functional analysis - A technique to reduce costs
Function Analysis is the process of associating cost with each function of the product, as well as
analyzing the value of each of those functions to the final customer. The objective is to draw attention away from the cost of each component and focus on the cost of each function of the product compared to that function’s value.
A function answers the question "what is the task to be done"? Even though a product would seem to have one main function, it can be broken down into several basic functions required to achieve the main function. For example, a coffee machine has the following functions: store water, heat water, brew coffee, store coffee, and keep coffee warm.
If a function is important, alternate solutions can be determined to meet the same, or better, performance at a lower cost. If a function is not that important, its cost should reflect its low value. The intent of this method is to
increase the value of the product for the customer while reducing the cost. A high-value-over-cost ratio is preferred and a lower-value-over-cost ratio reflects an over-achieved function.
Reduce your costs, and improve the value of your products by listing and fully understanding the required performances of each function. What is the current performance and what is the target to achieve? Are you over-designing a function that has low value, or is the performance target high enough for high value functions? The cost over value ratio chart can help identify those opportunities.
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Example: a coffee machine |
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 | On this chart we can see that some functions add more value to the final product for a lower cost.The function "brew coffee" is very important to the customer while its cost is the lowest of all functions. In this case, we want to take advantage of the high value of the function for a low cost. For every dollar spent on the function, the customer will see added value. It can be developed and improved which will greatly improve the value of the final product at a low cost.On the other hand, the function "keep coffee warm" is one of the most expensive functions while its value is the lowest. This function should be reduced to the minimum required or eliminated since its cost is high and its value low. |
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Performances of Functions from Coffee Maker Example"Store water": the current performances of this function are better than what is required (100 oz vs 88oz). This can be due to using an existing component, or not previously understanding the exact requirements for the function to work properly. Using a 88 oz water tank can be an opportunity for cost reduction.
"Heat water": this analysis highlights here that in some cases the relationship between the specifications and the technical solution is not always fully understood as the specifications and the actual performance are expressed with different units. Here, comparing the 300W heater to the specifications of heating 12 oz of water to 100 deg C in 30 seconds shows that the heater is more powerful than required (heats the water in 25 seconds). Using a lower power heater could be an opportunity for cost reduction.
"Store ground coffee": the performances correspond to the requirements, no change required.
"Brew coffee": here we see that the product is not performing as well as it should. The requirement is to brew 10 cups in 5 minutes but the current performance is 10 cups in 6 minutes. Since the value of the function is high (value shown in table: 10), improving this performance would increase the value of the product to the customer.
"Store brewed coffee": we see that the product is not performing as well as it should. The actual storage capacity is 9 cups instead of the 10 cup requirement. Since the value of the function shown in the table is 7, improving this performance should improve the value of the product to the customer.
"Keep coffee warm": this is another example where the specifications and the actual performance are expressed with different units which is common in the design process. The difficulty is to convert them to comparable units to evaluate the potential for performance optimization and cost reduction. Computing the power required to keep 10 cups of coffee at 80 deg C will provide a direct comparison with the 50W heating pad used. If the requirement is 60W, the function requirement is not met. However, the low value of the function (value: 5) should be taken into account. It might not be worth spending too much money on this function. If the requirement is 40W, the current performance is higher than required and could present a cost reduction opportunity.
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