not uncommon for the result-
ant newly constructed product concept to accomplish the total functions
with the same reliability and overall benefits for a cost of one-half to
one-tenth of the original.
The following are examples of execution of the three steps. The selec-
tion of the three most common simple fasteners-the nail, the screw, and
the bolt-is made purposely for the sake of clearness.
Nail
To blast a steel nail, let us compare its cost with that of steel wire of
the nail diameter, which surely is capable of performing an important
part of the function of a nail.
In our blasting of the nail, it is recognized that additional work must
be done on the steel wire to make it accomplish the total function of the
nail. Our next step must be to create, for review, a list of alternatives
which will serve for the function of the head, such as (1) bend the wire
at one end, ( 2 ) flatten it at one end, and ( 3 ) weld a small piece at
one end.
In refining, we first look again critically at the total function of the
nail. Second, we review the basic cost of the material from which the
nail is made, as found in the blasting, and also the amount of function
which the wire alternative fails to accomplish. Third, we develop the
ideas arrived at in the creative approach to a point where the ones most
practical can be selected for further consideration, and we then select
one or tu7o of the approaches which will provide, at a minimum cost,
most of the required additional function. Fourth, we critically review the
new approach, which embodies the blasted concept plus the created ad-
ditions, and determine whether the function is totally accomplished with
complete reliability. Also, we ask: Have the lowest-cost practical solu-
tions been selected? If the function is not totally accomplished with com-
plete reliability by the selected combination, we must refine further by
adding additional increments of function and cost so that the new
product becomes totally usable.
Screw
To blast a steel screw, it seems reasonable to compare it first with steel

wire of proper diameter and then with the nail. In each case, we iden-
tify appropriate costs.
Starting with the alternative of a nail, we proceed to consider (1)
cutting the thread, ( 2 ) rolling the thread, ( 3 ) coining the thread, ( 4 ) ac-
complishing the function of the screw without a thread, (5) coining a
slot at the head end, and ( 6 ) milling a slot.
Again, we combine the best alternatives produced by the blasting and
the creating, adding in each case the integers of function and the in-
tegers of cost. Then we study the precise function for which the screw
is to be used and make necessary refinements by adding additional func-
tion and additional cost until the product will accomplish the total func-
tion completely and reliably.
Bolt
To blast a steel bolt, we may similarly compare it with steel wire or rod
of the appropriate diameter and in the appropriate amount, then with a
steel spike or nail, and finally with a steel screw. In addition, we study
the function which is intended for the bolt and, if possible, draw com-
parisons with other basic ways of accomplishing the same fastening
function at a much lower cost.
From among the blast alternatives, we may start here with the wire or
rod necessary and proceed to ( 1 ) create alternatives at the end as was
done in the case of the screw, ( 2 ) create alternatives at the head end,
and ( 3 ) examine the function to determine what variation of alternatives
can be provided for the particular application. In each case, we should
attempt to bring into view, at least for preliminary consideration, a con-
siderable number of alternatives.
For the refining, we follow the procedures described above in connec-
tion with the screw. The more complicated the product, the better are
the opportunities for wide use of creativity and for searching investiga-
tion of value alternatives which will accomplish total functions reliably
for very much lower cost.
The blast approach may often be used also on individual elements of
the cost. For example, let us take the case of a counterweight that cost
6 cents.
Its function was to provide weight. It was used in a completely en-
closed assembly with no parts other than its support near it. Simple anal-
ysis showed that its use value was 100 per cent and its esteem value 0
per cent. The amount of $2,000 per year was paid to grind a small flash
from the casting. This flash did not affect the weight or the mounting or
the environment.
The "function" secured for the expenditure of $2,000 was blasted and
revealed that the grinding provided no use function. With no esteem
function, any expenditure which does not provide a use function repre-
sents total waste. Accordingly, the grinding operation was blasted to zero
and eliminated from the cost.
Looking back, it is seen that it was quite normal to accept the $2,000
cost because it is normal to grind the flash from castings. It is the way
such things are done. It represents the way people who are used to
handling castings operate. It is accepted by them, on the basis of their
years of experience, as a normal, proper, and necessary operation to add
to casting making.
The reader will learn to recognize that the accomplishment of out-
standing results will depend, in some instances, upon expertness in the
use of the "blast" portion of this technique; in others, expertness in use

of the "create" portion will be largely responsible for extremely high-
grade results; in still others, extreme expertness in the "refine" portion
will bring forth the optimum results. It is important that the value of
effectively using each portion, when and as it is needed, be understood
and, further, that the emphasis in each case be placed where it is needed.
The examples that follow will aid in recognizing the validity of this
statement.
EXAMPLE 1: A needed part (Figure 8-2) was a piece of %-inch
copper tubing 1% inches long. Its cost was 4 cents. Here are the
results of applying the three steps of the technique.
Blast. The basic cost of the required amount of copper tubing at
the mill was found to be 3/4 cent.
Create. The first alternative was to draw the tubing straight at the
mill, box it in 20 foot lengths, and ship it to the factory for cutoff.
The second alternative was to draw the tubing but wind it in coils
and ship to the factory for straightening and cutoff. The third alter-
native was to arrange to have the tubing cut off at the mill as it was
drawn and so eliminate the need for boxing straightened lengths for
a costly shipment or for coiling the tubing and having it straightened
at the factory.
Refine. Putting together the costs, the figures for alternative 3
were:
Material $0.0075
Cutoff 0.0010
Boxing and freight 0.0017
Total (delivered ready for use) $0.0102
Quite obviously, the third alternative appeared to be the proper
one to subject to refinement. What refinement was necessary? In the
particular application, it was essential that there be no burrs. There-
fore, the cutoff equipment had to be inspected and samples of its
work had to be examined for burrs. This examination proved that the
high-speed cutoff equipment accomplished its work effectively with-
out leaving burrs. The final result was that the cost for the part
changed from 4 cents to 1.02 cents.
Fig. 8-2 Copper tubing.

Fig. 8-3 Clamp bar. Fig. 8-4 Clamp bar:

same function, one-fourth
the cost.
EXAMPLE 2: The clamp bar shown in Figure 8-3 is made of steel,

1 x % inch, with two %-inch threaded holes. It is 2 inches long. Re-
quired quantity is 4,000 per year.
What is the function? Half concealed inside heavy equipment, this
clamp bar performs a basic function which could be provided by two
%-inch nuts. It does, however, also provide the secondary conveni-
ence function of compensating for the fact that there is no space in
which to insert a wrench to hold individual nuts during the tighten-
ing operation. Further, the clamp bar is desirable to keep individual
nuts from becoming loosened during the use of the equipment. The
overall function, then, consists of a holding function, approximately
equivalent to that which would be performed by two nuts, plus some
type of secondary fastening function, such as could be provided by
welding the two nuts together, welding them to a common piece of
metal, or pressing them into some sort of holder which would keep
them together.
Blast. The basic function for which this part was designed, we find,
could be accomplished by two nuts which cost 1% cents each.
Hence, the value of the basic function is 3 cents. This represents a
typical blast finding. We have an alternative which will provide an
important segment of the function, though it will not accomplish the
overall function. To do that the two nuts must somehow be fastened
together.
Create. How to fasten the nuts together is the subject of the
second step, and we arrive at these solutions:
1. Weld the two nuts side by side.
2. Weld the two nuts to a piece of wire.
3. Weld the two nuts to a piece of sheet metal.
4. Press the two nuts into two holes in a piece of sheet metal.
Approximate costs for the above alternatives are brought into view.
Refine. Particular complications or problems to be solved in each

case are now generally considered. While so investigating, we find
that a vendor makes and sells weld nuts of the proper size. Further,
we find that the factory has proper facilities for making a small
stamping and for welding the two nuts into the stamping. The result
of the blasting, creating, and refining is the double nut assembly
shown in Figure 8-4. Its cost is 8 cents, while the cost of the clamp
bar had been 32 cents. In other words, by applying the technique, an
alternative is provided which reliably accomplishes the overall
function for one-fourth of the cost.
EXAMPLE 3: Here we are concerned with a small radio-frequency
transformer (Figure 8-5) about twice the size of a grain of wheat
and costing 39 cents. It is used in large quantities. What is the func-
tion? The normal function of a transformer is to effect a useful trans-
fer of electrical energy between two coils. For that purpose, one coil
of wire is brought in close physical proximity with another coil of
wire. In this type of product, it is most profitable to divert the
thinking from the end function to the structural function. Basically,
the problem then becomes one of reliably holding two coils of wire
in an appropriate physical relationship. In this case, "holding" was
found to be accomplished by winding both coils of wire on a very
small spool. Four almost microscopic holes were then drilled in the
ends of the spool, and the four necessary ends of the two coils were
threaded through and pulled out of these holes. Study showed that
the two coils of wire accounted for less than 10 cents of the cost.
The cost of the spool, the drilling of the ends, and the threading of
the wires through the holes in the end made up the bigger part of
the cost.
Blast. Use only the two coils of wire. Put the two coils on a tooth-
pick-size piece of wood or plastic.
Fig. 8-5 A small Fig. 8-6 A radio-fre-

radio-frequency quency transformer, iden-
transformer. tical in function, one-half
the cost.
Create
1. Discontinue drilling the spool ends and the subsequent thread-
ing of the fine wires through the holes.
2. Use a drop of adhesive to hold the wires in place.
3. If the spool ends are not to hold the wire, they will not be
needed, and so we can discontinue using the spool.
4. Use a straight piece of suitable plastic or insulator material,
wind on the coils, and secure the wires by a drop of appropriate
adhesive.
Refine. By using only the coils as indicated from the "blast" step
and the small insulator and adhesive (alternative 4) to maintain
them in rigid relationship to each other, the electronic function can
be accomplished at considerably less than half the original cost.
However, we are now short of a means of supporting the assembly
in the equipment. To provide for this, an additional small mounting
part can also be secured by the drop of adhesive, as shown in Figure
8-6. The new cost is 19 cents. The annual cost, which had been
$78,000, is now $38,000.
Fig. 8-7 Radar-control mounting.
EXAMPLE 4: In military equipment of the radar type, it is often

necessary to have a control for centering a spot on the televisionlike
screen. This "joy-stick" assembly (Figure 8-7) consisted of a mount-
ing plate about 6 inches square with a small lever about 4 inches
long extending through the center. This lever could be moved in any
direction, and as it was moved, it electronically caused the spot on
the screen to move in the same direction. In back of this plate were
suitable gears and mounting for the lever and for four potenti-
ometers: two operating at right angles to the other two. The total
assembly cost $127. The potentiometers which accomplished the

electronic function accounted for $3.60 of this cost. For the required
simple, unprecise manual movement of $4 worth of electronic gear,
$123 worth of mechanical gear was used.
The overall function was that of electronically providing decreases
in certain currents and increases in others so that the spot could be
guided to the center of the screen. For the purpose of providing
better value alternatives, this total overall function is best divided
into a number of subfunctions which become quite manageable
valuewise. Basically, the mechanical functions of the device consist
in mounting four small potentiometers with an operating handle so
that the handle can be moved through the proper range to adjust the
potentiometers for proper operation.
Blast. For this item, with which the hand moves a small lever
until the eye sees that the spot is in the center, it would seem that
a very simple mechanism for mounting the lever and the potenti-
ometers would accomplish the total purpose and would be low in
cost.
Create
1. A standard or a modified ball-and-socket mounting with suitable
linkages to operate the potentiometers.
2. A simple "double axis" mounting with the axes at right angles
3. Standard control levers with their mountings, as already pro-
vided and available for other applications
Refine. A study showed that the principal reason for the high cost
was that the potentiometers had to be moved through 300 degrees to
get their complete variation, and to that end, it was necessary to
have a considerable number of gears back of the panel in order to
magnify the 90-degree motion of the lever through the panel. It was
further found that a plus or minus 20 per cent variation tolerance
was properly specified for the potentiometers, because in this appli-
cation, any specific benefits from close tolerance would be canceled
out by differences in the motion of the hand.
The vendor was asked for quotations based on providing potenti-
ometers which would vary through the same range with a motion of
90 degrees. This he was able to do, but the potentiometers became
"specials7' and a cost increase of 10 cents was added to each. There-
fore, instead of $3.60 for the four standards, $4 would have to be
paid for the four specials. A basic model was promptly provided for
$11 to meet other physical conditions of the equipment. This was
further refined to an interchangeable component which met all of
the operating specifications and which had the same reliability at a
Results Accelerators 11 1
cost of $30. Three-fourths of the cost was removed and all of the per-
formance reliability continued. This is a typical result of applying the
technique.
To summarize, the very useful value analysis technique of blasting,
creating, and then refining serves first to bring the needed functions
sharply into focus. Then the means being used or planned to accomplish
these functions are critically reviewed and blasted by comparing them
with processes, products, or materials which would accomplish only part
of the function but which would have a small fraction of the cost. This
is followed by an extensive and intensive creative effort in which a series
of significant alternatives for accomplishing the total function or each
part of the function or for causing other methods to perform satisfactorily
are brought into view. In a subsequent refining effort, the total needs for
the application are objectively considered in the light of all the informa-
tion developed in the function study and in the blast and create phases,
and a suitable combination of alternatives is established for reliably
accomplishing the total function at a cost lower than that existing.
Case Study
THE ELECTRIC CONTROLLER
Electromechanical controllers, approximately 1 x 1 x 2 feet in size, were

