DESIGN  TO  COST  WORKSHOP

DRM Associates

© 2006 DRM Associates

1. INTRODUCTION

• Effect of Product Development on Cost
• Traditional Approach to Product Cost Management
• Target Cost Approach & Comparison
• Design to Cost (DTC) as a Basis to Achieve a Target Cost
• A Comprehensive Approach to DTC Achievement During the Five Development Phases:
  • Requirements Definition
  • Concept Development
  • Assembly Design
  • Part Design/Selection
  • Process Design

2. PRODUCT ECONOMICS

• Economics of Product Development
• Relationship of Product Costs, Development Costs & Volume
• Elements of Costs and Life Cycle Costs (LCC)
• Nonrecurring Development Costs and Recurring Production Costs
• Tradeoff's Between Recurring & Nonrecurring Costs  
• Obtaining & Using Manufacturing and Supplier Cost Data
• Experience Curves
• Exercise - New Product Business Case

3. DEVELOPING A DESIGN TO COST OBJECTIVE & TRACKING COSTS

• Determining a Target Cost/Design to Cost Objective From the Target Price
  • Determining Supply Chain Margins, Distribution Costs, Warranty Costs, Corporate Allocations & Profit
  • Target Cost Worksheet & Example
• Allocating & Tracking Target Costs/Design to Cost Objectives
• Using Product Cost Models and Cost Tables to Track Target Costs/Design to Cost Achievement
• Basic Product Cost Models - BOM Cost Roll-ups and Spreadsheets
• Creating and Refining a Predictive Cost Model
• Commercial Cost Model Tools
• Validating Cost Projections
• Cost Tracking and Performance Monitoring
• Target Cost Tracking Worksheet
• Life Cycle Cost Costs & Cost Models

4. DTC DURING REQUIREMENTS DEFINITION

• Requirements are the Ultimate Cost Driver
• Start with the Customer Value Proposition
• Conjoint Analysis - Determine What is of Value to the Customer
• Focus on Customer Needs - Functionality vs. Affordability
  • Using Quality Function Deployment to Balance Requirements and Cost
  • Using Quality Function Deployment to Understand Cost Drivers
  • Using Quality Function Deployment to Balance Specification Values and Cost
• Customer Function Diagram to Abstract Requirements and Assess Completeness
• Evaluating Requirements Based on High Cost to Function Ratio

5. DTC DURING CONCEPT DEVELOPMENT

• Use of Function Analysis to Explore Concept Requirements and Reduce Costs
• Value Engineering & the Function Analysis/Value Analysis Methodology
  • Function Analysis Exercise I 
  • Function Cost Matrix & Value Analysis Matrix
  • Function Analysis System Technique (FAST)
  • Function Analysis Exercise II
• Importance of Exploring Concept Alternatives
• Brainstorming and Other Creativity Techniques
• TRIZ and Theory of Inventive Problem Solving
• Trimming and Simplification
• Concept Evaluation and Concept Selection Matrix
• Simplification and the Impact of Architecture on DTC

6. DTC DURING ASSEMBLY DESIGN

• Function Analysis with Assembly Design
• The Power of Considering Assembly Design Alternatives
• Design for Assembly (DFA)
  • DFA Principles & Guidelines
  • The Key DFA Principle - Simplification
  • DFA Exercise I 
  • Avoiding Non-Recurring Costs with Standardization
  • Mistake-Proofing Assembly
  • Assembly Process and DFA Principles
    • Handling and Orientation
    • Location a ndInsertion
    • Joining and Fastening
    • Adjustment & Finishing
  • DFA Exercise II 
• Design for Test - Developing an Economic Test Strategy

7. DTC DURING PART DESIGN/SELECTION

• Function Analysis with Part Design
• Evaluating Material and Process Alternatives
• Trade-offs of Nonrecurring and Recurring Costs with Tooling Near Net Shape Parts
• Standardization and Simplification
• Design for Manufacturability (DFM)
  • Evaluating Material and Process Alternatives
  • Production Rate & Cost Trade-off's: Materials, Manufacturing & Tooling
  • DFM Principles & Guidelines - Machining, Sheetmetal, Injection Molding & PWB's
  • DFM Exercise
• Reducing Costs with Early Supplier Involvement & Effective Supplier Partnership
• Purchasing Actions to Reduce Cost
• Minimizing Supply Chain and Logistics Costs

6. DTC DURING PROCESS DESIGN

• Principles of Process Design for Low Cost
• The Role of Value Engineering in Process Design & Improvement
• Cost Reduction through Automation and Integration
• Re-engineering the Development and Production Processes
• Eliminating Non-Value-Added Activities
• Minimizing Cost Through Maximizing Process Capability
• • Centering the Mean and Establishing Realistic Tolerances
  • A Minimum Cost Strategy Cost Inspection & Test
• Optimizing Tolerances for Low Cost

7. ACHIEVING DESIGN TO COST

• Challenging Your Assumptions
• DTC Exercise
• Achieving DTC - Summary by Development Phase

8. DTC PROCESS AND ORGANIZATION

• Establishing a Design to Cost Program
• The Design-to-Cost and DFM/A Process
• Design Reviews
• Avoiding Local Optimization and Global Suboptimization - Organizational Issues
• Use of Product Development Teams to Achieve Cost Targets
• Roles and Responsibilities
• Supplier Roles in Design to Cost
• Essential Metrics to Track Target Cost Achievement

9. IMPLEMENTATION & SUMMARY

• The 10 Steps to Design-to-Cost
• Deploying a Design to Cost Program to Your Business/Project
• Overcoming Impediments and Applying Lessons Learned
• Developing an Action Plan to Close the Gap
• Sources of Further Information
• Questions and Answers

10. DTC EXERCISE (OPTIONAL)

• Optional Exercises Analyzing Company Item(s) on Last Day