Guide
How do you run value engineering (VA/VE) on a machined or cast part without changing fit, form or function?
Value engineering is a structured review of what each requirement on a part actually does, followed by changes that deliver the same required functions at lower total cost. On a machined or cast part already in production, it means challenging tolerances, material, finish, setups and process one lever at a time, proving each change with evidence, and releasing it through a deviation or an engineering change so the part still fits, works and interchanges with every part already in the field.
By Saola Manufacturing engineering team · Published · Updated
The usual trigger is a purchasing target: a cost-down number for next year on a part that has been in production for a while. The quick answers, pushing the supplier on price or moving the part to another shop, leave the drawing untouched, and the drawing is where most of the cost is locked in. This guide gives buyers and engineers a working method: where the cost of a machined or cast part comes from, how to find the requirements that are paying for nothing, a decision table of levers with the evidence each one needs, the approval route for each, and what to write on the drawing and RFQ so the change sticks.
On this page
What does value engineering on an existing part actually mean?
It means lowering the total cost of a part by changing how its required functions are achieved, not by dropping any of them. If a change alters fit, form or function, it is a redesign that needs full requalification, not a VA/VE change.
The method grew out of Lawrence Miles's work at General Electric in the 1940s (SAVE International dates it to 1947), and the terms are still used loosely. Value analysis (VA) usually refers to reviewing a part already in production; value engineering (VE) to doing the same during design. The SAVE International Value Methodology Standard treats value analysis, value engineering and value management as one methodology and describes function analysis as its heart, the step that separates it from other improvement practices. The US federal definition in OMB Circular A-131 says the same in other words: analyze the functions of an item to achieve its essential functions at the lowest life-cycle cost consistent with required performance, reliability, quality and safety. In Europe, EN 12973:2020 covers the same ground under the name value management.
"Fit, form and function" also has a precise meaning that is useful as a boundary. The Defense Federal Acquisition Regulation defines form, fit and function data as the data describing the required overall physical, functional and performance characteristics of an item, to the extent needed to identify items that are physically and functionally interchangeable. A practical test follows from that: after the change, will an old part and a new part go into the same assembly, at the same interfaces, and pass the same functional test? If yes, the change is a VA/VE candidate. If no, it is a new part.
You can recognize a VA/VE problem by its symptoms: a cost target with no design change budget, a part whose drawing was copied from an older design or a prototype, tolerances that are the same on every feature, a finish chosen for one application and carried to another, or a casting that is machined on almost every face.
Where does the cost of a machined or cast part usually come from?
Most of the cost of a production part is set by the drawing: the number of setups and operations, the tightest tolerances and finishes, the material and stock form, and the finishing and inspection those requirements force. Pressing the supplier on margin leaves every one of those untouched.
Use the drivers below as a checklist, roughly in the order they are worth checking on a mature part:
- Setups and operations. Every time a part is re-clamped, the shop pays for fixturing, a first-piece check and the risk of mismatch between setups. Features placed on many faces, or datums that force a part to be flipped repeatedly, add operations that the function does not need.
- Tolerances and surface texture tighter than the function needs. A tight tolerance changes the process: a finishing pass, a reamer or a grinding step, a slower feed, more frequent gauging and a higher scrap rate. Blanket tolerances carried from a title block onto non-functional features are a common source of cost with no benefit.
- Material and stock form. The grade drives both raw material price and machining time. A part machined from a solid block when most of the block becomes chips, or a part in a grade that machines slowly when a free-machining equivalent would meet the requirement, carries cost in every unit.
- Finish and secondary operations. Masking, selective plating, special colors, hard coatings where a standard coating would do, and handling between operations add cost that is easy to miss on a quote that shows only a unit price.
- Inspection and documentation. Full inspection of every dimension on every part, or measurement methods that require a CMM program for features a gauge could check, add cost on each lot.
- Process choice at the current volume. A part designed when volumes were small may still be machined from bar or billet long after the volume justifies a casting, a forging or a near-net extrusion, or the reverse.
The order is a starting hypothesis, not a result. The diagnosis step below tells you which driver dominates on your part.
How do you find the requirements that are paying for nothing?
Put the cost of each operation next to the function of each feature, and look for features whose cost is high but whose function is secondary. That comparison of cost to worth is the core of the value methodology.
The SAVE job plan runs in phases: information, function analysis, creative, evaluation, development and presentation. On a single production part, a lean version of that plan works well:
- Collect the facts. Current drawing and revision, the 3D model, the mating parts, field returns and warranty data, incoming inspection history, and the supplier's routing. Ask the supplier for a cost breakdown by operation: material, each machining setup, finishing, inspection and packaging. Without it, every idea is a guess.
- Name each feature's function with a verb and a noun. "Locate shaft", "seal fluid", "carry load", "resist corrosion", "identify part". Classify each as basic (the reason the part exists) or secondary (supports the design as drawn). A secondary function with a high cost is the first place to look.