required in quantities of 1,000 per year. The product performed its func-
tion well and had received good acceptance in the market for several
years. With the constant march of progress, it was apparent that the sell-
ing price would have to be lowered, which in turn meant that costs would
have to be lowered. A team of men from the engineering, manufacturing,
purchasing, and cost department was assigned to go over the controller in
detail. Their work culminated in the reduction of costs by about 10 per
cent. While this reduction was adequate to meet the market conditions at
the time, it certainly allowed no leeway for the unexpected. Hence the
manager, who had heard of the value analysis approach, arranged to have
a man make a value audit of the product using value analysis techniques.
Starting again with the functions performed by the assemblies, the sub-
assemblies, and the parts and evaluating these functions, value alternatives
were developed which would reliably accomplish these functions.
Some of the items, together with the particular changes affecting them,
were as follows:
Small hinges were made by buying an extruded section, drilling the hole
for the pin, and then drilling mounting holes in the flat portion. The cost
was 28 cents. By using a Ys x 1-inch steel strip, cutting it to length, rolling
it at one end for the hinge pin, and drilling it for mounting, the cost be-
came 10 cents.
A steel hub 2%inches in diameter and 3/4 inch thick, with a %-inch hole
drilled in the center and six small holes drilled around and near the outer
circumference to serve for mounting two small 6-inch diameter by %-inch-
thick aluminum dials, cost $1.27. The search for a specialty product which
would perform this function revealed that aluminum companies sell slugs,
i.e., round pieces of aluminum punched from sheet stock, for use in impact
extrusion machines making toothpaste tubes and a wide variety of similar
containers. It was found that one of these slugs, 2% inches by 34 inch in
size, could be secured for 4 cents. However, it was slightly cupped, and
the judgment was that for the application in question it needed to be flat.
This could be accomplished by a flattening operation costing 1 cent. The
operation of drilling the center hole and the smaller holes for mounting the
dials came to 8 cents, giving a total of 13 cents instead of $1.27.
Plastic cams, ?4 inch thick by 2 inches in diameter, having the equiva-
lent of saw teeth, approximately eight per inch, cost $1 each. By review-
ing the product with the plastic supplier, it was determined that orders
placed approximately twice each year rather than more frequently in very
much smaller lot sizes, as had sometimes been done, resulted in a price of
20 cents.
A %-inch ID by %-inch OD by %-inch-long collar drilled and tapped
for a radial set screw cost 36 cents. It was made on a screw machine. Bv
changing the raw material to a heavy-wall tubing which was cut, burred,
and provided with a drilled and tapped radial hole, the cost came to 10
cents.
A special jam nut cost 20 cents. A standard jam nut of the same general
description cost 1 cent. However, the distance across comers of the stand-
ard jam nut was slightly too large-?& inch-to avoid interference with the
smallest-size gear which, under some conditions, was used in the mecha-
nism. A slight modification was made in the mounting arrangement, and
the cost became 1cent.
A small spur pinion, approximately 5/s inch in diameter by % inch long,
was being machined. Its cost was 65 cents. A supplier was found who
could provide the pinion stock of the proper size and thread so that the
factory merely needed to cut it off and burr it in order to produce an
interchangeable pinion for 40 cents.
Three switches and a switch mounting plate were purchased from the
same supplier for 85 cents. They were routed to the factory and put
together into an assembly. The cost of the assembly was $1.33. The par-
ticular supplier was asked to provide the assembly ready for use, shipping
only one part instead of four. This eliminated much inspection, mounting,
handling, storing, etc. The supplier offered delivery of the assemblies ready
to use at $1.
A bracket in the form of a U was made of % x 1-inch steel bar. The
base of the bracket was about 6 inches long, with each end turned up ap-
proximately 2 inches. Some suitable holes were drilled. The cost of the
bracket was 48 cents. In studying the reason for the high cost of this
bracket, it was found that one operation-a special straightening and sizing
of the ends to hold the distance between the two bent-up ends within ex-
tremely close tolerances-accounted for 12 cents of the cost. This sizing
operation was said to be required so that the assembly would immediately

go together under all circumstances. Inspection and study of the assembly
area showed that a mallet was kept nearby. The operator said that it was
used on all of the brackets in assemblv. This element of obviouslv un-
necessary and noncontributing cost was eliminated, and some other im-
provements were also made, with the result that the cost became 17 cents.
A bearing block was made by buying extruded material, cutting it into
lengths approximately M inch long, and drilling a large mounting hole for
the bearing and two transverse holes for mounting the block. It cost 65
cents. It was found that a piece of %-inch steel sheet, with two holes
drilled in what would serve as a flat section for mounting and a large hole
swaged to receive a flanged bearing in a section that was bent up at right
angles, would accomplish the function with the same reliability for 20
cents. It was further found that the bearing which was being used cost 11
cents, whereas a suitable flanged bearing would fit ideally into the as-
sembly and cost 3% cents.
The device contained a dust cover which was open at the bottom and
hinged on the side and cost $5. As reported elsewhere in this text, the
cover appeared to have no function, but the engineers believed that it was
necessary to provide it on the product in order to please the customers. It
was found that only one customer wanted it, so the item was eliminated
except for that one customer, who then paid for it as special equipment.
A large assembly called a motor plate pointer assembly was made of
%-inch steel approximately 5 inches on each triangular side, with a welded
pointer rising several inches and with teeth cut on one edge. Its cost was
$1.80. In the value study, its function was evaluated at considerably less.
A review of the cost build-up showed that these steel parts were being
copper plated, chemically blackened, and then lacquered. Newer processes
for chemically blackening steel directly, to provide good surface protection
and a good appearance finish, were investigated and resulted in a decrease
in cost to 80 cents.
A panel costing $2.28 was also carefully investigated. Each point of
specification which caused increased cost was studied, and such actions
were taken as were desirable and possible. Among others, care was taken
to control the ordering quantities to eliminate unnecessary setups. The
cost decreased from $2.28 to $1.
All these and other changes, none of which in the least affected the
needed function, were responsible for a 40 per cent reduction over and
above the 10 per cent removed prior to the application of the value
analysis techniques. Tooling costs in this case were almost negligible-less
than one-fourth of the annual saving.
8-5 Use Real Creativity

When a new and better method is needed to excel in competition, it may
b e sought by either of two means. The first and most common is to
obserue, in other products and processes, the approach that accomplishes
functions that are similar to the function required and then adapt that
approach. The other means is to produce mentally a new approach-one
that has never been seen and, perhaps, one that has never before existed.
This process is called creativity. In using it, knowledge integers, or, in
modern-day computer language, bits, that have not been associated be-
fore are connected, or associated. For example, growing green grass has
not been commonly associated with the hood or exterior of an automobile.
Some paint-like material is usually associated this way. To consider grow-
ing grass, which must be periodically cut, as the finish for an automobile
is a new association. Thinking that could later spring from this associa-
tion has a better chance of being totally new. Unfound good solutions
are more likely to be found, and the finder can reap the original benefit
during the period when these solutions are being copied by competitors
who are not using creative problem solving.
When value analysis is used for the purpose of assuring profitable suc-
cess in competitive markets, it is absolutely mandatory that good creative
thinking processes be used. As soon as functions are clearly known, the
problems can be "set" in sentences beginning with "How might we . . . ,"
and intense creative thinking can and must begin.
The most common obstacle to deriving results from attempts to be
creative in developing ideas lies in the natural tendency to let judicial
thinking interfere with mental associations. For that reason, the main
requirement in applying the creative technique is to defer judgment.
Unless that be done, progress is soon retarded by sentiments such as "It
can't be done," "It won't work," or "Specifications won't allow it." Such
negative thoughts hamper a free flow of imagination; the things that they
imply must be left to be explored in a subsequent step.
Another obstacle to getting creativity into action is the tendency to
associate creative thinking with intricate and complex problems. The fact
is that even the simplest problems benefit from being dealt with crea-
tively. The thing to guard against here is the application of creativity in
the wrong directions. For example, in one case on record the problem
was to seal off a 3-inch pipe. Here the designer chose to be creative by
laying out a special pipe plug that served the function well indeed, at a
manufactured cost of $15. Had he applied his creativity to searching out
the best plug for the purpose from available supplies, he would, no
doubt, have chosen to purchase a perfectly serviceable plug from a local
plumber dealer at $3, thus avoiding a needless outlay of $12 that re-
turned no value.
A third cause of restricted use of creative thinking is often found in
the difficulty people may experience in getting a chain reaction of ideas
ignited and then sustained. In such instances, experience indicates that
a brainstorm session with, say, three or more participants works won-
ders. In the competitive atmosphere of such sessions, one individual's

idea soon stimulates other ideas both in the mind of the individual him-
self and in the minds of his associates. The extent to which this happens
is indicated by the following yields of two group-brainstorm sessions. In
the one case, the problem was "how to detect that someone is at the
front door and wishes admission." The record of that session showed a
total of 109 different ideas for solution of the problem. The other instance
had to do with how to join together two electrical conductors. Here, the
record was comprised of 140 varied ideas.
Sight should not be lost, though, of the fact that an individual by
himself can stimulate his own imagination or creative thinking by very
simple expedients. For instance, anyone confronted with the problem
of how to best join two flat pieces of material may derive helpful sug-
gestions from merely glancing observingly around the ordinary office. As
the eyes pause on the paste bottle, the cement tube, the Scotch tape roll,
the paper stapler, the hole punch, or the clip tray, the mind is auto-
matically directed toward the alternatives of pasting, cementing, taping,
stitching, riveting, and clamping the pieces together.
Whether the application of creativity is exercised by the individual
alone or in group brainstorming the important factor, as already indi-
cated, is to let no judicial thinking eliminate any idea that comes to mind,
regardless of how ridiculous it may sound at first. Every idea that
emerges spontaneously deserves to be jotted down for further considera-
tion. What this means, then, is that whenever the ready flow of ideas
stops, each idea on the record must be evaluated in terms of what effect
its development may have on the ultimate goal. A farfetched idea may
then appear to hold the best promise of yielding the most substantial
benefit in its developed state. Thus that idea, rather than the idea that
seems the easiest to develop, may be the one to concentrate on. In this
connection, it is well to bear in mind that development work on one idea
frequently leads to other ideas of even greater benefit. Hence no idea
should be forsaken until an attempt has been made to develop it to the
extent that it deserves.
EXAMPLE 1: The United States Navy's bulkhead-penetration
project culminated in the use of a combination of fiber supports and
epoxy-resin sealing by air-gun extrusion. Compared with the standard
variety of metal bulkhead penetrations, the cost of the new method
came to one-fifth of the earlier cost and opened up opportunities to
make sizable savings, more than $70,000 a year in one naval shipyard.
EXAMPLE 2: Application of squirted-in self-vulcanizing material
to take the place of ready-made rubber gaskets resulted in a cost
reduction from 11 cents to 1 cent per seal. This solution went back
to someone's inquisitively asking himself, "Wonder what use I could

make of the jar-sealing gaskets that my wife buys for practically
nothing at the dime store?" (See Figure 8-20, page 150.)
Because the methodology of creative idea development is a subject
that in its own right is illuminated by several good books and many
courses in universities and elsewhere, it would be redundant here to
include the step-by-step procedures for obtaining good results. Suffice to
say that creative idea development must be mastered and used by anyone
who expects to use value analysis effectively.
8-6 Identify and Overcome Roadblocks

