If two things are mutually exclusive, they are separate and very different from each other. Obviously, you might think that cost and quality fit this definition. Yet, cost and quality can be compatible when a value analysis practitioner uses the formula of Function/Cost = Best Value. This best value formula assumes that if the product, service, or technology being studied meets the customer’s functional requirements reliably and at the lowest cost it then meets the standard or quality for the job it is required to do.
If you asked a room full of people to define what quality means to them, you will come up with a dozen different definitions. I know this to be a fact, since when I’m teaching a value analysis course I always ask this question and I have never gotten even two definitions that were the same. This is because quality is in the eye of the beholder or customer.
That’s why value analysis is so powerful, since it enables you to measure what is important to your customer in their products, services, and technologies by incorporating both cost and quality measurements into their decision making.
In our value analysis teaching, we emphasis that only your customers can decide on the cost and quality of their ideal product, service, or technology. They will know it when they see it, based on their functional analysis. For instance, the function of a petri dish is to “hold cultures.” Its required features are that it be round, plastic, 100 x 21 mm, and have a lid with an air vent. Once the petri dish is bid with these functional specifications, you should be selecting the lowest qualified bidder for this commodity. This will then assure you of the best cost and quality for this petri dish.
As you know, the highest cost product, service, or technology isn’t always the commodity with the best quality. Nor is the lowest cost product, service, or technology always considered to have the lowest quality. All you need to do is read one issue of Consumer Reports to see this concept in practice. That’s why you need a process like value analysis to determine for you and your customers what the best cost and quality products, services, and technologies are for their intended use. I can’t think of another methodology that can provide you with these answers.
