The engineering value economic analysis is a process that measures the value of products by examining the function of each good and service. The value is measures as per the cost of the function it provides. The analysis is aimed to see the increase in value by improving the function itself and reducing the cost of product concerned.

The basic aim is to ensure that the good provides quality and is cost effective. These are cost effective strategies that have been established on the basis of which products are judged and valued. It is an industrial process and is adopted for maintaining different projects as well. The analysis seeks to examine the value of the project system and garner similar output as well.

Performance of the project is measured through risks, costs, and production as well. There must be requirements of both customers and company met for such an economic analysis.

Sample Engineering Value Economic Analysis

SXII Co. was hired for the purpose of analyzing Project no. 23 on behalf of ORENZ Ltd.

Project Name: Production budget plan for Water Heater

Date: 22.3.2012

Objective: Assembling all elements to derive a cost effective production plan for the mentioned product before it is released into the market.

Required Processes to be integrated:

  • Systematic packaging must be introduced for of the product for conceptual and design concept
  • Pre and post production: A need for improvement integration
  • Production cost requirements

Tools needed:

  • Management of all requirements
  • Steps of the production need to be arranged as per prioritization process
  • Quality function development
  • Competition analysis

Cost of each production component:

  • Initial Capital: $4 million
  • Shipping and Packaging: $123,000
  • Equipment: $340,0000
  • Inventory and Handling: $340,000

Cost calculation: It denotes optimum cost of production.


Suitable for production

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