There is hardly a person living who has not been impressed by the
effectiveness with which some product accomplished its purpose, only
to be superseded some time later by modifications which performed the
same function much more reliably at a much lower cost. It is normal
to accept, as being "near perfection," the good work which has been
done on something that accomplishes its purpose well today. It is shock-
ing to later learn that the same functions could have been performed
so much better at a lower cost even at the earlier date.
Why, then, were these functions not accomplished at lower cost
earlier? Something prevented it. Most likely, continuation of the study
involved ceased, as did work that might have resulted in improvement.
Design and manufacture were centered on the product as it was. In some
instances the material or process that would yield the function at a
lower cost was nonexistent at the time of the earlier design. Experience
shows, however, that, in nine out of ten cases, applicable processes or
materials or perhaps special products did exist and could, in fact, have
been included in the earlier design and manufacture.
The natural question here is: "Would not benefits have resulted from
putting into earlier use such processes or materials which accomplish
the total function more reliably, perhaps more simply, and at lower cost?"
Checks indicate that the answer is usually "yes." What, then, stopped
action for better value in nine out of the ten cases? Roadblocks-occa-
sionally real but mostly imaginary, occasionally technical but mostly
human.
The purpose of the technique of identifying and overcoming roadblocks
is to help develop these situations and prevent value work from so often
stopping short of adopting accomplishable value alternatives. A road-
block, as that term is used in the present connection, is a decision that
prevents timely development of appropriate value alternatives. The cause
of it may be a lack of information, acceptance of wrong information, or a
wrong belief. These factors cause the decision maker to decide that it is
Results Accelerators 11 7
not wise for him to continue to work toward lower costs at the particular
time. The sort of roadblock in question occurs after tests have shown that
the performance objectives have been met. Value objectives, being less
clear and not as measurable, are given secondary consideration, and
decisions tend to be made to proceed with the drawing up of the designs,
with the buliding of tools, and with manufacturing.
Some of the common roadblocks met with are:
There is no better material.
This is the best process considering quantities.
There is probably no better way of doing it and we are short of time
anyway.
This has been proved to work. We won't change it.
Underwriters' wouldn't approve any other arrangement.
This is the result of a lot of study. It will be far better than com-
petition.
We changed that a few years ago and got into an epidemic of trouble.
We are not changing it again.
We had to maintain interchangeability.
You can't beat an automatic screw machine for any part that it can
make.
We have ten turret lathes; we certainly make money by designing to
keep them busy.
There is no other source of supply.
We can't pay for the tools.
It doesn't make sense, but it's policy.
We know more about this than anyone else.
There is no plastic with those properties.
It is impractical to make castings that small.
It costs too much to change the drawings.
The customers like it this way.
It is important to bring these roadblocks clearly into the open and
to recognize that they usually represent the honest beliefs of the men
who make the decisions. To achieve improved reliability, simplicity, and
lower cost in these circumstances, more correct information must be
injected into the situation with proper timing and presentation so that
the decision maker will use it.
EXAMPLE 1: Rather large quantities of asbestos paper were used
for one application at a time when asbestos was in short supply and
was, besides, a costly item. Its function was to catch paint drippings
in a dip-painting line. When the value consultant questioned the use
of asbestos for this, he was told that it was the only material that fit
the specification and had the approval of the fire-safety committee.
The roadblock clearly was that the fire-safety committee would not
allow the use of anything other than asbestos paper. New information
was searched out from manufacturers of special papers, and when it
was found that "nonburning" paper could be made, samples were
obtained. Tests were made and the new paper proved to serve the
purpose reliably. Based on this new information, the roadblock was
overcome. The result was an improvement of value and a lessening of
procurement problems.
EXAMPLE 2: A stainless-steel nipple for conducting water into
electrical equipment cost 20 cents and was required in large quan-
tities. It was manufactured by purchasing standard fittings and then
modifying them. Manufacturing alternatives were later provided in
the creative phase of a manufacturing value study. The finding was
that the parts, made from tubing by semiautomatic machines, could
be purchased for 5 cents each. The roadblock clearly was a statement
put on the drawing for the guidance and instruction of the purchas-
ing department. It said, "Purchase stainless fitting #AB 1025, modify
as shown by the drawing." Again, with the roadblock clearly in view,
action could, as is usually the case, be taken to overcome its costly
effects. A review with the engineer disclosed that when the item was
designed ten years earlier it was a relatively low-volume item, and
the most economical way to provide the fitting was as specified. Some-
time during the years, matters changed so that the opposite situation
was now true. Of course, there was no reluctance on the part of
engineering to immediately strike from the drawing this roadblock
specification.
EXAMPLE 3: ''It iS patented." A rather complicated arrangement
was used to support about fifty pounds of rotating equipment on a
high-volume product. Application of value analysis techniques
quickly brought forth the information that a simple construction for
the support would cut the cost by 40 cents and result in an annual
saving of $%,000. However, the objection arose that the simple con-
struction could not be used because it was patented. The roadblock
came into clear view. Obviously, the simple construction should not
be used if it were covered by a valid competing patent and if
licensing could not be arranged for at a cost substantially less than
$24,000. A patent search was initiated, and soon the attorney re-
ported that there was no patent in existence that read on the simple
construction which would most effectively and economically accom-
plish the function. This eliminated the roadblock and allowed action
to simplify and improve the design, with the additional benefit of
eliminating the $24,000 of unnecessary cost.
T h e fact remains that this "belief," until corrected, was just as

effective in adding $24,000 to the cost as some additional customer
requirement or additional new feature would have been.
EXAMPLE 4: "Underwriters' wouldn't approve it." A very simple

and functional design for a socket to hold a light bulb was suggested
by a value analysis study. T h e verdict of the engineering people of
one company was that t h e design would accomplish t h e function
reliably but that it would never b e approved by Underwriters'.
Hence it was not adopted. Again the roadblock was in clear view. I t
is interesting to note that a socket incorporating the main features of
this proposed design was put on the market by another manufac-
turer a few months later. I t bore the stamp of Underwriters' approval
as it should have, because it accomplished its function with total
reliability and total safety.
This specific technique of identifying and overcoming roadblocks is

another item in the kit of tools which is positively essential for the
professional value engineer to learn to use effectively.
Case Study
IT WON'T WORK
Truth is indeed often stranger than fiction. A most interesting and typical
example of such a situation is the case in which 800 small brass cams were
required per year. These cams were being machined from %-inch brass
material, and because of their unusual shape, the machining operations
did not lend themselves to any simple mechanical routine. Because the
quantities were so low, it had also been determined each time a change
was considered that it would certainly not be economical to purchase tools
for stamping them out.
The value engineer, in looking at the job and in creatively searching for
alternatives, felt that it was worthwhile to consider the use of a Kirksite
die. Kirksite resembles lead and is commonly melted and poured into a
die around a model of the part required. When it has set, it is hard enough
to be used for a tool to blank out a good quantity.
A manufacturing methods engineer, whom the value analyst succeeded
in interesting in the project, decided it had a chance of working and
thought he would like to try it. Hence, he asked his boss for a shop order
of $50 to give it a try. He didn't get it. The boss said, "It won't work."
Meanwhile, the engineer's interest in the project grew, and he went on to
tell the boss's boss what he had in mind and said he wanted the $50 to try
it. Again he was told, "It will never work." By now he had become so
enthusiastic about the idea and so involved in it that he decided to run
the risk of going to the top and telling the manager of manufacturing
about it. This he did; once more he asked for the needed $50 shop order,
only to be told that he couldn't have it because "it wouldn't work."
During the following few days, the idea stayed with him, and his frustra-
tion turned into constructive emotion. He decided he would do it anyway
and charge it to another shop order which he already had. It worked. The
demonstration was amazing. He decided to get the worst over first by
telling the manager of manufacturing, and when he did, he was im-
mediately given an opportunity to demonstrate. The amazed manufactur-
ing manager called in a number of his subordinates and they were given
the same demonstration. These people, in turn, called in a number of their
engineers for a demonstration. Each time a few pieces were run off and
checked for dimension.
An interesting happening was that, at the end of the day when the parts
were viewed, it was decided to send them to the storeroom for use in
production; as they were counted, it was found that they made up enough
parts for two years of production.
After a roadblock is identified as such and eliminated, it appears
v e y simple; prior to this, however, it is formidable and totally stops
action.
Case Study
UNDERWRITERS' WON'T ALLOW IT
An electronic control contained twelve binding screws. The function of

these screws was to hold small wires in positive contact on their terminals.
Quantities were 50,000 controls per year which meant 600,000 screws. The
screws cost $6 per thousand although they were very similar to screws
which cost $2 per thousand.
Why this three times increase in the cost? The answer was that although
$2 per thousand would buy small No. 8 screws of the proper size and type,
the specifications called for No. 8 screws with smaller No. 6 heads. This
made the screw a special. The use of technique 12, "utilize applicable
standards," showed that two-thirds of the cost might be unnecessary. When
the question of "why?" was raised, the answer from technical people in-
volved was, "Underwriters' requires a No. 8 screw." Examination of the
assembly showed that, as it was made, the head of the No. 8 screw was
slightly too large to facilitate assembly in the installation of one of the
twelve screws. Hence No. 6 heads were put on No. 8 shanks for all of the
screws. When the question was properly explored with Underwriters', its
answer was, "We felt it desirable to specify a No. 8 screw so that it would
have a large-enough head to make extra-positive contact with the small
wires."
Now that this roadblock was illuminated with more facts, it was obvious
that putting the large shanks on the screws at three times the cost made no
contribution of any kind. As a result, Underwriters' was asked to reexamine
the application, and it subsequently approved a screw which cost $2 per

thousand-one-third of the cost-as totally functional and safe.
In this case, as in many others, better answers did not come forth until
technique 6, "identify and overcome roadblocks," was applied.
8-7 Use Industry Specialists to Extend

Specialised Knowledge
Getting an acceptable degree of value means accomplishing functions as
well as competition does. Getting good-grade value means doing it better.
The former is accomplished by getting answers as good as competition's;
to accomplish the latter, better answers are required.
The question, then, is how to get better answers. The procedure is as
follows:
Establish clearly in the mind exactly what is to be accomplished, i.e.,
precisely what functions are desired.
Place better alternatives before the decision makers.
Get an action pattern established so that the information on the best
alternatives will be promptly used in decision making.
In providing better answers for the accomplishment of each function,
we must first ask: What technology is involved? For instance, does the
problem primarily involve:
Circuitry: Metals :
Electrical Corrosion-resistant
Magnetic High-temperature
Conduction : Heavy-duty
Electrical Lightweight
Hydraulic Nonmetallics :
Heat transfer Paper
Design : Plastics
Arrangement Rubber
Styling Wood
Mechanics : Processing:
Gears Material removal
Linkages Forming
Servomechanisms Joining
Packaging
The quality of the answers suggested is dependent upon a number
of things. Obviously, one of the most vital is the depth of penetration
of the subject matter brought to bear on the problem. If we take the
known penetration of any technology as 100 per cent, what depth of

penetration into each applicable technology can be expected in any
specific instance? Is the answer, say, 25 per cent penetration? Probably
not-or at least not in more than a certain few technologies. In most
cases it is reasonable to assume that we get down considerably lower.
Let us assume that the personnel concerned with developing and
selecting engineering and manufacturing alternatives which establish
the degree of value in their product apply a knowledge penetration of
10 per cent on the average. The quality of the answers then arrived at,
compared with the answers which could be obtained with available
knowledge applied, cannot be good. Special knowledge in depth in the
areas involved must be brought into the work to a greater extent before
decision making. Furthermore, it must be remembered that knowledge,
techniques, and processes are continually being developed in each tech-
nology and that only the specialists know of those which have become
practical within the last year or two. Of still greater importance is the
fact that these industry specialists are continuously working on advancing
knowledge in each technology. The developments they complete one
year will begin, perhaps, to come into usage the next year and will gain
increasing use during the years immediately following. Only by bringing
these specialists into touch with the functions needed in the product can
the better answers derived from the latest within their technology be
obtained so that a good or excellent degree of value may be ensured.
Case Study
DO IT LIKE AN INDIAN
Scarcity of stainless steel and innovation in attractive anodized finishes for

aluminum made it advisable to seriously consider a good welded-aluminum
construction for an appliance shelf.
After a few months of study, however, it appeared that the project
should be abandoned because of an inability to weld suitable aluminum
which would take an acceptable finish with sufficient dependability. One
engineer dissented, saying, "I don't think we ought to quit. Why don't
we try doing it like an Indian would?" When questioned by the engineer-
ing manager as to his meaning, he said, "I only mean that an Indian
wouldn't weld it, because in the days of Indians, they didn't have
welding."
He was put in charge of the job. His first action was to utilize the value
analysis techniques to obtain, as quickly and efficiently as possible, all of
the industrial know-how from industrial specialists. This resulted in visits
to two fence manufacturers to learn approved practices in bending, crimp-
ing, twisting, and otherwise fastening wire to wire.
So much technology new to the appliance business but, in fact, old to
the fence business came into immediate focus that before long practical
designs had been developed, tested, proven, and put into production with
retention of the desired aluminum construction. For his accomplishment,
the engineer received a special award from his company-a personal gain
further recognizing his benefit to his company.
The concept of drawing on industrial specialists to extend the use of
specialized knowledge is so simple and straightforward that it ought
to be one that is followed as a rule rather than as an exception. That,
however, is contrary to the facts. There are several reasons why this
is so.
1. Unfortunately for the cause of value, contributors r:ommonly have
pride in what they do. Each individual, when he receives an assignment,
becomes interested in it, intrigued by it, and challenged by it. He puts
his body, his mind, and his emotions into it, and often he develops
several answers. When tests show that they, or at least one of them, will
work, he develops "pride of authorship." He may have attained neither
excellent nor a good degree of value, but physical tests do not show that
up. Therefore, he proudly supports any related projects of engineering,
manufacturing, purchasing, or management, and the product is born.
2. In the past, when a good degree of performance was required but
there was little emphasis on a good or excellent degree of value, it may
or may not have been necessary to call in help. Just the same, it has be-
come a quite well accepted practice, if performance problems continue,
to call in industrial specialists to help solve the performance problems.
In contrast, relatively few people as yet have become used to drawing
on the technology of such specialists in order to get better answers which
will improve reliability, provide simplicity, and result in lower cost.
Habits and attitudes of the past work against this simple expedient.
3. Supervisors and managers, lacking sufficient competitive experience,
may interpret the action of drawing on specialized knowledge as a sign of
weakness. Even today, superiors will occasionally measure their people
by their individual ability to solve the problems they meet up with with-
out calling in extra help. Such an attitude may have been excusable in
the past when there was so much less depth of knowledge in the various
technologies and when the primary effort was performance-oriented. The
fact remains that it has led to staggering, and sometimes bankrupting,
amounts of unnecessary cost in products.
4. Individuals sometimes lack recognition of the existence of more
knowledge pertinent to their work than what they have at hand.
5. People often do not know where to go to. get more knowledge
pertinent to their work, although they may feel that it probably exists.
6. The additional knowledge costs money. When a man buys an auto-
mobile, he sees, tests, and evaluates the automobile, then pays his money
for it. He knows, in general, what he will get before he makes the
decision. The exact opposite is true in the case of acquiring the help of
technical industrial specialists. If the accomplishments they can provide
were known beforehand, their services would be unnecessary. But the
fact that their services must be solicited and will cost money before their
contributions can be known is a strong deterrent to their use.
7. Securing more know-how may mean delay, especially if it is called
in belatedly at quite a late stage of product development. It seems much
easier to go ahead with plans as they are. The product is known to have
performance, attractiveness, and suitable features, and often it is assumed
that the value is good. That is particularly so when some ingenious
moneysaving ideas may have been developed in the course of the value
work.
EXAMPLE 1: Heat-transfer enclosure. A complicated metallic en-