- Mark the critical-to-function features. Interfaces with mating parts, sealing faces, bearing seats, load paths and anything referenced by a safety or regulatory requirement. These are protected; the review works on everything else.
- Put a cost on each function. Using the supplier's breakdown, assign each operation's cost to the feature and function it serves, then sort the list from most to least expensive. A few operations usually carry most of the cost, and those are where the review time should go.
- Compare cost to worth. For each costly function, estimate what the cheapest way to deliver it would cost; the SAVE standard calls this the function's worth, and a high ratio of cost to worth marks the largest opportunity. Then ask what would fail if the operation were simplified, and how anyone would know. If nobody can name the failure, the requirement is a candidate.
- Check the history. A requirement that looks excessive may have been added to fix a field failure. Search the change history and the corrective action records before removing anything.
A quick diagnostic checklist for the first meeting: Are all tolerances on the drawing the same? Is there a general tolerance block, and which standard does it cite? How many setups does the routing show, and why? Which features fail incoming inspection most often? Which finish requirement is the most expensive line on the quote? Is the stock size much larger than the finished part? Answers to these questions usually point to two or three levers worth developing.
Which VA/VE levers cut cost without changing fit, form or function?
The safe levers are the ones that leave every interface and functional requirement untouched: opening non-functional tolerances, relaxing surface texture on non-functional faces, consolidating setups, changing to an equivalent material or a near-net stock form, and right-sizing finish and inspection. Each one still needs evidence, and some need customer approval.
Use the table to pick the lever, the evidence engineering will ask for, and the approval route that normally applies. A change to material, process or production site can affect more than the drawing shows, so treat those rows as engineering changes, not as supplier choices.
| Lever | Evidence engineering needs | Usual approval route |
|---|---|---|
| Open tolerances on non-functional features; adopt a general tolerance block | Tolerance stack-up of the assembly; list of critical-to-function features left unchanged | Drawing revision (ECN); no new part number if parts stay interchangeable |
| Relax surface texture on non-functional faces | Confirmation the face does not seal, slide, bear or carry a coating requirement | Drawing revision (ECN) |
| Consolidate setups; move or re-reference datums | Datum scheme review against the mating parts; first article on the new routing | Process change; drawing revision if datums change; customer notification where a part approval exists |
| Change to an equivalent or free-machining grade | Comparison of the material specifications: strength, hardness, corrosion, weldability, restricted substances | Drawing revision; customer approval where the material is specified by the end customer |
| Near-net stock: extrusion, casting or forging instead of solid bar or billet | Mechanical properties and internal soundness of the new form; machining allowance; first article | Engineering change with qualification; tooling decision |
| Simplify finish: standard coating class, fewer masked areas, standard color | Corrosion and wear requirement of the application; appearance standard if cosmetic | Drawing or specification revision |
| Right-size inspection: full checks on critical features, sampling on the rest | Process capability data on the critical features; inspection history | Inspection plan or purchase order revision; drawing unchanged |
| Trial a change before committing | Defined quantity or lots, test plan, acceptance criteria | Deviation, limited in quantity or time, then an ECN if the trial passes |
Two cautions apply to every row. First, a lever that saves cost in machining can add it elsewhere: a looser tolerance may mean more selective assembly, and a cheaper grade may need a more expensive coating. Judge each change on total cost, which OMB Circular A-131 frames as life-cycle cost, not on the machining line alone. Second, if your drawing uses general tolerances, check which standard and class it cites. ISO 2768-1 sets general tolerance classes from fine to very coarse, and moving non-functional features from a part-wide tight block to an appropriate general class is usually one of the cheapest changes to make, because it needs a drawing revision but no new tooling or material qualification.
Process changes deserve their own review. Turning a machined-from-billet housing into a die casting with machined interfaces can lower unit cost at volume but adds tooling, draft and porosity questions; the die casting vs CNC machining break-even guide covers that decision.
Does a VA/VE change need a deviation or an engineering change notice?
Use a deviation when you want to trial a change on a defined quantity or period before deciding; use an engineering change notice and a drawing revision when the change becomes permanent. If the change breaks interchangeability with existing parts, it needs a new part number, not just a revision.
A deviation is a written, pre-approved permission to build a limited quantity to something other than the current drawing. It is the right tool for a VA/VE trial because it is bounded, it has an expiry, and it leaves the drawing unchanged until the evidence is in. It is not a substitute for an engineering change: a deviation renewed lot after lot is a drawing that nobody updated. The supplier deviation guide linked below explains how deviations differ from waivers and use-as-is decisions.
An engineering change notice releases the permanent change. ASME Y14.35 sets out how drawings and associated documents are revised and how each revision is identified and recorded, so the new revision letter, the change description and the effective point are traceable on the drawing itself. Agree the effective point with the supplier: the lot, date or serial number from which the new revision applies, and what happens to stock and work in progress at the old revision.
