08 Value Engineering

Session Objectives

• Apply Value Engineering principles to technology design.

• Analyze the functions of the prototype vs. its cost.

• Optimize materials and processes to reduce costs without sacrificing quality.

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🧠 Theoretical Content

1. What is Value Engineering (VE)?

Value Engineering is a systematic method to improve the "value" of goods or products and services by examining their function.

• Value = Function / Cost

• You can increase Value by improving the Function or reducing the Cost.

$$Value = \frac{Function}{Cost}$$

2. Functional Analysis (FAST Diagram)

The Function Analysis System Technique (FAST) asks "How?" and "Why?" for every component of your technology.

If a component costs $100 but does not directly support the primary function (the "Why"), it must be redesign or eliminated.

3. Cost Optimization Strategies

• Component Standardization: Using standard off-the-shelf parts (like an ESP32 instead of a custom PCB) during prototyping.

• Software vs. Hardware: Can a physical button ($2) be replaced by a software interface on a touchscreen ($0 marginal cost)?

• Open Source Leverage: Using Python libraries instead of paying for licensed analytical software.

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🛠️ Class Activity: Technology Unit Cost Analysis

Goal: Calculate and optimize the Bill of Materials (BOM) or Software Stack cost for your MVP.

1

Current Cost Calculation

List every expected component (sensors, cloud servers API calls, motors, 3D printing filament).

2

Function Mapping

What specific function does each cost line item serve?

3

Value Optimization

Identify the top 2 most expensive items. Force your team to brainstorm a cheaper alternative for those items without altering the core function.

Item	Cost	Function	Alternative	Reduced Cost
Cloud Database (AWS DB)	$50/mo	Store data	Local SQLite / Free Tier Cloud	$0
Metal Enclosure	$30	Protect circuits	3D Printed PETG	$5

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📚 Assignments

• Refine the BOM: Finalize your optimized Bill of Materials.

• Sprint Continuation: Proceed with the physical/digital construction of the prototype using the selected and optimized components.