closure of a space, approximately 2 cubic feet in volume, had the
primary function of transferring and dissipating heat from the equip-
ment which it contained. It had fins and other elements of design
and construction for accomplishing this main function, which it per-
formed very well. It dissipated the necessary amount of heat and
helped to make the product perform entirely satisfactorily. It was
made in moderate volume, and its cost was $74.
During a value program, a heat-transfer specialist was invited to
look into the application. The result was that, within a week, design
and manufacturing concepts were provided which accomplished the
total function more simply with less weight and with complete reli-
ability for $16.
EXAMPLE 2: The linkage. As today's products become more and

more adjustable and more and more automatic, the development of
simple, reliable, low-cost, effective linkage is changing from an art to
a science. It is true that virtually any engineer can develop a linkage
that will perform any job. The variation comes in the complication,
reliability, and cost. It is not unusual for the number of parts to vary
from five to one and for the cost to vary from ten to one.
A linkage used for a lifting mechanism, in moderate volume and
in rather heavy equipment, had proved thoroughly reliable in accom-
plishing its performance function. The cost of the linkage, based on
the usual volume, was $285,000 per year. During a value study, a
linkage specialist was asked to review it and submit suggestions. In a
week's time, he came up with sketches and suggestions for a linkage
which completely retained the reliability and performance character-
istics and, in addition, provided further simplicity, at a cost of
$90,000 per year.
EXAMPLE 3: Gyros. In a military product in which weight was

very important, gyros were used for a specific function. Since cost
controls quantities in military purchasing, it too was an extremely
important factor. During a value study, electronic specialists examin-
ing the functions to be provided advised that an electronic circuit
would accomplish the total function of one of the gyros and elimi-
nate weight, provide simplicity, and do away with large amounts of
cost. The result was important improvements to the weapon.
The reader will recall that the greatest causes of roadblocks which are
responsible for stopping at cost levels as they are instead of continuing
projects until very much lower cost levels are attained are:
Lack of information
Wrong information
Wrong beliefs
The technique of using industrial specialists to extend specialized
knowledge is usually essential in penetrating roadblocks to achieve very
much lower cost levels and very much higher value levels.
To get top-grade value, it is essential that needed functions be clearly
identified first. Then, the best of industry specialists must be ap-
prised of the function to the end that they contribute their knowl-
edge and technique to the securing of the simplest, most reliable, and
lowest-cost means for accomplishing these functions.
8-8 Get a Dollar Sign o n

Key Tolerances
Why are tolerances specified? The simple answer here is that tolerances
are specified where and as required to obtain a necessary fit or to allow
essential assembly. Nevertheless, confusion often causes tolerances to be
called for unnecessarily, as illustrated by the following answers to in-
quiries from actual cases.
The designer or draftsman "thought" that the tolerance he specified
was needed to obtain required fit.
The designer or draftsman didn't know, but to "make sure," he in-
cluded a close tolerance or precise specification.
The designer "thought" it to be standard practice to specify tolerance.
Tolerances were included to avoid an "incomplete" drawing.
The designer "thought" the tolerance used would not increase costs.
The designer "thought" the tolerance to be in harmony with avail-
able economical materials specifications.
Variations of raw material in past years made it "seem" necessary.

Interchangeability with former products made it "necessary."
The way mating parts were joined, it was "required."
Case Study
IS THE VALUE $60 PER THOUSAND, OR IS IT $1
PER THOUSAND P
A small precise part resembling the top half of a shingle nail was used in
quantities of 700,000 per year. The cost was $60 per thousand-6 cents
each. What would a shingle nail cost? Perhaps %o cent?
The part was found to be made of carbon steel, to have a very precise
head, and to have a %-thousandth tolerance on the shank part. In opera-
tion, it acted as a valve. The exactness of the head was quite important.
The function of the shank was the normal one of locating the functioning
head. The precision in the head was adding to performance. The precision
in the shank was adding only to cost. The shank precision made manu-
facturing the part a very costly job.
Suppliers who specialize in economical manufacture of that type of
part were shown the item, shown its performance, shown the precision
needed in the head, and shown the function of the shaft. The result was
a quotation of $1 per thousand. The shank would be held within a toler-
ance of two thousandths.
The engineering group could see no reason why this alternative would
not work and proceeded to find out why the %-thousandth tolerance was
specified in the drawing. The draftsman recalled a discussion of it with
the engineer at some previous time, when they had both decided on the
%-thousandth tolerance. The reason neither could recall. Tests were made.
No benefit resulted from shank precision. The change was made, the
identical function was obtained, and the cost was reduced to one-sixtieth
of the former cost.
Close tolerances, when they conform to standard practice and are pro-
vided automatically from properly adjusted machines, do not add sub-
stantially to increased cost in a good many cases. Often, however, from
any list of tolerances, there are one, two, or three which produce shock-
ing increases in manufacturing cost. These must be known for proper
decision making.
The real objectives of tolerances, of course, are:
To assure a product which will work, i.e., provide use functions
To provide a product which will sell, i.e., provide appearance functions
To provide a product which can be manufactured at lowest cost
Regrouped as follows, these objectives become more readily applicable

as a guide to study and to decision making.
To provide use functions reliably at lowest cost
To provide aesthetic functions reliably at lowest cost
On each tolerance called for, it is essential to raise the basic value
analysis queries of:
What function does it provide?
What does it cost?
For efficient use in identifying unnecessary costs, these questions are
here best reversed.
What does it cost?
What function does it provide?
What the key tolerances are is the next point that must be nailed down.
If, in reality, the cost of the tolerance is found to be trifling or negligible,
then it may be passed up without further consideration in the application
of this technique. But if the cost it introduces is substantial and impor-
tant, the function it provides must be brought into clear focus so that it
may be subjected to all applicable techniques to creatively generate and
crystallize value alternatives.
This process of associating cost with each function automatically
locates key tolerances as far as cost is concerned. For example, iron pole
pieces used on speakers, as shown in Figure 8-8, were called for to these
specifications:
Length, 1/2 inch rt0.002inch
Flange, 1/32 inch k0.002 inch
Diameter, 1/2 inch +0.0005 inch
Perpendicularity of face of flange to axis of
cylinder, + 1/2
Finish:
Surface of flange, F5
Fig. 8-8 Pole piece.
Surface of cylinder, F5
The method of manufacture involved the use of an automatic screw
machine making 2 million per year. It is obvious that tolerances must be
evaluated in relation to each method of manufacture or process which is
being considered. In this case, a study of each tolerance as produced on
the automatic screw machine-using the annual cost for the normal yearly
volume-would promote proper refining and improving of that process.
The yearly increase in cost for each tolerance above that which the
equipment would take in its stride at fastest speeds and with minimum
maintenance comes to:
Yearly total part cost

Special tolerance costs:
Length, 10.002 in. 1,000
Flange, f0.002 in. None
Diameter, h0.0005 in. 5,000
Perpendicularity, f x0 2,000
Finish:
Flange
Cylinder
All other costs
We now rearrange these costs. For example:
Finish cylinder $6,000

Diameter, ~k0.0005in. 5,000
Finish flange 4,000
Our study then proceeds along these lines:

What use functions are believed to be provided by the $6,0007
What aesthetic or appearance function does the $6,000 bring?
To what extent are these beliefs valid?
What alternate processes, tooling, equipment, or technology might
reliably achieve the valid tolerance requirement for lower cost?
Next, the various applicable value analysis techniques are applied to
develop lower-cost value alternatives for achieving the specified toler-
ances. Similar studies are made for each other significant item of toler-
ance cost, and then we examine other processes for manufacturing the
part, for example, cold coining. A preliminary review shows these figures:
Yearly cost of parts

Tolerance costs:
Length, &0.002 in. 20,000
Finish flange, F5 10,000
Flange, &0.002 in. None
Diameter, 10.0005 in. None
Perpendicularity None
Finish cylinder, F5 None
All other costs 20,000
Proceeding with an analysis, a natural first question is: Why does

length plus or minus 0.002 inch cost $20,000 extra? The answer is: Be-
cause automatic slug shear cutoff cannot be used; special precision cutoff
is required. Now then, what function does the $20,000 buy? Answer:
none. The flange of the pole piece is located on the magnet. Magnetic
flux comes up through this flange, turns out radially to the cylinder,
passes through the cylinder sides into air, and then passes through the
cylindrical voice coil which surrounds the cylindrical pole-piece section.
The small end of the cylinder is adjacent only to air and a felt cover pro-
viding appearance.
What would modifying the tolerance on length from plus or minus
0.002 inch to plus or minus 0.005 inch do? It would eliminate $20,000 of
cost and produce no change in either use or aesthetic functions. Similarly,
why does flange finish F5 add $10,000? What function does it buy? The
flange is in intimate contact with the smooth, flat surface of the magnet.
It is desirable to have metal-to-metal contact between each particle in the
flange face and the magnet. Any roughness or unevenness on the flange
face would result in voids between the metal surfaces and lower the
efficiency of operation of the speaker. It is found that true flatness and a
controlled high degree of fineness of surface can be achieved by a Blan-
chard grinding operation after coining. Hence real use function is pur-
chased with this $10,000. That sum represents a useful, necessary, and
proper element of cost until and unless another reliable value alternative
can be developed which will accomplish it at lower cost. The operation is
retained, and the yearly cost of these parts becomes $30,000.
If it is not known how to accomplish a specified tolerance in a potential
value alternative, give each tolerance a dollar cost equivalent to the
dollars of economy that the use of this tolerance prevents. For example,
in the previous analysis, if no known way of obtaining the tolerance of
length plus or minus 0.002 inch had been developed, tabulation of toler-
ance costs, based upon the cold coining process, would be as follows:
Length, *0.002 in. $40,000

Flange finish 10,000
Other tolerances None
All other costs 20,000
This clearly and appropriately directs attention to the tolerance which

is "locking in" much cost and compels study and evaluation of the func-
tions provided by the $40,000 followed by application of the appropriate
value analysis techniques to the end of creating suitable value alterna-
tives.
In summary, the important questions to ask in this technique are:
Is the reason for the tolerance valid?
What other design concept, if any, would make it unnecessary?
Is the means for reliably securing the tolerance the most economical?
8-9 Utilize Vendors' Available

Functional Products
All products are developed to perform one or more main functions. The
bicycle, the turbine generator, the airplane, and the baby's crib, for ex-
ample, all serve principal functions for which they are purchased. Each
main function, however, is accomplished by a group of subfunctions,
each of which often has its own group of functional components.
The main function of the airplane is accomplished through a number
of contributing subfunctional components-the wings, the motors, the
body, the tail, etc. In turn, the functions of these various components are
accomplished by their functional components. The wing function may be
accomplished, for instance, by sheet aluminum, structural aluminum, or
magnesium and by rivets, fastenings, hinges, and supports.
Often, need has fostered development and has resulted in specific
functional products such as special hinges, special rivets, special tapered
structural shapes, and special gasoline-containing bags, to mention but a
few. The use of these products often provides a total function more
reliably and more economically than specially designed components.
When this is the case, design time and design cost are saved. Besides,
proved products can be used without expending time or money for
testing.
Available functional products commonly have low costs because the
specialty supplier has a s a c i e n t lead in his particular technology and
sufEcient manufacturing volume to produce reliable components most
economically.
This all sounds so simple-but! Practical circumstances and interfering
factors combine to cause far too little use of available specialty functional
products. Some of these circumstances and factors follow.
1. Individuals making assignments may not know or suspect that a
suitable product exists, so they proceed to have the design and develop-
ment work done.
2. Men given the assignments may not realize or suspect that ap-
plicable products exist. Hence they carry out the detail development and
design of the functional product assigned to them.
3. "Do-it-ourselves" forces are strong in most every phase of human
activity. The overpowering feeling is that "we can do it!" This is followed
by costly and detaild redesigning of functional products which already
exist.
4. "The boss assigned the work to me. He expects me to do it." Men
are very hesitant about spending time or money in any direction other
than the direct line of their superiors' instructions, as they interpret
them. Slow success or failure in direct harmony with bosses' directions is
not as damaging, by a factor of ten, to a man as slow success or failure

