reducing product costs
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www.apriori.com
Costing without ComplexityApril 12, 2023
Myles Peyton, Sales Director
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.2
Cost Challenges are Intensifying
Constantly growing volume of components to cost
Considering cost for multiple early-stage design ideas
Government and safety regulations are driving product cost increases that need to be offset to avoid price increases
Need to find new ways optimize cost of tooling
Complex global manufacturing & sourcing strategies
Predicting costs in the face of volatile material markets is hard!
Cost of Engineering Change Orders are difficult to accurately predict
Cost reduction goals becoming more challenging to achieve; finding the “needle in a hay stack” is time intensive
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.3
With aPriori you can do amazing things
Go from a 3D Solid CAD Model…
…to a detailed cost estimate in seconds
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.4
With aPriori you can do amazing things
Calculate detailed Assembly cost roll-ups…
…in seconds
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© 2011 aPriori – Confidential, all rights reserved.5
Immediate Impact & Long-Term Value
Implementation Year 1 Year 2 Year 3
■ Sourcing / Supply Chain■ Sourcing / Supply Chain■ Re-Design
Savi
ngs
Real
ized
aPriori Value Proposition
■ NPI
Identify where you are overpaying suppliers for production parts
Re-quote, re-route, re-bid to get lower prices
Negotiate optimal pricing on new parts and products
Maximize cost reductions in re-design projects
Reduce the amount of re-design work required after product launches
Prevent costs from being designed in to new products
Launch new products at or below target costs
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.6
aPriori Customers6
* Partial List of Customers
Confirmed savings of $668,109 (2.5% of spend) in 5 weeks
Confirmed savings of €245k (13% of spend) in 4 weeks
Confirmed savings of $300k (5.3% of spend) in 3 weeks
Confirmed saving of $800K+ in 1st year of use for NPI and VA/VE; Tracking ~$2.4M in annual cost avoidance
Reduced time-to-market for NPI by 20% by reducing the time creating cost estimates and obtaining quotesfrom suppliers
Reduced tooling cost by 50% by using visibility to cost to make better design decisions
Confirmed savings of $668,109 (2.5% of spend) in 5 weeks
Confirmed savings of €245k (13% of spend) in 4 weeks
Confirmed savings of $300k (5.3% of spend) in 3 weeks
Confirmed saving of $800K+ in 1st year of use for NPI and VA/VE; Tracking ~$2.4M in annual cost avoidance
Reduced time-to-market for NPI by 20% by reducing the time creating cost estimates and obtaining quotesfrom suppliers
Reduced tooling cost by 50% by using visibility to cost to make better design decisions
Actual aPriori Results• AGCO Corporation• ASML• Bentley • Bissell• Caterpillar• CNH• Cummins• Diebold• Excel Industries• Exmark / Toro• Ford Motor Company• Gardner Denver• Intelligent Energy• Iveco• John Deere• MacDon Industries• Manitowoc Foodservice• NACCO Materials Handling Group• NCR Corporation• Paccar• Polaris• Pitney Bowes• Tecumseh Products• Thermo King (Ingersoll Rand)• Thomas & Betts• ThyssenKrupp Elevator• Toyota material Handling• Schindler Elevators• Sertec• SFI Fabrication• Zebra Technologies
• AGCO Corporation• ASML• Bentley • Bissell• Caterpillar• CNH• Cummins• Diebold• Excel Industries• Exmark / Toro• Ford Motor Company• Gardner Denver• Intelligent Energy• Iveco• John Deere• MacDon Industries• Manitowoc Foodservice• NACCO Materials Handling Group• NCR Corporation• Paccar• Polaris• Pitney Bowes• Tecumseh Products• Thermo King (Ingersoll Rand)• Thomas & Betts• ThyssenKrupp Elevator• Toyota material Handling• Schindler Elevators• Sertec• SFI Fabrication• Zebra Technologies
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.7
aPriori CustomersDave Longren Vice President and Chief Technology OfficerPolaris Industries
Garry BallSenior VP of Worldwide EngineeringAGCO Corporation
* Partial List of Customers
