The research paper published by IJSER journal is about COMPREHENSIVE STUDY OF COST CUTTING STRATEGY & IMPLIMENTATION IN INDUSTRY 1
ISSN 2229-5518
Vishal Anand
M.Tech Research Scholar, SBCET, RTU, Jaipur, Rajasthan, India vishu11sep@gmail.com
Abstract- In my thesis I worked on the cost reduction practice applied in an Indus try. The applied tool in the thesis is “Value Engineering”. According to value engineering the value of a product can be increased by reducing the cost of the product or by increasing the functionality of the product. I have selected an automotive company which manufactures headlamps for several reputed companies. I applied value engineering tool for the cost reduction in this industry by changing the material of a part (Adopter) of the headlamp. Adopter is used to hold the main bulb in the c orrect position. It was initially made up of Aluminum which costs Rs 20; I have changed this material with the Sheet Metal which costs Rs. 15. Not only this ha s the sheet metal adopter fulfilled all the necessary conditions which are expected from an adopter for the s atisfactory fulfillment of the job.
Index Terms— VE-Value Engineering, FA-Functional Analysis, FE-Functional Evaluation, VA-Value Analysis, CW- Creativety Worksheet, FAW- Functional Analysis Worksheet & FD-Functional Development.
1 INTRODUCTION
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The focus of my project is towards the Value Engineering. The value engineering acts as a tool to reduce the cost of a product. The application of value engineering is very much wide in the industries as in the competitive market cost reduction is the prime factor. Hence every industry in pre- sent scenario is applying their expertise to reduce the cost of the product.
Before understanding about value engineering it is im- portant to understand that what is value and how value engineering plays its role in an industry.
Value= Function of the product/ cost
Value is dependent upon two parameters i.e. functionality of the product & cost of manufacturing. If we want to in- crease the value of a product; then it is necessary to in- crease the function of the part or by decrease the cost of the product. [4]
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Vishal Anand, Research Scholar, M.Tech (Production Engg.), Sri Balaji College of Engineering & Technology ( SBCET), Rajasthan Technical Uni- versity, Kota, India, Mobile No.-+919783564436, E-mail-
Guided by: Mr. Jai Prakash Bhamniya, Asst. Prof. SBCET, Jaipur, Raja- sthan, Mob. No.-+919660024253, E-mail-jaibhamniya@gmail.com.
Management recognizes Value Engineering but also recog- nizes its organizational limitations as a product line reaps the upfront Value Engineering savings and then struggles Engineering and purchasing department have current ac- tivities underway using Value Engineering workshops as a means of creating less costly products while proving the same or better function. One company reported that Value Engineering was dead due to company management’s short term outlook of making profit. The company has al- ways treated VE as a self-sufficient cost center harder every year to justify the future cost savings through Value Engi- neering for the same programs & parts in future. [1]
1.1 Thesis Outline
In my thesis I have worked in an industry dealing with the automobile head lamps & tail lamps. Here my focus is on the reduction of the cost of head lamps and by the virtue of Value Engineering. I have been able to reduce the cost of the head lamp by some amount.
Model has been prepared for deciding the parameters on which the cost reducing practice can be performed. This model helps in successfully accomplishing the test to get the desired output. The industry is a medium scale indus- try and deals with different automobile companies for the head & tail lamps
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The research paper published by IJSER journal is about COMPREHENSIVE STUDY OF COST CUTTING STRATEGY & IMPLIMENTATION IN INDUSTRY 2
ISSN 2229-5518
In this thesis I have chosen an automotive company which deals with the manufacturing of Head Lamps of most of the prestigious two-wheeler & four-wheeler companies.
The purpose of my thesis is to reduce the manufacturing cost of the Head lamp of any four-wheeler chosen. To start this cost reduction method I have chosen “Value Engineer- ing” as a tool. [5]
Value Engineering is applied to the Head lamp. The steps used for this purpose are as follows:-
A. Functional Analysis Worksheet is prepared for the dif- ferent parts of the product.
B. Functional Evaluation is done for each part.
C. Creativity Worksheet.
D. Selection of alternative is done. E. Finding and Recommendation. F. Conclusion.[2]
Above steps are selected for the cost optimization of the headlamp, these steps will help me in creating the structure of the experiment. Following structure starts with the Func- tional Analysis which deals with the description of the each component used in the headlamp. The next step is Func- tional Evaluation in which the cost of each component is estimated. [7]
Numerical evaluation is prepared on the basis of graph plotted between the components and the cost of them. This helps in identifying the cost difference among each other. This gives the idea to select the part to be replaced by other material.