following a different approach.
5. Often there exists a belief that using the functional products of
others is evidence of a shortcoming or weakness and that it is par for the
course to be self-capable and self-integrated. This is the same as con-
tending that only the man who does not know how to swim gets a
boat.
6. A normal human characteristic is the tendency to place too much
confidence in what "we" do and too little confidence in what is done
by others. Much excessive "do-it-ourselves redeveloping of the wheel"
is backed by an erroneous feeling that better quality will thereby be
assured.
7. A self-injuring belief is that to protect "proprietary knowledge"
which no one else has, it is essential to design and develop all aspects of
a functional product, though it often causes delayed design, uncertain
performance, and high cost. Occasionally, of course, such a situation may
exist for short periods of time and will bring temporary benefits to offset
the inefficient "do-it-ourselves" philosophy. In such instances, very critical
reviews should frequently be made to determine when the proprietary
secrets have ceased to be secrets.
8. Because the results that a search for functional specialty products
may bring are not known before the search has been made, the tantaliz-
ing fear exists that, after time and money have been spent searching,
no suitable product will be found and that it will be necessary after all
to develop and design it.
9. "Do-it-ourselves" work can be planned. The objective, the resources,
the effort, the expected results in performance, cost, and time can all be
reasonably scheduled.
In contrast, search is more unsure; hence plans to search bring greater
insecurity, and the feeling of insecurity in a job, activity, or project is a
topmost reason for shunning the search approach. The task of locating
something-who knows where-that may or may not exist, compounds
insecurity.
10. Groups of people often have the belief that the accepted and
proper system is to "do it ourselves." To do otherwise means to deviate
from established procedure. Creative search for combinations of avail-
able functional products to accomplish the needed function is foreign
to their basic beliefs.
11. Men don't know how to efficiently and effectively start the chain
from no information on a particular functional product and quickly
penetrate haze to build up a valuable fund of information on specialty-
product availability, performance, and cost.
12. Often the belief exists that, in some way, various intangible, un-
identifiable benefits come from designing bit by bit and, hence, that
much special hardware ought to be made in in-plant manufacturing
space. The feeling is that resultant increasing activity in the factory will
increase profits, business stability, control of markets, and utilization of
resources. In consequence, a search for available functional products is
regarded as a search for something injurious to the business.
The foregoing factors will oppose effective searches for specialty
functional products that quite commonly aid in eliminating substantial
unnecessary costs.
Case Study
SPECIALTY PRODUCT SIMPLIFIED IT
Four thousand small hinges a year were made by producing an extruded

metal section which was then cut off and drilled for a close-tolerance hole.
A pin, also with very close tolerance, was inserted in this hole so that an
interference fit resulted and always held the pin in place. The cost of the
hinge and pin assembly was 30 cents.
It was recognized that the main function of the assembly was to act as a
hinge and that a secondary function, produced by costly close tolerances,
was to hold the pin in place at all times. The construction was brought to
the attention of a manufacturer who would make the hinge from sheet
metal and roll a suitable portion to receive the pin. His process was found
to be very practical except that the tolerances would not be close enough
for a suitable interference fit to hold the pin reliably in place.
In searching for ideas and alternatives to overcome this problem, thought
was focused on the use of a rolled, tempered sheet-steel pin as available on
the market in a variety of sizes. These spiral pins are made with a certain
springiness so that, when driven into a hole, they will expand and retain
their position. It was found entirely practicable to use such a spiral pin in
combination with the sheet-metal hinge, and the total assembled cost came
to 10 cents instead of 30 cents.
Available specialty functional products may be divided into two
classes :
1. Products that most designers expect to buy
2. Products that, although they often accomplish a needed function
at the lowest cost, are not commonly considered as items to be purchased
For clarification, a sample guide of products in these two classes, as
compiled for one specific usage, is shown below.
Commonly, designers expect that applicable standards will be pur-
chased to fill their needs, but they often overlook the opportunity to
have the desired functions accomplished reliably at the lowest cost
by also purchasing suitable specialty forms. ( A functional product, in the
present sense, may be a plain material, a part, or a composite figuring as

a "building b l o c k for more inclusive design combinations.)
ELECTRICAL
COMPONENTS
Apparatus type Headsets
Generators Loudspeakers
Motors Insulating materials
Converters Cloth
Rectifiers Fiber
Switchgear Glass
Circuit breakers Mica
Control devices Paper
Transformers Plastic
Part Assemblies Porcelain
Dry batteries Rubber
Capacitors Impregnated
Condensers Laminated
Potentiometers Molded
Rheostats Wiring devices and supplies
Resistors Wire
Coils Conduits
Contacts Cable
Magnets Terminations
Commutators Tapes
Collectors Cordsets
Slip rings Harnesses
Brushes Junction boxes
Brush holders Receptacles
Terminals Sockets
Electron tubes Plugs
Transistors Switches
Electronic circuits Fuses
Etched
Printed Instrumentation
Plated Test meters
Antennas Performance instruments
Microphones
MATERIALS
Ferrous and nonferrous Nonmetallic
Ingots Asbestos
Rods Cork
Tubes Felt
Sheets Fiber
Rolled Textiles
Stamped Ceramics
Ferrous and nonferrous (cont.) Nonmetallic (cont.)

Punched Glass
Perforated Paper
Rigidized Molded,
Sandwiched laminated,
Plate
Strip Chemicals
Shapes Organic
Wire Inorganic
Powder Synthetics
Castings Paints
Forgings Lacquers
Extrusions Varnishes
Metalizers
Machine type
Blowers Couplings
Compressors Clutches
Fans Flanges
Pumps Sprockets
Engines Pulleys
Motors Chains
Actuators Escapements
Bellows
Parts type Diaphragms
Housings Filters
Boxes Cast, Shock absorbers
Cases pressed, Mesh
Covers deep- Trim
Caps drawn, Fasteners
Cabinets fabri- Nails
Shields , cated Screws
Bearings Bolts
Sleeve Studs
Ball Vibration dampers
Roller Hangers
Needle Brackets
Jewel Pedestals
Shafts
Hardware type
Keys
Leadscrews Bumpers
Shims Casters
Retainers Handles
Spacers Knobs
Gears Tie rods
Springs Turnbuckles
Hardware type (cont.) Straps

Nuts Comers
Washers Hinges
Rivets Latches
Eyelets Locks
Staples Name plates
Stitches Tags
Clips Dials
Building supplies Faucets

Cement Gaskets
Cord
Mortar
Cork
Bricks
Cast blocks Felt
Rubber
Lumber
Sealing compounds
Coverings
Roof Ofice supplies
Wall Furniture
Floor Equipment
Trim Stationery items
Heating items O5ce machines
Conditioning items
Lighting items Packaging supplies
Bags
Maintenance supplies Boxes
Brooms Crates
Brushes Skids
Cleaning agents Pasteboard
Buckets Excelsior
Pails Shreddings
Mops Wrappings
Rags Cord
Steel wool Wire and straps
Waste Paste
Aprons Tapes
Gloves Labels
Plumbing supplies Shop stockroom supplies
Piping Abrasives
Tubing Cloth and paper
Fittings Compounds
Unions Powders
Nipples Grinding wheels
Plugs Sanding disks
Nozzles Sanding pads
Valves Sanding planes
Shop stockroom supplies (cont.) Wrenches

Adhesives Chisels
Cements Planes
Glues Saws
Pastes Punches
Tapes Nail sets
Compounds Hand drills
Caulking Augers
Cutting Bits
Dust suppression Drills
Impregnating Reamers
Insulating Taps
Sealing Dies
Descaling Fixtures
Rust protection Jigs
Marking C clamps
Soldering Air guns
Gaskets Soldering irons
Felt Torches
Leather Shears
Paper Shovels
Plastics Pickaxes
Rubber Rakes
Fiber Hoes
Metalized Instruments
Lubricating agents Gages
Greases Calipers
Oils Micrometers
Compounds Levels
Guns Rulers
Tools Squares
Axes Scribers
Hammers Compasses
Pliers Straight edges
Screwdrivers
Productive steps for locating available functional products are:

1. Learn and clearly understand the desired function, the basic step in
the application of any of the value techniques.
2. Search directories such as:
Thomas' Register of American Manufacturers
Thomas Publishing Company, 461 8th Ave., New York, N.Y. 10001
Mac Rae's Bluebook
Mac Rae, 903 Burlington Ave., Western Springs, Ill. 60558
Sweet's Catalog Files

McGraw-Hill Information System Company, 330 W. 42d St., New
York, N.Y. 10036
Consultation of these and other inclusive business directories may
be advantageously supplemented by referring to specialized sources such
as
Electronic Engineers Master-E.E.M.
United Technical Publications, 645 Stewart Ave., Garden City,
N.Y. 11530
Modern Plastics Encyclopedia
Modern Plastics, P.O. Box 809, New York, N.Y. 10036
Modern Packaging Encyclopedia
Modern Packaging, P.O. Box 809, New York, N.Y. 10036
Specialty manufacturers' trade catalogs.
3. Search appropriate trade shows, including exhibits at professional
societies' annual meetings and conventions; for instance:
Metals Congress and Exposition
American Society for Metals
National Plastic Exposition
Society of Plastics Industry
Annual Technical Conference
Design Engineering Show
Design Division, American Society of Mechanical Engineering
International Convention and Exhibition
Institute of Electrical and Electronic Engineers
American Welding Society's Annual Meetings and Welding Exposition
American Chemical Society's Annual Meetings
National Hardware Show
Instrument-Automation Conference and Exhibit
Instrument Society of America
Machine Tool and Production Engineering Shows
National Material Handling Shows
National Packaging Exposition and Conference
American Management Association
Society of American Value Engineers Conventions
This listing is but a sampling of the trade-show and convention type of
affair that has proved a profitable source in the search for improved
value alternatives. Innumerable exhibitions of this kind, covering prac-
tically every trade and profession, are held constantly both in the United
States and abroad. Where personal consultation at such fairs is not
practical, it pays the seeker of new and varied ideas to scan the widely
published accounts of what is being shown.
4. Search trade magazines. Where library services are available, re-
quest searches by them if needed.
5. Contact, by writing or phoning, competent men in related busi-
nesses. Describe to them the functions needed and ask for guidance. In-
quiries directed to a dozen or so of those who represent top thought and
knowledge in any one industry will often bring a most gratifying yield.
6. Make chain inquiries. Select, say, three men who have the best
chance of knowing where to locate what is needed and ask them for
guidance. If they don't know the answer, attempt to get names from
them of the top two men they would suggest. Continue this process as
long as desirable. It is surprising how soon very complete and valuable
information can be assembled from competent men in a wide variety of
industries.
Once suitable sources of special functional products have been located,
do not neglect to: (1)assist the functional product vendor; ( 2 ) interpret
the needed functions to him; ( 3 ) provide him with a broad and deep
feeling for the importance of the various functions, for the various
operating situations, etc.; ( 4 ) help him to develop practical suggestions
for using his product or combinations of his product; and (5) secure
tangible suggestions from him.
With the aid of a few examples, let us see how this procedure may
work out.
EXAMPLE 1: An adjusting screw that cost 8 cents was used to
facilitate adjustment of electrical equipment. In use, a stiff wire was
hooked into the hole in the head. The screw was lifted against a
spring pressure, turned as desired, and then lowered again, allowing
the cross pin to drop into a slot and be held by it.
Manufacture of the screw required 3/1 and % G-inchdiameter steel
as the raw material. The larger piece required cutoff, threading, and
drilling of two holes. The smaller piece required cutoff, assembly in
hole, and staking. The part was deemed so unusual that it was not
expected that a vendor made such an item.
A review of the function-not of the part-brought forth the follow-
ing requirements :
A screw having a hole in the top, or other suitable arrangement, so
it can be lifted and turned
A head arrangement that will be pulled back into the slot and held
to prevent turning.
A search of specialty products having these two characteristics un-
covered the spade bolt shown in Figure 8-10. Its cost was 1/3 cent
Fig. 8-9 Adjusting Fig. 8-10 Alternative

screw. adjusting screw.
(as compared to 8 cents). It accomplished all of the functions reli-

ably. It was readily available.
EXAMPLE 2: A spacer hub (Figure 8-11) that cost, in steel with
machining and drilled holes, $1.27 was undercut and turned from
steel bar. Its functions were to mount two disks of aluminum, which
were riveted through six holes, and to provide a mounting center for
this disk assembly.
Again, few would expect to find as an available product an under-
cut steel disk of the right diameter and right thickness; probably no
one would search for it and possibly no one would find it. But what
happens when we consider precisely what the function is?
1. Separate two Sinch diameter aluminum disks approximately 1/4
inch.
2. Provide for mounting them securely in an assembly.
3. Provide a center hole for mounting the assembly.
A search for specialty products which could be readily adapted to
accomplish these functions brought forth, among other alternatives,
aluminum disks or slugs that could be bought in bulk in a variety of
diameters and thicknesses for use in impact extrusion.
One such slug was of a suitable diameter and thickness. It cost
4 cents, but it was stamped from sheet and so was cupped, not flat.
Fig. 8-11 Spacer hub. Fig. 8-12 Alternative

spacer hub.
I40 Techniques of Value Analysis and Engineering
It cost 1 cent to flatten it and 8 cents to drill the holes. The total
cost of the alternative (shown in Figure 8-12) was 13 cents.
EXAMPLE 3: A %-inch diameter thin nut (Figure 8-13) cost
8 cents. Its function was to hold a small 1-pound assembly on its
shoulder bushing between periods of use and not allow it to fall off
while it was not being used. There was no load on the nut. When in
use, the force of the work held the assembly in working position and
the nut was not performing any function. A small radial hole was
drilled and tapped in the nut for a setscrew to reduce the risk of its
loosening. It was made from hexagonal steel bar on which the
necessary operations were:
Drill and tap the center hole.
Drill and tap the radial hole.
Cut off.
What precisely was the function?
1. To hold one pound onto the bushing
2. To provide unusual vibration-proof features so that, under all
conditions, the nut would not loosen.
A search produced a specialty product for this exact function in
the appropriate size and type, namely, a standard locknut (Figure
8-14) possessing exactly the needed characteristics. Its cost was
1% cents (instead of 8 cents). Besides, tests proved this locknut to
be more vibration proof than the former nut with setscrew.
EXAMPLE 4: A high-temperature locknut-castellated nut-(Fig-
ure 8-15), including the drilling of the shaft on which it was
mounted and the safety wiring on assembly, cost $4.75. The function
was to hold a heavy, high-temperature part to a moving shaft which,
to some extent, was vibrating.
Search brought forth a variety of locknut arrangements, most of
which were judged unsatisfactory because of the extremely high
temperature of the application. Then a manufacturer of nuts using
plastic locking rings was given the complete problem. His engineer
Fig. 8-13 Thin nut. Fig. 8-14 Standard

locknut.
Fig. 8-15 High-tern- Fig. 8-16 High-tem-

perature locknut. erature locknut.
said, "In our product line, we have a variety of locking materials

used for this function. Each is especially adapted to different en-
vironmental conditions. We can provide one which is suited to the
high-temperature operation in question. Of course, it will cost a
little more than our regular product." What he provided cost 23
cents and eliminated the need for drilling the shaft and wiring the
nut. It is shown in Figure 8-16.
Thus identifying clearly the needed functions and then searching
creatively for vendors of specialty products reduced the cost of
accomplishing the total function from $4.75 to 23 cents per unit. In
summary, the steps in this technique are as follows:
Recognize that for most subfunctions suitable combinations of
functional products already exist.
Learn how to identify clearly and review precisely the functions
needed.
Learn how to locate specialty functional products.
Use them.
8-10 Utilize and Pay for Vendors'

