Definition Value Added - Definition of 'Value Added' and the Three Levels of Value Added

A

Atul Khandekar

#11
Sometimes I feel Lean and ABC stretch the definitions too far. If there is no payroll function, there is no motivation for adding real value.The idea I think is not to consider any costs as indirect costs or overheads.

As for QA department, the questions to be asked are:
1.In the eyes of customers, are the activities worth paying for?
QA Dept would actually take actions to ensure that real value is added to the product. So I think they are.
2. Will the operations cease without QA department?
 
Elsmar Forum Sponsor
M

M Greenaway

#12
Geoff

The customer will pay for quality. Part of most quality department functions is to assure the quality of the product or service - hence the quality department adds value.
 
#13
Yes, QA adds value.

Of course QA adds value....

...and if we didn't think so, I suppose we wouldn't be in this line of work, right?

It may be computers, cars, raw steel, wood or services... Our quest is to aid our respective organisations to make certain that the customer gets the agreed merchandise to a cost that is beneficial to both us and our clients. If that isn't adding value, I don't know what is...

/Claes
 
E

energy

#15
2 cents

Geoff Cotton said:

To me value added is simply anything that changes the fit form or function of a product or service.

Geoff
In the good ole days, that definition would be grounds for MRB(Material Review Board for you young folk), with Customer's approval. We would have needed Government approval for anything that changes form, fit or function of a product or service. I have a problem connecting it with a Value added definition. But, it wouldn't be the first time that I mis-read something.:bonk:
:ko: :smokin:
 

Mike S.

Happy to be Alive
Trusted Information Resource
#16
I think the term "value added" is one of those relative terms that can be correctly defined in many different ways depending on the viewpoint of the user(s). IMO, to be used effectively in an organization it has to be defined by that organization. My boss used to define it to mean (for our organization) direct operations performed on something that the customer was willing to pay for. For example, if we took a piece of Aluminum bar stock and machined a complex part from it to a customer drawing specification and then plated it with Silver, the machining operations and Silver-plating operations were value-added and the support operations like the purchasing of the bar stock, sales order entry, inspection, shipping, and finance/billing operations were non-value added. Right or wrong, that was our definition and it may or may not work for others.

Mike S.
 
E

energy

#17
I got it now

Atul Khandekar said:

Some interesting thoughts here...
http://Elsmar.com/Forums/showthread.php?s=&threadid=1463
Good link, Atul. Man, I was all over that one. I now see where Geoff was coming from. For example, Louie, who works on the burr bench making minimum wage knocking the burrs off that drilled hole is "value added" while all the other non manufacturing employees are merely flotsam or jetsam. That's a Navy term for debris. Oh yea!:vfunny: :ko: :smokin:
 
Last edited by a moderator:
M

M Greenaway

#18
Mike

If we consider your defenition and then look at Lean Manufacturing principles of removing all non-value adding activities we would be unable to produce anything !!
 

Geoff Cotton

Quite Involved in Discussions
#19
Energy,

I thought my comment regarding QA might get a reaction.
:biglaugh:

My thoughts are that we in QA do add value in the sense that we protect the customer, we are always looking to improve the product and make it more robust to what the customer tries to do with it, and we are always looking to take 'waste' out of the supply chain thereby reducing the cost to all involved.


Geoff
 

Mike S.

Happy to be Alive
Trusted Information Resource
#20
no no

M Greenaway said:

Mike

If we consider your defenition and then look at Lean Manufacturing principles of removing all non-value adding activities we would be unable to produce anything !!
_________________
M,

Please re-read my post. I did not say that is MY definition, it was my boss' definition (the President of the company). If I had written it that way I'd be saying I and all of QA (not to mention the people that cut my paycheck!) bring no value to the company and perhaps should be eliminated (not too likely I'm gonna do that!), but the boss was reminded that under his definition HE was non-value added and he understood that. His goal was not to eliminate what he called non-value added, just to reduce it as much as possible. It was just his definition; everyone in the room needed to understand what the term meant and, being the Prez, he got to choose. As we see in the Cove all the time, sometimes different people (and pretty smart folks at that) define or interpret the same thing differently. Heck, I haven't seen a concesnus on value-added yet, have you??!!

Another term that prompted lots of discussion was defining "on-time delivery" for our products and "lateness" for employees regarding their start times. Think those are easy? NOT!:bonk:

Mike S.
 