Creativity worksheet deals with the methods can be ap- plied in the present condition for the cost reduction. It helps in the proper selection of the direction in which the thesis work can be progress. This step is followed by find- ing and recommendation. Finally, the conclusion will be provided regarding the experiment done. [6]
Table 2.1 Functional Analysis worksheet
Table 2.2 Functional Evaluation
SN | Qt | Part name | Function | ||
Description | Verb | Noun | |||
1 | 1 | Reflector | Reflects | Beam | |
2 | 1 | Glass Lens | Converge | Beam | |
3 | 1 | Adopter | Holds | Bulb | |
4 | 1 | Parking Bulb | Blinks | Parking light | |
5 | 1 | Shadow Cap | Reflection control | Beam | |
6 | 1 | Rubber Cap | Grips | Lens & Reflector | |
7 | 1 | Main Bulb | Glows | Beam | |
8 | 1 | Clamping Wire | Clamps | Main Bulb |
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The research paper published by IJSER journal is about COMPREHENSIVE STUDY OF COST CUTTING STRATEGY & IMPLIMENTATION IN INDUSTRY 3
ISSN 2229-5518
cost reduction but if we select the plastic material then it will help us in the cost reduction by changing the material of Re- flector. But, after selection of an alternative we have to check the feasibility of its application by performing various tests on it.
The following parts have been found costly from the Func- tion Cost Evaluation.
1. Reflector.
2. Glass Lens
3. Adopter.
a) Thickness reduction of the sheet metal used in reflector.
b) Changing the material of reflector from sheet metal to some other cheaper material.
c) Changing the material of Adopter from Aluminum to some other cheaper material.
d) Elimination of the least important component .i.e. Shadow
Cap.
e) Compounding of the Rubber Gasket. Rubber gasket is made an integral part of the headlamp assembly.
Now, it is required to review all the above possibilities of cost reduction.
Changing the material of reflector from sheet metal
(iron base) to some other cheaper material.
Alternative materials:
a) Change it to Plastic material (Polystyrene). b) Change it to Iron- copper base alloys.
c) Change it to Composite material (composed of
Sheet metal & carbon fiber).
Table 2.3 Functional Development of Reflector.
a) Vibration Test.
b) Photomatic Test.
c) Reflector Peel-off Test.
Table 2.4 Vibration Test Report of Plastic Material
Parameters | Test Report | Remark |
1 | Frequency 10-55-10 Hz | OK( )/ NOT OK(*) |
2 | Duration 3-6 Hrs. | OK( )/ NOT OK(*) |
3 | Amplitude 1.5mm. | OK( )/ NOT OK(*) |
4 | Axis of Vibration (X- Y-Z) 1 min at each axis. | OK( )/ NOT OK(*) |
. Material defects found. . Lens or reflector rotation. .Displacement or rupture of parts. | Y/N (Y ) Y/N (Y ) Y/N (N ) |
From the above test we find that the plastic material used for reflector fails to sustain in the Vibration test. Hence, we are stopping our experiment and we are not going for Photomatic test and Reflector Peel- off test.
Table 2.5 Functional Development of Adopter
From above cost estimation we find that the original cost of the product was Rs. 29.5 and the two alternate has not significant
IJSER © 2012
The research paper published by IJSER journal is about COMPREHENSIVE STUDY OF COST CUTTING STRATEGY & IMPLIMENTATION IN INDUSTRY 4
ISSN 2229-5518
Table 2.7 Vibration Test Report of Sheet-Metal
From the above table we have three alternatives and from the price point of view it is cheaper to select Plastic (Poly- styrene) as a material for Adopter. Although, the composite materials can also be used for cost reduction but we would not find the expected cost reduction.