Skill and Knowledge
It is unimaginable that any user would design his own nails and buy
steel to make them. Nails fall within a group of functional products that
we are accustomed to buying. Likewise, few users would design standard
screws and buy metal to make them (unless quantities were large enough
for continuous runs on the most modern of equipment).
Many users, however, will design special screws and similar parts and
go on to buying metal and making them. The alternative is to inform
suppliers, who have the proper general type of equipment and accumu-
lation of skills, of precisely the functions that are required and knowl-
edge of the limitations on size, weight, shape, stress, etc. With such
information at hand, suppliers will gladly provide suggestions and quota-
tions. Often the costs of this procedure are from one-fourth to one-half
the costs of the "do-it-ourselves" method.
The objective in product development is to get the best solutions to

the problems involved in the shortest time and at the lowest cost. The
best solutions will accomplish the function the customer needs and will
provide the appearance that he wants. At the same time, they will do so
at lowest manufacturing cost and with a minimum of manufacturing
problems or quality difficulties.
The technique of utilizing and paying for vendor's skill and knowledge
yields exceptionally high returns when effectively used, for the following
reasons :
Large amounts of special knowledge exist in every field, and much of
this knowledge is not possessed by people in other fields.
Only a relatively small amount of the total special knowledge bearing
on any technology exists in any one place at any one time.
Special machines, fixtures, tooling, and equipment exist in large
numbers.
New developments known only to the engineers concerned with them
are in progress in most good supplier's plants. They represent the best
materials, processes, or parts to use "tomorrow" within the particular
technology. They can be put to use only if the supplier is called into the
job to which they are applicable. Suppliers want their new developments
to follow actual needs in the market and they are usually searching for
practical new ways of applying their technology. They benefit and the
user benefits by working together.
It is important to note that the use of skills and know-how of others
in the field of securing new performance is quite commonplace and quite
fruitful. Such use is motivated by tests showing that suitable performance
has not been secured. Faced with known unsuitable performance, the
search for better answers is self-forcing. In contrast, since value is not
measured, simultaneous realization that better answers are required
valuewisetis lacking; hence the course of action often taken is to choose
from the alternatives immediately at hand, and in reality, an integer of
value loss results.
Case Study
THE THREE SPRINGS
An electrical control used three springs:

One 1 inch long by 3/4 inch in diameter, plated steel, 23 cents; $23,000
per year
One % inch long by $4 inch in diameter, plated steel, 11 cents; $11,000
per year
One 34 inch in diameter by W inch long, tension loops on ends, phosphor

bronze, 17 cents; $17,000 per year
A supplier who had an established reputation as a top specialist in good-
value springs as well as for good performance in springs was invited to
look at the job. It was suggested to the sales manager of this specialist
vendor that he take the product, the drawings, and such other operating
and specification information as could be provided by the engineers, have
his technical people suggest precisely what springs to use, and then pro-
vide suggested costs for them. His answer was surprising: "I can't afford
to do it."
When asked to explain his stand, he said experience had shown that
when an engineer has had the drawing details and specifications of an
exact spring made up, it is offensive to him to receive a quotation unless it
is confined to precisely the geometry requested, and in the long run, the
submittal of a quotation is injurious to the supplier who makes the sugges-
tion. Only when the buyer who was taking part in the value audit of the
product brought the sales manager into direct contact with the engineer
and the engineer asked him to make a quotation did he consent to do so.
The springs were of such a standard nature that they could be made on
completely standard spring machines and the supplier offered to submit
five sets of samples for each of the first two springs and two or three sets
for the third. He said he would provide twenty-five samples each and
would furnish both a sheet of descriptive information telling exactly what
each spring was and a sheet of test data telling precisely what each spring
would do. This he did. The engineer was amazed and delighted. The cost
for the various alternatives generally ran from one-fifth of the present cost
up to the present cost.
After study of the test data and completion of some additional tests,
springs were selected with the following costs:
$16,000 per year instead of $23,000 for the first group
$3,000 per year instead of $11,000 for the second group
$9,000 per year instead of $17,000 for the third group
Besides, a modification of material on the third group provided improved
operation and greater stability throughout the life of the product. Utilizing
available supplier skills and capabilities pays of.
The business of industrial suppliers is organized along one of two
lines :
1. Make a product or provide a process which will accomplish some

known and needed function or group of functions, and then sell the
product or process. Examples are turbines, motors, lathes, hammers, air-
plane autopilots, printed circuits, photoforming.
2. Develop a group of skills, a body of knowledge, and a family of
facilities capable of accomplishing certain types of functions or certain
types of work, then merchandise this capability to those who have cor-
responding needs.
This second type of business is most vital to our economy but much more
difficult to merchandise than a product or process. The value analysis
technique that we are concerned with here ties in principally with the
second type.
To locate the best suppliers of this second category requires active and
effective search on the part of the user, especially since a vendor cannot
know what the needs are until he is located and told. The search is not
simple. The first half-dozen or so vendors to whom the needs are com-
municated may not be the few having the special know-how needed, and
thus the results become negative. Particularly high yields will be in pro-
portion to the skill and effort applied in using the tkchnique. Again, a
series of questions must be raised, such as:
What functions are required?
What processes might contribute?
What vendors lead in each area?
When the answers to these questions are established, the definite ac-
tions to take are as follows:
Get in touch with the indicated vendors.
Describe the technical situation clearly to bring out what is really
needed-the various functions; the limitations of size, weight, and dimen-
sion; the essentials of strength and appearance; etc.
State the economic situation clearly and fairly.
If there should be a prejudice by decision-making people against using
any item, such as, stampings, castings, forgings, plastics, aluminum, or
whatever, and the vendor's interest lies in that particular area, tell him
just what the situation is. If he is competing against in-plant manufac-
ture, tell him so and tell him the basis of the competition. If the product,
even after development, has a questionable market volume, tell him that
too. Only then can the supplier appraise the total situation and decide
what amount of his resources it will be good business for him to commit
to the solution of the problem.
The next step should be to allow the vendor's technical people time
to study alternatives, to develop and test new answers, and to make a
solid and new contribution. It is vital at this stage that the vendor be
given every opportunity to ask more questions about what is important
and what is not important, and also that he be assured that his suggested
solutions will be given attention by people who decidedly want the pro-
posals to be satisfactory for the particular purpose.
Alternatives submitted should be reviewed objectively and the best-

appearing value alternatives should be selected for possible further im-
provement. Objective information on shortcomings should be taken back
to the submitter and help should be given him to overcome the objec-
tions, if possible.
Usually, of course, only one supplier can win, i.e., earn the business.
Several may work for it, but one commonly earns it. That is the nature
of doing business in the competitive system. The suppliers realize this
before they start work, and they fully expect that the supplier with the
best answers will get the order. All of this points up the great importance
of completely advising them before they start work. They must be made
acquainted with all of the "rules of the game7' before they decide to go
into it.
After a vendor has produced the best answer-one substantially better
than the one used prior to his work on the project-he has earned the
business and must be given the opportunity to retain it for a reasonable
length of time to fairly repay him for his development work.
It is indeed wrong, and cannot be tolerated, to:
Draw up his ideas and send them out to other vendors for quotation
Allow factory personnel to decide that they can make it that way in
the plant
Such actions will cause the best vendors to stop wasting their good
technical talent on the products or processes of the manufacturer in-
volved. Besides, they will thereafter turn to assisting his competitors in-
stead of continuing to help him. Paying for his work by placing orders
with him if he has contributed is not only the ethical thing to do but is
also, selfishly speaking, the only course of enlightened, long-range self-
interest.
EXAMPLE: Handle for machine tool adjustments.
An operator uses this lever to make necessary adjustments by turn-
ing it clockwise or counterclockwise. Screws in the ends have op-
posite threads, one right-hand and the other left-hand; hence rota-
tion in one direction lengthens the handle and rotation in the other
direction shortens it.
What functional properties are required?
A rigid handle to be axially expandable and contractable
A handle capable of 300 pounds pressure
A surface on the handle for ready hand grip
What process might contribute?
Machine from bar; knurl and tap
Machine from tubing; knurl, plug ends, and tap

Make from aluminum impact extrusions; plug open end and tap
both ends
Make from aluminum extruding tubing; plug ends and tap
Make from sheet metal, rolled and crimped; plug ends and tap
Make from suitable plastic
What vendors lead in each area? Select one or two good vendors
in each of the indicated areas, the number depending upon the im-
portance and amount of business involved. Follow through the re-
maining steps of the technique, as outlined above, with each of
them. Help each to apply his expert knowledge and facilities.
The results of the technique will now be apparent. The special
function required in the product will be reviewed in the light of the
most advanced skills, techniques, and facilities within several tech-
nologies. All resultant alternatives will be unveiled before the deci-
sion maker to enable him to promptly increase the value of his
product.
8-11 Utilize Specialty Processes

Generally speaking, all processes serve for one of two purposes.
1. They accomplish functions that can be performed in no other way.
2. They accomplish performed functions equally well but at much
lower cost.
The second group takes in an extremely large number of processes, which
are of vital interest in value-oriented work and which will be the group
for further study in this section.
All processes might further be divided into two classes.
1. Processes that are known and are reasonably well understood by
those who are making decisions
2. Processes that are not known to the decision makers but which
would be applicable and would accomplish the desired ends at very much
lower cost
Again, it is this second class that we shall deal with. Let us first see how
processes which will accomplish functions reliably at very much lower
cost but are not known to the decision makers at the particular time may
be brought into view and how their benefits may be utilized in value
work.
Of course, what is a special process today commonly becomes the
standard process of tomorrow. Therefore, a line between the special and
the standard process does not really exist, the differences being a blend-
ing of shades of gray. For practical purposes in securing important bene-
fits from the technique in question, the best definition seems to be that a
specialty process is an applicable process which would reliably ac-
complish the needed function for significantly lower cost and which
either exists or could, and would, be developed by some one who leads
in the technology involved if he understood the need for it.
For example, to the design and manufacturing engineers who designed
the J bolt shown in Figure 8-17 as a cut thread part costing 11%cents
each, the process of roll threading at a cost of 1% cents would be a
specialty process. Similarly, the hollow-forging method would be a
specialty process to engineering and manufacturing men who did not
know that hollow forgings 2 feet in diameter and 10 feet long could be
made with very high grade properties for $3,000 each after finishing
machining to take the place of a similar part made from solid material at
a cost of $6,000 each after machining.
The capabilities of specialty processes to accomplish functions per
dollar of expenditure extend far beyond what is normally recognized.
Such recognition by professional people engaged in technical value-
oriented work normally lags about three years behind capabilities. Gen-
eral recognition lags about ten years behind.
A good estimate seems to be that the recognition of normal decision-
governing design and manufacturing engineers lags about five years
behind capabilities. It is the purpose of the technique under discussion to
eliminate an important part of this five-year lag.
Most specialty processes go hand in hand with the never-ending de-
velopment of special tools. As a simple example, perhaps at some point
in the history of industrial development three types of hammers existed:
one for work with stone, one for the blacksmith, and one for the carpen-
ter. As a variety of work was brought to the carpenter, the familiar claw
hammer was developed to facilitate the nail-pulling process. Successively,
this tool has been further developed into a heavier hammer for the
process of laying oak flooring and a lighter and very much differently
shaped hammer for tacks, with the still further development of the mag-
netic head to make the tacking process even more economical. Similar
BEFORE AFTER Fig. 8-17 J bolt.