Customer approval is a separate question from your internal release. Where a part has a formal approval, for example under the AIAG Production Part Approval Process (fourth edition, 2006), changes such as a different material, new or modified tooling, a different process or a different production site generally require customer notification and may require resubmission before shipment. US federal contracts have their own route: the value engineering clause in FAR 52.248-1 lets a contractor submit a value engineering change proposal and share in the savings, but only for changes that reduce cost without impairing essential functions or characteristics. If you are not sure whether your customer needs to approve, ask before the first changed lot ships.
What should the drawing, RFQ and PO say so the savings stick?
Write the result of the review into documents the supplier must follow: a revised drawing that shows which features are critical and which carry general tolerances, an RFQ that asks for the price of each change separately, and a purchase order that names the revision and any deviation in force.
- Flag the critical features. Mark critical-to-function dimensions on the drawing with your company's key characteristic symbol and say what it means in a note. Everything not flagged can then be held to a general tolerance class without argument.
- State the general tolerance standard and class. A title block that says "unless otherwise specified" must name the standard and class, for example ISO 2768-mK, or give the values for each decimal place. A block with no standard invites two shops to read it two ways.
- Specify material by standard, not by trade name. Name the specification, grade and temper, and list approved alternates if you have qualified them. That lets a supplier propose an equivalent without a deviation each time.
- Specify finish by standard and class. Name the coating specification, type and class, the color reference if cosmetic, and the areas to mask. Leave out masking that has no function.
- Ask for line-item pricing on the RFQ. Request the as-drawn price and the price with each proposed change, plus the supplier's manufacturability comments. Pricing each lever separately shows which ones are worth the engineering effort.
- Name the revision and the deviation on the PO. Quote the drawing revision, any deviation number with its quantity limit, and the effective point of the change, so the receiving inspector checks parts against the right document.
Finally, measure the result against the baseline you recorded at the start: the as-drawn price, scrap and rework, and incoming rejects. A VA/VE change that lowers the unit price but raises rejects has not saved anything.
How is a VA/VE review handled on a Saola order?
Send the current drawing, the cost target and the features you consider critical, and ask for the as-drawn price alongside the price of each proposed change. Machining questions are reviewed at our lead CNC plant; casting, stamping and finishing questions go to the partner plant we manage for that process.
Turned and milled features are made on CNC turning and CNC milling equipment at T.K Viet Nam Precision Company Limited, our lead CNC plant, in operation since 2017. That is where setup count, datum scheme, tolerance and surface texture levers are assessed, and the manufacturability note that comes with the quote is where proposed changes are listed for your engineering team to accept or reject. We do not change a drawing requirement on our own: a proposed change goes back to you, and parts are made to the revision and any deviation you release.
If a lever involves a process change, for example from billet to die casting, or a change of coating at the surface finishing step, that work is done by a partner plant we manage, not at the lead CNC plant, and the quote names the production site and country of origin for each step. A change of process or site can change the country of origin, so check that before releasing the change. ISO 9001 certification is in progress, not held. To start, send the drawing and your target through the quote form.
Frequently asked
What is the difference between value analysis and value engineering?
They use the same function-based method. Value analysis is usually applied to a part or product already in production, and value engineering to a design before release. Many companies use VA/VE as one term for both.
Is value engineering the same as asking the supplier for a lower price?
No. A price negotiation changes the margin on the same drawing. Value engineering changes the requirements or the process so the part costs less to make, which is why it needs engineering evidence and a controlled change, and why the result lasts across suppliers.
Can a supplier make a VA/VE change without telling the customer?
Not to anything on the drawing, the specification or the approved process. A supplier can propose a change, but the part must be made to the released revision unless the customer issues a deviation or a new revision. Changes to material, process or site often need customer notification even when the drawing does not change.
Which VA/VE lever should be tried first on a machined part?
Usually tolerances and setups, because they need the least qualification. Opening non-functional tolerances to a general class and reducing the number of re-clamps often lowers cost without touching any interface. Material and process changes come next because they need more evidence.
Does value engineering apply to cast parts?
Yes. On castings, the common levers are the amount of machining on as-cast surfaces, the machining allowance, datums placed on as-cast features that force extra setups, and impregnation or finishing requirements carried over from a different application.
Sources
- Value Methodology Standard, SAVE International, 1997, revised 1998
- Circular No. A-131, Value Engineering, US Office of Management and Budget, May 21, 1993
- 48 CFR 252.227-7013, Rights in Technical Data, definition of form, fit and function data, Legal Information Institute, accessed October 2026
- FAR 52.248-1, Value Engineering, Acquisition.gov, clause dated June 2020
- ASME Y14.35, Revision of Engineering Drawings and Associated Documents, ASME, current edition 2025
- ISO 2768-1:1989, General tolerances, Part 1: Tolerances for linear and angular dimensions, ISO, 1989
- Production Part Approval Process (PPAP), fourth edition, AIAG, 2006
- EN 12973:2020, Value Management, CEN, 2020