Table 2.6 Vibration Test Report of Composite Material
Table 2.8 Photomatic Test of headlamp using Sheet-Metal Adopter
Parameters | Test report | Remarks |
1 | Distance -25 meters | OK(* )/ NOT OK( ) |
2 | Cut- off angle-150 | OK(* )/ NOT OK ( ) |
. Object at 25m visualize easily. . Cut-off is perfect. | Y(* ) / N ( ) Y(* ) / N ( ) |
Unfortunately Thermosetting Plastic don’t pass the vibra- tion test, hence we are compel to select the next alternative i.e. Sheet Metal, but to finalize the selected material i.e. Sheet Metal (iron base) as Adopter it will have to pass sev- eral test as discussed in the previous sections.
a) Vibration Test
b) Photomatic Test.
c) Reflector Peel-off Test.
Table 2.9 Reflector Peel-off Test
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The research paper published by IJSER journal is about COMPREHENSIVE STUDY OF COST CUTTING STRATEGY & IMPLIMENTATION IN INDUSTRY 5
ISSN 2229-5518
Fortunately, this time this material has passed the entire test required for comfortable use as the Adopter. Hence, according to the test conducted we are replacing the Adopter material from Aluminum to Sheet Metal. This will save about Rs 5 for each Adopter.
I got the result that by applying all the available alternatives Sheet- metal is the most suitable material used as an adopter, which can successfully reduced the raw material cost.
Sheet-metal as an alternative material for adopter in place of Aluminum we can save upto Rs. 5 for each adopter as an inventory cost.
According to the Functional Evaluation sheet we have es- timated the cost of the headlamp is about Rs. 123.10, this cost is the inventory cost of the entire component used in the headlamp. When the Adopter material is replaced from Aluminum to Sheet-metal, then it is found that the total cost of the product will be reduced up to Rs. 5 i.e. we are successfully reduced the inventory cost of the headlamp from Rs 123.10 to Rs. 118.10.
The sheet-metal not only fulfills the cost related issues but also finds suitable in other parameters also. This follows the various test based on the various application in the working condition. This is provided by the Vibration test, Photomatic test and the reflector peel off test carried on the whole assembly.
5. FUTURE REFERENCES
Adopter is made up of Aluminum which has been success- fully replaced by the sheet-metal, which saves Rs. 5 per adopter. The sheet-metal fulfills all the desired properties which an Adopter needs. The cost of the headlamp can fur- ther be reduced by searching other alternatives for the adopters. The cost can also be reduced by changing the ma- terial of the Reflector from the cheaper alternative.
6. ACKNOWLEDGMENTS
I am so graceful to publish this paper in IJSER which will justi- fy my original work of thesis. I have been inspired by my guide Mr. Jai Prakash Bhamniya, Asst. Prof , SBCET, Jaipur, Rajasthan. He guided me a lot and helped me in the publica- tion of this paper.
7. REFERENCES
[1] Aminzadeha. Rahim; Ismailb Amirruddin; Arshad Ishak (2011) “De- velopment Value Engineering Modeling in Construction Transportation” Published in Australian Journal of Basic and Applied Sciences, 5(12): Page no. 397-402.
[2] Chao Fang Lin; Shieh Chien-Ming ; Lai Chi Chang “Value Engineering
in Product Renovation Page no. 1-7.
[3] Chung Boo Young; Syachrani Syadaruddin; Jeong Hyung Seok (2009) “Applying Process Simulation Technique to Value Engineering Model: A Case Study of Hospital Building Project” by Published in IEEE Transa c- tions on Engineering Management, Vol. 56, No. 3.
[4] Gershenson John K (2009). “Application of Value Engineering Tech- niques in Curriculum Development and Review” by, vol. 18, Page no. 140 -
150.
[5] Jariri F;Zegordi S.H. (2008) “Quality Function Deployment, Value En- gineering and Target Costing, an Integrated Framework in Design Cost Management: A Mathematical Programming. Approach” by vol. 15 vo. 3, Page no. 1-7.
[6] Sharma Amit; Srivastava Harshit “A case study analysis through the implementation of Value Engineering” by. Published in International Journal of Engineering Science and Technology (IJEST): Page no. 1-10.
[7] Stringer Richard A. “Value Engineering A Nation- South Africa: A case study by: Page no. 6
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