developments have taken place in hammers for metalworking and other

fields. Probably few engineers know all the various stages of develop-
ment of the simple hammer, each for the express purpose of improving a
building or manufacturing operation of a specific type, and generally for
the main purpose of improving value.
For another example, the casting process starts with the basic sand
casting and spreads into almost hundreds of different types of casting
processes. Some of these are uniquely appropriate to achieving a certain
function by the use of some particular metal or temperature range;
others fit for the attainment of specified tolerance, lack of porosity, de-
sired appearance or surface conditions, etc. A group of typical casting
processes are:
Sand casting Miniature casting
Precision casting Die casting
Shell molding Mercury cast
Permanent molding Insert molding
Lost wax process
Case Study
MOUNTING HOLES FOR PERFORATED SHEET
For an appliance, a %n-inch-thick galvanized-steel sheet, 1% feet wide

by 6 feet long, was used. To perform its function, it was necessary to
punch 10,000 holes in each sheet so that it became perforated. This punch-
ing cost 68 cents. To facilitate mounting the sheet, six more holes were
punched near the ends at a cost of 28 cents, bringing punching cost to 96
cents.
The 10,000 perforated holes served an essential function in the ap-
pliance, while the six additional holes served merely for mounting the part.
When these required functions were brought into clear focus with men
throughout the country who had specialized manufacturing know-how, a
supplier of continuous perforating equipment showed that the material
could be continuously perforated in the long uncut strip and that some of
the holes could then be used for mounting.
Investigation showed that the ends were bracketed and that cutting
through the perforated area would detract from neither usefulness nor
appearance. The change was made with a reduction of 59 cents per sheet
in punching cost.
Application of the technique of utilizing specialty processes involves
three steps.
1. Recognize that processes which would accomplish the desired func-
tions for very much lower cost ( a ) may exist and not be known, ( b ) are
being developed, or ( c ) would be developed if competent men in the

technology knew of the need.
2. Put in motion actions which will increase the likelihood that
specialty competence knows about, and becomes interested in, the
needed functions.
3. Assign time and effort to stay with each item until the minor prob-
lems, minor objections, and minor misunderstandings which always
arise in any new approach have been illuminated with useful and factual
information. The aim here is to ensure that the results to be expected
from the status of science at the particular time will indeed be developed
and made applicable to the particular project.
For a listing of typical specialty processes see Chapter 10. It should be
recognized that such listings may lag from three to five years behind
actual industrial capabilities. Also, available tables are useful guides but
do not supplant the further step of making direct contact with indi-
viduals who lead in any technology.
EXAMPLE 1: The undercut screw shown in Figure 8-18 was being
used in quantities of 20,000 per year. It was made on a screw
machine from steel bar, was 2% inches long, and was undercut as
shown. A study of the functions revealed that the screw was a suit-
able means of accomplishing the functions, provided the undercut
could be produced more economically.
A specialty manufacturer who produced cold-headed and roll-
threaded screws was among the ones contacted and informed of the
need. He did not have a process "on the shelf' which would serve
economically but he took the following approach: "I believe I can
adapt the roll-threading process to remove the metal from the under-
cut portion. I will try to first roll a thread and then roll another
thread so displaced as to remove the metal left by the first process.
Next, if necessary, I will complete the operation by rolling enough
successive threads until the metal has all been eliminated." He be-
came very much interested in adapting his process to the need, so
he tried it and it worked. The cost with the use of this specialty
process became 1%cents each, not 15 cents.
Fig. 8-18 Special screw at

one-tenth the cost.
EXAMPLE 2: The small bracket shown in Figure 8-19 was used in

large quantities and served to support a small spring assembly in an
appliance. It was made of steel on well-mechanized equipment.
Nevertheless, the drilling and tapping of two small holes brought its
cost to $13 per thousand.
The functional study showed that this was a simple and practical
way of accomplishing the function, provided the cost of tapping the
holes could be lowered substantially.
Search for a specialty process brought one forth. A supplier recog-
nized this type of part as being sufficiently common in industry for
him to build a good business by creating special equipment around
it. In his special tooling, he bent the material and drilled and tapped
the holes all in one continuous process. As a result, he quoted a
delivered price of $3 per thousand for the identical part made from
the identical material.
EXAMPLE 3: Tube support gasket (See also example 2 in section

8-5. )
A molded-rubber gasket (Figure 8-20), a few inches in diameter
and costing 11 cents, was used in large quantities. The functional
study brought forth a number of alternatives for accomplishing the
function. Most of the alternatives involved the use of rubber or
rubberlike material but not necessarily a molded gasket of the
precise type used.
The search for an applicable specialty process identified a manu-
facturer whose equipment applied rubber directly to the needed
parts in plastic form. The desired result was obtained by placing a
small machine in the production line and applying the plastic rubber
directly to the parts in an operation that required but a few seconds.
The total cost for a functional product of the same high quality as
the former product became 1cent instead of 11 cents.
v BEFORE AFTER
Fig. 8-19 Bracket. Fig. 8-20 Tube support at one-
tenth the cost.
All cases of the profitable use of this technique to accomplish func-

tions for very much lower cost have the following in common:
1. No applicable specialty process is known.

2. There is no assurance that such a process does not exist.
3. The functions needed in the product, together with alternative
means for securing the functions, are brought clearly into view for study.
4. Based upon the likelihood that such specialized processes do exist,
or would b e created if proper information were provided to the proper
suppliers, a search is started and the information is furnished to men in
the technologies most likely to contribute.
5. Work is done with these specialists to obtain further information, to
overcome minor misunderstandings, and to change meaningless specifica-
tions to allow adaptation of the specialists' processes to accomplish the
needed functions at very much lower cost.
Case Study
THE TEMPERATURE-SENSITIVECONTROL (See also the case study in section 4-3.)
An electrical control, made in relatively large quantities, consisted of a
copper tube about 2 feet long attached to a bellows. The tube contained a
gas which was very sensitive to temperature. Expansion and contraction of
the gas operated the bellows to open and close electrical contacts. The
copper tubing, for most of its length, was ?4 inch in diameter, but for
about 4 inches at the far end, it was % inch in diameter. It was believed
by the engineers that the larger volume at the end was required in order
to give the desired sensitivity of control. The full length of the copper
tubing cost 10 cents or for a million per year, $100,000. Value work was
started in a number of directions.
Cost analysis showed that the proper lengths of the two sizes of copper
tubing cost 5 cents and the joining operation cost 5 cents, equivalent to
$50,000 a year. This immediately focused attention on the process of
joining which was accomplished by brazing. Searches for other processes
of joining failed to bring to light any useful alternative. Hence the func-
tion was more clearly examined and it was found that what was needed
was a small end about inch in diameter for mounting to the bellows and
a larger end to contain sufficient gas in the temperature control environ-
ment. It appeared that possibly what was in between did not matter. This
brought forth the idea of using a %-inch tubing and the process of swag-
ing it down. The cost would then become $70,000 per year instead of
$100,000. That alternative started a chain of useful results.
One process investigated was that of starting to draw the piece YE inch
in diameter and then, by some ingenious way, automatically opening the
die so that the 4 inches on the other end would not be drawn to the
smaller diameter. This solution proved very feasible. Samples were pro-
vided and proved excellent; the cost would be $60,000 per year.
Meanwhile, the engineers working along with the job continued taking
basic data and making basic tests to determine precisely the length of the
larger diameter needed at the end to give the sensitivity required. In
doing this, they discovered that, because of improvements in providing
gas with very much better temperature sensitivity than had been the case
in years past, the same control was attained without any enlarged portion
on the end. The tests proved that the use of copper capillary tubing some-
what less than 34 inch in diameter throughout its length and without any
enlarged section at the end provided the excellence of control needed. The
cost of this tubing came to 4 cents each, or $40,000 per year. The search
located two useful processes but the final best result came in this instance
from eliminating the need for the process.
8-12 Utilise Applicable Standards

To include this technique in the work guides of sophisticated industrial
people sounds almost too elementary. It gives the impression of some-
thing amateurish. I t is like being "for motherhood and against sin." Of
course, everyone is. The reader will soon find, however, that the tech-
nique, once used, becomes very valuable. Some approaches for applying
it successfully will be discussed.
The full meaning here includes not only use of applicable standard
parts and processes but appropriate utilization of parts of standard pro-
ducts, engineering concepts, manufacturing concepts, manufacturing
processes, and materials. It means, also, do not use standards that do not
apply.
So much has been so effectively written in the field of utilization of
standards that our intent will be not to repeat but rather to supplement.
Perhaps the best instruction on how to utilize the technique will develop
out of some specific examples.
EXAMPLE 1: A standard product
A special tube base costing $6.80 versus a standard tube base (Fig-
ure 8-21) costing $1.80 each accomplish the identical function with
the same reliability. Naturally, after a search has been made and the
standard is found, it is a matter of direct substitution.
EXAMPLE 2. A specialty product
A small aluminum knob and pointer were machined for use on air-
borne electronic equipment. The cost was $2.25 per knob. The
function was to provide for manual adjustment of a small potenti-
ometer. Available specialty products (Figure 8-22) in the form of
BEFORE AFTER
Fig. 8-21 Standard Fig. 8-22 Knobs at one-ninth the cost.
tube socket at one-
third the cost.
suitable plastics with metal inserts would accomplish the total

function with the same reliability for 25 cents.
Once this information has been secured and it is known that the
25 cent knob is available and will accomplish the function with the
same reliability, its direct substitution is a straightforward matter.
EXAMPLE 3: A standard process detail
A small spring was required to have hooks at each end (see Figure
8-23). One of these hooks, rather than being of the usual turn form,
was of an elongated shape. The cost was 9 cents. A study of the cost
showed that, by changing from the standard process of providing
a spring end hook and going to the special process necessary to pro-
duce the elongated end hook, the cost of the spring was increased
from 3 cents to 9 cents.
With this information uncovered, a study of the application was
made, and it was found that, with a minor change in the location of
the hole of the mating part, the standard spring-end process could
be used. By this change, the cost of the spring dropped to one-third
of its original cost.
EXAMPLE 4: DO not use inapplicable standard materials
Suitable standard wire screen was purchased, fitted, and properly
mounted for an electronic shielding function in which a certain
BEFORE AFTER
amount of ventilation was also essential. A study of the function of

the screen and its adjacent parts, together with an evaluation3f the
mounting and the supporting functions of both the screen and the
components, raised the question of whether the use of this standard
screening was the most efficient way to accomplish the functions.
Value alternatives were developed which diviated from the stand-
ard material in that they were based on using a solid material which
had been subjected to a standard perforating process (Figure 8-24).
The finding was that functions which cost 28 cents when the
standard wire mesh was used could be performed with the same
reliability by the perforated sheet metal at a cost of 18 cents.
EXAMPLE 5: DO not use inapplicable standard products
One million small eyelets were used in an electronic device. These
eyelets were made of brass and cost $1.75 per thousand. kamina-
tion of the required functions showed that, while the eyelet accom-
plished the functions reliably, all of the features of the eyelet were
not needed for this application. Discussions with eyelet manufactur-
ers revealed that, with a quantity of 1 million, the eyelet machines
could be adjusted and special runs made to provide special func-
tional eyelets for the purpose in question at 80 cents per thousand.
From hundreds of examples in which standards have been reviewed-
some used and some rejected-a few common criteria stand out for
standard materials, processes, products, parts of materials, parts of
processes, parts of products, etc. Knowledge of standards of all types is
the basic ingredient around which all deviations for the benefit of value
improvement must be organized.
If cost and applicability data have not been developed with regard to
the function required, the chances that the needed functions are being
accomplished at near their lowest practicable cost are decreased con-
siderably.
The matter of correctly selecting standards, nonstandards, or partial
standards in products, materials, or processes is similar to all other
phases of decision making. The principal task is one of first locating
sufficient applicable information and then making correct decisions
e e
Fig. 8-24 Shielding screens of

SCREEN PERFORATED -METAL wire mesh and perforated metal.
within the various shades of gray. This will result in sometimes using
standards, sometimes rejecting standards, and often using certain stand-
ardized functions but rejecting overall predigested standards.
Case Study
STANDARDIZE THE PACKING?
Although a range of sizes, stylings, and types of electric clocks were being
made to fit into the decor of each room of a house, it was recognized that
there existed a substantial market for a utility alarm clock. Therefore, one
clock was designed and marketed which included a minimum of cost for
producing aesthetic factors and features. It was a very successful product
and sold in large numbers. During a value audit on the clock, one of the
expense items investigated was the packaging. In line with techniques 7,
9, and 10, the best competence which could be found for this type of
package was invited into the job. One of these packaging specialists was
very enthusiastic and felt that he could provide a package with added
marketing benefits to protect the clock even better and to cost decidedly
less.
Two weeks passed and nothing more was heard from him. When con-
tacted by telephone he replied, "We stopped our study of that." When
asked why, he said that in his investigation he was confronted by a man
who had the assignment of promoting standardization. This individual
held that the packages now used on the whole line were a standardized
family of packages-all based on the same philosophy and with each
' deviating only as much as necessary to fit the individual clock. Therefore,
to develop an alternative would be a waste of time.
Nevertheless, the vendor yvas encouraged to develop the alternative in
line with his original plan, and this was done. The use of the suggested
new package for this one extremely high volume clock would reduce costs
$150,000 per year. With this full-blown value alternative in hand, the deci-
sion was promptly made to delete the particular item from the standard-
ized group in order to decrease costs and improve the package. Over-
standardization does not bring the best value.
8-13 Use the Criterion, "Would 1

Spend My Money This Way?"
It has been said that the system of value analysis concepts and tech-
niques is organized and illuminated common sense. Most certainly, any
successful individual in the competitive economy has learned to use com-
mon sense in applying the criterion, "Would I spend my money this
way?"
The average person, in evaluating his own expenditures, is governed
by the following typical conditions:
He has a limited amount to spend.