• AGCO Corporation• ASML• Bentley • Bissell• Caterpillar• CNH• Cummins• Diebold• Excel Industries• Exmark / Toro• Ford Motor Company• Gardner Denver• Intelligent Energy• Iveco• John Deere• MacDon Industries• Manitowoc Foodservice• NACCO Materials Handling Group• NCR Corporation• Paccar• Polaris• Pitney Bowes• Tecumseh Products• Thermo King (Ingersoll Rand)• Thomas & Betts• ThyssenKrupp Elevator• Toyota material Handling• Schindler Elevators• Sertec• SFI Fabrication• Zebra Technologies
• AGCO Corporation• ASML• Bentley • Bissell• Caterpillar• CNH• Cummins• Diebold• Excel Industries• Exmark / Toro• Ford Motor Company• Gardner Denver• Intelligent Energy• Iveco• John Deere• MacDon Industries• Manitowoc Foodservice• NACCO Materials Handling Group• NCR Corporation• Paccar• Polaris• Pitney Bowes• Tecumseh Products• Thermo King (Ingersoll Rand)• Thomas & Betts• ThyssenKrupp Elevator• Toyota material Handling• Schindler Elevators• Sertec• SFI Fabrication• Zebra Technologies
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.8
Case Study: Value Engineering & NPI
Challenge
No visibility to cost during product development cycle
Looking for tools to help control costs in highly competitive marketplace
$1.8B Manufacturer of personal recreation vehicles
Solution
Corporate rollout of aPriori to inform decisions on new and current products
Results • $821,000 product cost savings reported in first year of use• Cost avoidance estimated at $200,000 per month• Potential savings over 3 years of contract > $7M and 7:1 ROI
Results • $821,000 product cost savings reported in first year of use• Cost avoidance estimated at $200,000 per month• Potential savings over 3 years of contract > $7M and 7:1 ROI
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.9
Cost Challenges We Address
• Cost Components w/o CAD Model
Research & Development• Designing-to-Cost & Meeting Targets• Shortening Overall NPI Lifecycle• Tracking Total Product Costs (BOMs)
New Product Initiatives
• Reducing Current Product Costs• Costing Engineering Change Order • Identifying Outliers and Analyzing
Components for Cost Reductions
Value Analysis/Value Engineering• Developing Time Standards• Capital Asset Justification
Manufacturing
• Estimating Costs for NPI Projects
• Analyzing Make vs. Buy• Identifying Outliers and
Analyzing Components for Cost Reductions
Cost Engineering• Negotiating with
Suppliers• Creating Cost
Models *
• Developing Should Cost Analyses
• Analyzing Make vs. Buy• Identifying Outliers and
Analyzing Components for Cost Reductions
Sourcing• Negotiating with
Suppliers• Requesting &
Evaluating Supplier Quotes*
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.10
1. Purchasing can identify where they are being overcharged by their suppliers and have a fact-based negotiation with suppliers.
2. VAVE/Cost-Out activities to trim cost from currently manufactured parts -> for conducting what-if scenarios by making changes to geometry, material, quantity, process, routing, etc. To identify savings opportunities.
3. New Product Introduction – Engineers get real-time cost information as geometric changes are made allowing for least-cost designs to be generated at the beginning of the product life-cycle -> for engineering cost out of the product and avoid unnecessary cost from the beginning!
1. Purchasing can identify where they are being overcharged by their suppliers and have a fact-based negotiation with suppliers.
2. VAVE/Cost-Out activities to trim cost from currently manufactured parts -> for conducting what-if scenarios by making changes to geometry, material, quantity, process, routing, etc. To identify savings opportunities.
3. New Product Introduction – Engineers get real-time cost information as geometric changes are made allowing for least-cost designs to be generated at the beginning of the product life-cycle -> for engineering cost out of the product and avoid unnecessary cost from the beginning!
Usage Summary
www.apriori.com
© 2011 aPriori – Confidential, all rights reserved.11
www.apriori.com
Thank youMyles Peyton, Sales Director
April 12, 2023
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