First of all I have to excuse that there was no new articles posted for the last view months. Corona did also impact us and home schooling, parallel work etc. did impact us as well and there was almost no time for any other activities. Now, as the situation has relaxed, you can expect again some insights in modern procurement engineering and cost / value engineering approaches.
Today I want to share some thoughts why „product disassembly“ is an important lever in the design to value process and how you can use it to generate a competitive advantage. So, why should you do product disassembly?
Introduction to Product Cost Management
A company’s health and longevity are linked to how well it can sustain and grow its profits over time. From a simplified perspective, the company can achieve this longevity by (1) increasing its revenue, and/or (2) improving its profit margin. This six-part-series focuses on the later: improving profit margins via successful product cost management during an R&D project. The series includes the following sections:
- Set the Tone Early. Check Back with the Market Often.
- Create Transparency
- Teach & Empower
- Align Key Cost Decisions with Program Schedule
- Execute. And Document the Decision Logic.
flow in chronological order, although it is important to know that many of
these steps are only effective when they are sustained in parallel throughout
the entire project timeline. This will become more clear as we progress through
the sections together.
We’re now working on procurement-engineering.com more than one year. Looking back and reviewing everything shows that we really have put together a nice overview of the most important things in Procurement Engineering. You will not find a better crisp overview. See and find out …
Cost and Value Engineering
Procurement Engineeing is well connected with Cost and Value Engineering. Many Posts deal with the interface between CVE and PE:
Cost Engineer vs. Procurement Engineer Link
Once in a live most of the car owners need to buy wheels for his car. The question is: Which price is reasonable for the product? Which kind of wheels to choose? In this article you will find answers on that question. Additionally, you get an overview about a cost structure of an aluminum casting product using bottom up cost calculation method. We think it’s a perfect example to show how cost value engineering contributes to the company’s success and could also help you in your private life.
We talk about “Design to Value” and “Design to Cost” how to run related projects, but before we start to talk about the methods how to lever “Design to Value” (DtV) we have to understand what “Design to Value” means. Basically, DtV means a design approach for new products or systems where the maximization of the value for the customer is the determinant target. In a broader sense, DtV extends the Design to Cost approach by further methods and approaches. Every design feature or design concept is therefore measured whether or how much value it creates for the customer or not.
What is the difference between Procurement and Cost Engineers and is it worth to have both in the team setup? This will be very roughly discussed by using an example and providing a guideline when this might make sense for a company. As always there is no simple answer. Some facts might help to make the decision: size of company; size of commodity, complexity of commodity & skill set of procurement engineers. Fact is that both roles (should) have at least 50% overlap in their expertise.
I expect that you as a reader of that blog are working in an environment where you either are running a Procurement Engineering Organization or you are interested in that topic because you want to build up such an Organization. In both cases there are job interviews are waiting for you and the following overview with some questions might help you.
These questions have been extensively used in various interviews and helped us to identify whether the candidate was or is the right one. Beside the focus on Procurement Engineering I would always recommend preparing a list of questions you want to ask as a kind of checklist to ensure that you ask the different candidates the same. Make notes during the interview. So more details you have so better. At the end of the interview make a summary. After you had all the interviews, sit down and review all interviews with your written notes. This prevents that you automatically select one of the last candidates as they are more present in your memory. I added to every question some background information why you should ask exactly this question and what is the expectation.
First guess probably everyone has when he think about procurement engineering is cost saving for OEM/customer. Sure, this is not the only value for the customer there are some more. But one advantage might not be present immediately. The benefit for the supplier!
In the course of my different positions within procurement pretty often people asked what is actually the difference between a Procurement Engineer and a Cost (Value) Engineer. Why Value in brackets? Cost Engineer is more common, but in some organizations the position of a Cost Engineer is also designated as Cost Value Engineer. Where does the confusion come from?