6. May 2020
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Category Archives: Consulting
Happy clients at minimal costs
In a recent study, FEV Consulting demonstrates successful approaches to effective cost and value engineering (C&VE)
In a recent study, FEV Consulting demonstrates successful approaches to effective cost and value engineering (C&VE)
How is the concept of cost and value engineering (C&VE) currently incorporated into companies with a focus on engineering, and what level of maturity has it reached? What strategic goals are pursued with C&VE, and what benefit does it have? What are the key factors for the success and effectiveness of C&VE? What does a best-practice organization look like? Answers to these questions and more can be found in the market study recently conducted by FEV Consulting.
Pressure from global competition is rising, and customers are demanding lower and lower prices. Satisfying customers‘ requests quickly and affordably without sacrificing quality requires interdisciplinary cost and value engineering (C&VE).
FEV Consulting‘s smart cost reduction advisory approach combines eight service modules to achieve best-cost solutions for technical products. Our interdisciplinary team of experts, consisting of FEV engineers, production specialists, costing specialists, and purchasing experts, can help you cut costs by between 15% and 25%. A recent study by FEV Consulting shows companies use different organizational forms for C&VE. Thus far, there is no discernible procedure or recommendation for building a C&VE team.
Strategy and objectives
• Of the companies surveyed, 75% have either not established a comprehensive C&VE system, or they have none at all.
• A full 78% of respondents have had positive experiences with C&VE methods and have managed to lower their costs.
• More than 60% of companies do not integrate C&VE early enough in their product engineering process (PEP).
• A whopping 94% of respondents are heavily or very heavily affected by increasing cost pressure.
Organization
The majority of companies surveyed that have a C&VE system, or are in the process of establishing one, have placed their central C&VE organization within their purchasing or development departments, and 70% of the companies we asked use C&VE methods worldwide across every major subsidiaries or all subsidiary companies. External partners are closely involved in the design and development phases. The main challenges in C&VE are poor data quality, insufficient resources, and low acceptance among the operations departments.
Processes
Companies that have implemented C&VE are applying these methods more and more often during the early phases of the development process. Moreover, they are seeing costs come down during series production. Lower costs, target costing, and redesign activities are the primary tasks of C&VE, with the most important interfaces being research & development, procurement & purchasing, and production.
Methods and tools
Target costing and design to cost are by far the main methods used in C&VE. Others include cost structure analysis, should-cost analysis, and benchmarking of competitors‘ products. Approximately 75% of respondents use SIEMENS PLM or FACTON EPC as their costing software.
Main features of a best-practice organization
A best-practice organization incorporates C&VE throughout the company and product life cycle. Top management supports C&VE. Also, customers‘ requirements have been clearly laid out and the target costs clearly defined. The C&VE team is organized as a centralized and interdisciplinary group of experts with strict integration in all development projects. C&VE is made part of the PEP early on, and a life cycle cost management system has been set up. Standardized software applications aid in continuous cost monitoring. Uniform methods and a tool box ensure professional standards are met. Target costing and design to cost serve as the leading methods for realization of optimum products.
FEV Consulting: smart cost reduction
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Cost-effective development - through outsourcing and virtualization
How FEV Consulting can help OEMs achieve product maturity faster
How FEV Consulting can help OEMs achieve product maturity faster
The success or failure of technological innovations largely depends on the development processes behind them and how they are integrated into and implemented within a company‘s organization. That is where FEV Consulting comes in. We help clients by tapping into our collective internal experience in the field of product development and by leveraging our direct and unique access to the capacities of the FEV Group. At the same time, we take into account our clients‘ specific requirements, as well as the three core elements of successful product development: quality, cost, and time.
In light of rising pressure on an OEM‘s product development efforts, FEV Consulting sees three areas where they can act: outsourcing, virtualization, and increasing efficiency.
Strategic outsourcing of development work packages
Customers now expect ever more diversified products to be put on the market faster. That leaves OEMs with little time for development and bringing the products to maturity. At the same time, there is increasing cost pressure. So, it becomes more important to outsource key development work packages. To help its clients overcome these challenges, FEV Consulting offers a structured Engineering Services Outsourcing (ESO) approach. Our experts analyze the client‘s R&D network, evaluating to what extent development packages can be farmed out, and then devising a corresponding plan for implementation.
Active outsourcing offers concrete benefits. First, external service providers can alleviate temporary shortages of capacity and skills. Second, companies are able to lower their fixed R&D costs and focus development activities on their core competencies.
The results are usually a leaner and shorter development process and quicker introduction to the market.
Optimization through virtual powertrain development
Whenever OEMs incorporate virtual methods heavily into the early phase of product development, they save themselves the trouble of expensive prototype testing and reach the desired product maturity faster and more economically.
FEV Consulting helps its clients assess their skills, working methods, and computer-aided engineering (CAE) infrastructure. Our experts examine the client‘s organization and processes, its data and knowledge management, or its human resources capacity and skills. Through the unique collaboration between FEV Consulting and the CAE experts from the FEV Group, clients receive total support at both the expert and management levels. This results in solutions for the sustainable implementation of tools, methods, and approaches to simulation.
Strategies for efficient powertrain testing
An integral part of powertrain development is verifying product functions and durability. The tests generally take time, tie up test bench resources, and require the use of prototype components. In addition, future legal requirements (e.g., Real Driving Emissions, RDE) will force testing facilities to acquire costly testing equipment. By concentrating more and more on virtual development and new testing strategies (e.g., from road to rig to desktop), companies are spending less time and effort on testing.
Before discussing measures for the improvement of existing testing facilities, the FEV experts come up with possible future scenarios. With the aid of a proprietary simulation tool, they assess the scope of work and necessary test bench capacity. Then FEV recommends test facility strategies with which clients can save money and be well-positioned for the future.
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