Thread starter Similar threads Forum Replies Date
BeaBea Registrars with VAR (Value Added Reseller) experience Registrars and Notified Bodies 8
G Non Value Added Corrective Actions IATF 16949 - Automotive Quality Systems Standard 15
V Analysis of 'Value Added' System & Process Steps - Inspection Pharmaceuticals (21 CFR Part 210, 21 CFR Part 211 and related Regulations) 2
D Value-Added Analysis - Staff (Employee) Satisfaction Quality Tools, Improvement and Analysis 11
T ISO Auditor Training - What online training is actually value added? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 13
WCHorn Are Inspection Operations Value Added? Lean in Manufacturing and Service Industries 50
A Value added activities and WIP in a VSM Lean in Manufacturing and Service Industries 2
B Distributor Outsourcing Value Added Services - Is it work transfer? AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 9
Z How to Establish a Process in Terms of more Added Value? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 1
J Adding Value to a 3rd Party Audit - What does 'Value Added' mean to you? General Auditing Discussions 25
M SPC vs. 100% Inspection - Is SPC still value-added when 100% inspection is in place? FMEA and Control Plans 40
Jen Kirley Beyond Compliance: Value-added auditing for system performance The Reading Room 9
G Added Value of EN9100 Certification for the Business - Aerospace and defence AS9100, IAQG, NADCAP and Aerospace related Standards and Requirements 2
W Is R&D a value-added process? IATF 16949 - Automotive Quality Systems Standard 4
R Added Value Benefits for a Warehousing Company to be ISO13485 Registered ISO 13485:2016 - Medical Device Quality Management Systems 4
T Recertification for Internal Supplier Auditors value added General Auditing Discussions 9
Paul Simpson Value Added External Audits - Do External Audits add value to your system? General Auditing Discussions 36
D Testing process is non value added process under TS16949? IATF 16949 - Automotive Quality Systems Standard 1
T Increasing Quality: Cost vs. Value Added Misc. Quality Assurance and Business Systems Related Topics 3
L Corrective Action System - Not Value Added ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 10
D VALUE ADDED - Take 2 Misc. Quality Assurance and Business Systems Related Topics 28
A Linking ISO 9000 to Economic Value Added ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 2
S PPAP can we say waiver? A bureaucratic, non value-added mess QS-9000 - American Automotive Manufacturers Standard 38
M Determining a tolerance value for Measuring devices in-house inspection General Measurement Device and Calibration Topics 12
Proud Liberal Improving low p-value Statistical Analysis Tools, Techniques and SPC 13
qualprod Best approach to get a real value as average? Statistical Analysis Tools, Techniques and SPC 6
F Missing value of Uncertainty B Measurement Uncertainty (MU) 10
F Calibration certificate content - Average Value and True Value ISO 17025 related Discussions 6
S In BAC5300 we have machining mismatch allowed is 3tau, what is the value of tau? Document Control Systems, Procedures, Forms and Templates 1
S Change value of target during a batch Capability, Accuracy and Stability - Processes, Machines, etc. 0
A Acceptance p-value for linearity and bias analysis in minitab results Gage R&R (GR&R) and MSA (Measurement Systems Analysis) 0
A Torque Value for Different types of Fasteners (Socket Head, Button Head, CSK) Manufacturing and Related Processes 2
M IATF 16949 - 8.5.6.1.1 Providing a list of process controls: Does this requirement add value to QMS? IATF 16949 - Automotive Quality Systems Standard 4
qualprod Cycle times, value stream mapping, inventory, average values? Lean in Manufacturing and Service Industries 1
Ashok sunder What are the criteria for setting a target KPI value against a quality objective? Benchmarking 7
S Adding Value prior to signing EASA Form 1 EASA and JAA Aviation Standards and Requirements 5
M Creating a Plant Level Value Stream Map Process Maps, Process Mapping and Turtle Diagrams 1
A IMDS - Changing the Locked Weight Value RoHS, REACH, ELV, IMDS and Restricted Substances 1
T Value Chain Map for Food Services Industry Service Industry Specific Topics 1
O P-Value less than 0.05. but everything else in control Statistical Analysis Tools, Techniques and SPC 19
qualprod P x I = Value interpretation for residual risk? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 1
O CPK with a P value less than 0.005 Manufacturing and Related Processes 8
G What degrees of freedom means in uncertainty budget and how do I set the value Measurement Uncertainty (MU) 2
Q Really do they add value (Vision, Mission, Values)? ISO 9000, ISO 9001, and ISO 9004 Quality Management Systems Standards 1
D What is the exact Temperature Coefficient Value to be set on a Conductivity Meter? General Measurement Device and Calibration Topics 2
M Value Stream Mapping Calculations Process Maps, Process Mapping and Turtle Diagrams 5
L How to interpret the average R bar Value shown in the R Chart Gage R&R (GR&R) and MSA (Measurement Systems Analysis) 2
R How To Calculate & Print CDF and Lower Bound CDF value for some t(time) with Minitab? Using Minitab Software 1
P Purpose of calculating Uncertainty value in calibration study Measurement Uncertainty (MU) 5
J Agenda of Value Stream Mapping workshop required Quality Tools, Improvement and Analysis 1

Similar threads

Top Bottom