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click here for sample
screen
Function screen list showing functions
Survey
the customers of the product so they can rank the ‘Value
Elements’ in importance to them.
The
‘Value Elements’ are ranked by the customers
to show which ones are most important to them in terms
of the ‘Value’ they receive from them.
This
screen shows a simple ranking from most important (1)
to least important (10) to the customer.
click
here for sample screen
function screen showing functions
and rank
Next,
we go back to the product cost list and use the ‘cost
allocater’ to determine how much each ‘Value
Element’ costs to provide. We go through the cost
list and ‘allocate’ a percent of each cost
out to the ‘Value Elements’ that the product
provides. The result is a list showing how much it costs
to provide each ‘Value Element’ or ‘Benefit’
to the customer
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here for sample screen
Value Element list with the costs
Now
we can compare how much it costs to provide each ‘Value
Element’ to how much value the customer says they
receive from each ‘Value Element’ that the
product provides them.
We
can identify ‘Value Elements’ that exhibit
‘value cost mismatches’.
- High
cost to provide and low value to the customer
- Low
cost to provide but high value to the customer
The
highest cost ‘Value Elements’ usually have
unnecessary costs that can be reduced
click
here for sample screen
function list showing cost and
customer ranking
Now
we know which value elements should be changed because
their cost does not match the value the customer believes
they get from them. We can easily track back to the
product costs to identify which costs should be reduced.
We can also investigate new ways to provide the targeted
‘Value Elements’ that will meet customer needs
better while often costing less.
We
would now want to:
- Brainstorm
solutions for each target ‘Value Element’
- Describe
and rank the solutions
- Choose
best solutions to implement
- Implement
solutions
click here for sample
screen
solutions screen with solution
savings
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