He strives to secure maximum use function and appearance function
from his expenditures.
He expects to get such functions within reasonable limits in return for
his expenditures. If that is not in view, he at once sets out to make ap-
propriate changes or, at least, to do so when he again is ready to expend
his funds.
He knows that he cannot get reasonable value in exchange for his
resources unless he has value alternatives clearly established and uses
corresponding information as criteria in decision making.
Before he spends his money, he will have clearly in view the relative
use values, the relative aesthetic values, and their relative costs.
The reader may recall for a moment that, in achieving value, it is vital
to do what makes the best sense. Any deviation from the answers that
make the best sense results in either diminished performance or de-
creased value. Diminished performance can usually be identified
promptly by tests. Decreased value, on the other hand, often remains
to be identified by buying resistance. Even then, cause and effect are
so separated that the particular answers which do not make good sense
are not necessarily in clear view.
Both motivation and direction are provided by the effective use of the
technique with which we are here concerned. Unless the answers by
design engineering, manufacturing engineering, purchasing, and man-
agement in all areas involved in decision making can affirmatively meet
the test, "If it were my money, would I spend it this way?" it should be
seriously questioned that a good degree of value exists. The application
and effect of this technique will become more understandable as it is seen
in a number of typical examples.
EXAMPLE 1: A 3-inch diameter hand wheel on a small valve cost
$3. Its function was to provide manual opening and closing of the
valve.
"If it were my money, would I spend $3 for the valve handle?"
With this motivation, manufacturers who produced handles for
valves were sought out. It was found that hand wheels of the same
size for the same function, specially cast and machined for this appli-
cation and made of the same material, could be provided for 60
cents each.
EXAMPLE 2 : A moderate quantity of heavy solid-steel trunnion
bolts (Figure 8-25), approximately 8 inches long with hex heads 3
inches across flats and with a bolt section 1%inches in diameter,
were needed. Round bar was purchased and the bolts were ma-
chined completely from it. The cost was $11each.
,---- -.
Fig. 8-25 Trunnion bolts,

BEFORE AFTER $11.00 to $2.28.
Does it appear to make sense to machine away all of this metal

and arrive at such a high cost? Although the manufacturing people
involved believed it was the only way that the bolt could be pro-
vided in this quantity, motivation from the question, "Would I spend
my money this way?" caused a further search.
As a result, a hot-upset bolt blank already containing the hex head
was found to be procurable, and the total cost of an interchangeable
trunnion bolt which accomplished the total function with the same
reliability became $2.28.
EXAMPLE 3: A hub and a shaft used in large quantity were
machined and then assembled together (Figure 8-26). In order to
provide reliable assembly, very close tolerances were held on that
part of the shaft which mated with the hub and that part of the
hub which mated with the shaft. The assembled cost was $1.12.
Value study of this item followed the line of questioning the wisdom
of being forced to provide close tolerances on two mating parts
because of their relationship to each other. After assembly, the
money paid for these close tolerances did not further contribute to
the operation of the overall device. Application of the technique of
BEFORE AFTER
Fig. 8-26 Hub-and-shaft assembly after change cost

about half.
asking, "Would I spend my money this way?" developed the convic-

tion that it simply did not make good sense. There must be a better
design philosophy.
Study of the function was followed by a study of alternative
methods of securing the function and also by a study of ways of con-
necting the two parts without the need for high-cost close tolerances.
The final result was a change in the design philosophy eliminating
the necessity of close tolerances. The hub was cast on the shaft, and
the finished part, machined, interchangeable, and ready for use, then
had a cost of 63 cents.
EXAMPLE 4: A small support clamp
On a high-volume product, a part 1/4 inch in diameter was supported
by a small clamp. As a consequence of technological advancement, a
part l/s inch in diameter was found to be capable of accomplishing
the total function with the same reliability and at a cost of $50,000
per year less than formerly. It was expected that the change would
be made at once.
Several weeks later it was noted that the %-inch diameter parts
were still being assembled which meant that the added cost of
$1,000 per week was continuing to be incurred. Personnel conduct-
ing the value study asked why the change had not been made. The
answer was that owing to the loading in the tool room a twenty-
week cycle was required for tool changes, since a $350 change would
have to be made in the dies to make the small supporting clamp.
When sufficient facts were laid before the decision-making men, the
condition which allowed an additional expenditure of $20,000 on the
product while waiting for the fabrication of $350 worth of special
tools was seen to be so contrary to "the way I would spend my own
money" that corrective action followed immediately.
EXAMPLE 5: Assembly of parts
It is normal for people to want to do things themselves. That is true
in engineering, in manufacturing, in purchasing, in management, and
in all other walks of business life. It is no surprise, therefore, to find
that manufacturing people believe they should do as much as possi-
ble themselves in manufacturing a product. They feel that they can
control quality and make improvements and can, in a variety of ways,
benefit their employers and their customers by doing so. This general
belief, like other general beliefs, produces decisions which, in specific
cases, keep large amounts of unnecessary costs in products. In the
present example, a group of parts was purchased from one supplier
and brought into the plant for assembly into a subcomponent. The
subcomponent was ultimately used in the overall product. The de-

livered cost of the parts was 86 cents. The labor, handling, overhead,
and inspection involved in testing added 49 cents, so that the factory
cost of the subcomponent was $1.35.
In studying the value of this assembly in terms of the technique in
question, the conviction was brought forth that it just did not make
sense to buy a number of separate parts, receive them, inspect them,
handle them, and reinspect them as an assembly which is then
stocked and ready for later use. It would seem to make sense to buy
one part, test one part, stock one part, and use one part when it is
needed. The answer to the question, "Would I spend my money this
way?" was negative.
The result was that an alternative proposal was developed with the
supplier, based upon his assembling the parts and providing a fin-
ished and tested subcomponent. This saved so much handling, pack-
aging, etc., in the supplier's plant that he was able to deliver the
complete assembly ready for use at 88 cents, which meant that 47
cents of unnecessary cost was identified and eliminated through the
motivation of this one technique.
EXAMPLE 6: Machine parts
For good and specific reasons, rules, regulations, and instructions
exist in every area. The instruction involved in the case of this ex-
ample was: "Prevent unnecessary inventory."
For a "one-shot" order, the buyer received a requisition to pur-
chase 5,000 screw-machined parts which would cost 10 cents each-
$500 in total. Being trained in value techniques, the buyer immedi-
ately developed alternatives and determined that the part could be
made also by the cold-upsetting and thread-rolling processes. The
minimum order quantity was 15,000 at a cost of $300, i.e., 2 cents
apiece.
This meant that the buyer was faced with the problem of either
ordering a 5,000 quantity as instructed at an additional cost of $200
or bringing in an unwanted inventory of 10,000 and, in the overall,
saving $200. His instructions were clear. However, his belief in the
application of the technique, "If it were my money, would I spend it
this way?" would not allow him to follow instructions, so he devel-
oped an alternative. He issued the order for 15,000 of the parts at
$300. He sent instruction to the receiving room that he was to be
notified when this order arrived. He planned to go out and personally
scrap 10,000 pieces on the spot. He reasoned that there would be no
inventory excesses and that his company would benefit by the $200
reduction in the purchase cost.
As so often happens where actions of human beings are involved,

an amusing occurrence took place. Here is what actually happened.
Somehow the buyer's letter to the receiving room was mislaid and he
was not notified as requested. As far as he was concerned, nothing
further happened in this connection until the end of the year when
he received the dismaying notification that he was charged with $600
worth of excess inventory on the part. Having correctly advised his
accounting department to charge the total $300 against the 5,000
parts used, it had booked the 5,000 quantity in at 6 cents each and
liquidated the total purchase price of $300 against the job. However,
when the 10,000 excess parts showed up at inventory time, account-
ing again used the 6 cents per piece cost figure, and thus the buyer
received the startling debit of $600.
EXAMPLE 7 : The I-cent check
Although the illustrations used in this text generally refer to products
and processes, the effectiveness of the techniques is in no way re-
stricted to those areas. The present technique is especially helpful in
many other connections. For example, an engineer who, during a
certain month, had taken out various cash advances and submitted
covering expense accounts and refunds unfortunately made an
arithmetic error and returned to the accounting department 1 cent
too much. In order to balance the books the accountants drew a
voucher on a New York City bank to pay the engineer back the
1 cent. The average cost of this procedure, according to an investiga-
tion with the management of the accounting unit, turned out to be
$5 per voucher because of a great deal of detail involved. Engineer-
ing and manufacturing people, often hard pressed to reduce over-
heads, were startled to find that a practice existed whereby so much
money was spent to disburse so little. The reaction of each was, "If
it were my money, I wouldn't spend it that way." The practice of
incurring $5 of expense in order to pay 1 cent, or for that matter
to pay $1, was brought into the open for very serious questioning
by application of the technique.
The present-day endeavor to establish systems which, almost regard-
less of people, will produce good results is certainly a most worthwhile
trend. No matter how well a system is planned to take care of certain
situations, there still remains room for the individual-thinking clearly-
to make considerable contribution toward improvement. It is for that
reason that the present technique is included in value analysis. Unless it
is used and used effectively, experience in practical life shows that large
amounts of identifiable unnecessary cost remain unidentified.
SUMMARY
Although the basic problem-setting and problem-solving system is ap-
plicable to any type of problem, the results accelerators in this chapter
are quite specific to the task of locating and making it practical to pre-
vent or remove "unworking" elements of cost.
This is a pragmatic chapter. Every item in it arose from the need, in
situations where it becomes essential, to get better than normal cost re-
sults while maintaining high-grade performance.
To be unusually effective the user must:
Always end generalities-get into specifics.
Get and understand the makeup of pertinent costs-often very difficult
to accomplish.
Get and use information only from the best source in every situation.
Give no credence to any other.
Mentally blast the situation-tear it apart. Mentally build anew.
Mentally refine-minimize disadvantages.
Use real creativity. Bring the new and better solutions into mind, with-
out waiting to see them on a competitor's product or process.
Learn to identify stoppers or roadblocks for what they are. Deal with
them effectively. Do not allow them to stop progress or to prevent
results.
Help industry specialists to know the exact functional need and offer
their assistance.
Relate exact costs to the causes of various increments of cost, and then
relate the exact function produced by those increments of cost to the
amount of the cost.
The best search for ready-made solutions to problems that face the
product or process designer uncovers only a part of the available "off-
the-shelf" help. Confront the suppliers with the functional needs, and
help them secure a good hearing and apply their products, processes,
standards, skills, and knowledge to the needs of this job.
New and better solutions are more readily created when the persons
involved believe or "feel" that the present answers certainly are not
optimum and hence, in analysis thinking, develop a feeling of "What
I think and how I feel" about the cost in relation to the function being
accomplished.

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8-1 Avoid Generalities

All too frequently a good idea or proposition is swept aside by a good-

6. "We've made a thorough study of every conceivable way of doing

Parts may vary in complexity.

For one application, forty thousand Y4 x %inch screws were required. It

In each area of activity, habits and accustomed practices prevail. Specific

8-2 Get All Available Costs

Fixed overhead Manufacturing cost

the business results will be affected negatively by taking advantage of

How will sales be affected?

known, as are material costs. Furthermore, it is known precisely how

25 50 75 100 125 150

UTILIZATION AT THE SPECIFIC TIME

EXAMPLE 5 : Decision cost involving make one way versus make

another way in the factory.

Word was received that severe customer resistance had developed to

8-3 Use Information from Only

A special instrument required a glass cover, about 10 inches in diameter,

of part." Drawings and specifications were sent to some of these suppliers,

8-4 Blast, Create, Refine

To blast a steel screw, it seems reasonable to compare it first with steel

use of the "blast" portion of this technique; in others, expertness in use

Fig. 8-2 Copper tubing.

Fig. 8-3 Clamp bar. Fig. 8-4 Clamp bar:

EXAMPLE 2: The clamp bar shown in Figure 8-3 is made of steel,

Refine. Particular complications or problems to be solved in each

Fig. 8-5 A small Fig. 8-6 A radio-fre-

Fig. 8-7 Radar-control mounting.

EXAMPLE 4: In military equipment of the radar type, it is often

assembly cost $127. The potentiometers which accomplished the

Electromechanical controllers, approximately 1 x 1 x 2 feet in size, were

operation was said to be required so that the assembly would immediately

8-5 Use Real Creativity

ders. In the competitive atmosphere of such sessions, one individual's

to someone's inquisitively asking himself, "Wonder what use I could

8-6 Identify and Overcome Roadblocks

T h e fact remains that this "belief," until corrected, was just as

EXAMPLE 4: "Underwriters' wouldn't approve it." A very simple

This specific technique of identifying and overcoming roadblocks is

An electronic control contained twelve binding screws. The function of

the application, and it subsequently approved a screw which cost $2 per

8-7 Use Industry Specialists to Extend

known penetration of any technology as 100 per cent, what depth of

Scarcity of stainless steel and innovation in attractive anodized finishes for

EXAMPLE 1: Heat-transfer enclosure. A complicated metallic en-

EXAMPLE 2: The linkage. As today's products become more and

EXAMPLE 3: Gyros. In a military product in which weight was

8-8 Get a Dollar Sign o n

Variations of raw material in past years made it "seem" necessary.

Regrouped as follows, these objectives become more readily applicable

Yearly total part cost

We now rearrange these costs. For example:

Finish cylinder $6,000

Our study then proceeds along these lines:

Yearly cost of parts

Proceeding with an analysis, a natural first question is: Why does

Length, *0.002 in. $40,000

This clearly and appropriately directs attention to the tolerance which