Frugal Engineering —The concept of developing innovative, no-frills products at the lowest cost possible. Eg – TATA Nano $2,500 price tag that targets price-conscious customers, is the poster child for frugal engineering.
What is frugal re-engineering
Defined as a Structured, Sustainable process of continually redesigning products to cut costs Cost-effective is a continuous improvement in manufacturing of a product
For example, plastic parts can be redesigned to be made of polypropylene instead of costlier fiber-reinforced plastic, and low-temperature specs can be relaxed for window-channel grease in temperate regions that don't have harsh winters
Frugal re-engineering builds on the ...view middle of the document...
An industrial goods company that broke down its corporate-wide cost-reduction targets to the employee level instilled a sense of both ownership and urgency and ultimately doubled cost savings.
* Employ a product life-cycle approach. While frugal re-engineering might provide immediate impact, the concept can reap consistent long-term benefits when viewed as a tool for reducing costs over the product's entire life cycle.
* Insist on a frugal value stream. Because a significant portion of material costs are paid to suppliers, it is important to get all value-chain players in step with the frugal re-engineering strategy. The cost of procured parts can be reduced by collaborating with suppliers. Suzuki in India launched a "one gram one component" weight reduction program, encouraging its design teams, employees, and vendors to suggest solutions. Nearly 300 suggestions were implemented with a 15 percent reduction in vehicle weight and a corresponding reduction in cost.
* Stand alone, and be independent. Independence allows the team to drive the implementation of ideas in a timely manner. The harder it is for teams to push ideas through the system, the harder it is to get them implemented
* Focus on program management. Aligning various stakeholders toward common objectives is essential for a dedicated program management team. The team's role will include providing technical support to idea generators, breaking down barriers to putting ideas into action, and helping streamline implementation
* Be empowered. A strong leader will break logjams and vouch for bold ideas in the face of vested interests that may be acting at cross-purposes. Ideally, the team leader reports directly to the chief operating officer
* Feature strong governance. A truly structured process requires a multilevel governance organization. Only then can ideas be properly evaluated and effectively used. For example, most obstacles are tactical, and the majority are easily overcome with structured, cross-functional meetings at the right levels. However, when issues need to be escalated for senior-level decisions, the structure will provide for a cross-functional forum chaired by senior leaders to arrive at a consensus. Finally, steering-committee reviews at the COO level will monitor adherence to strategic and business-unit objectives. In short, a well-defined governance structure acts as an internal auditing agency for implementing ideas
* Seek cross-functional input. Frugal re-engineering is not just an engineering endeavor; it depends heavily on input from other areas. We recently helped an automotive original equipment manufacturer (OEM) by getting input from sourcing, marketing, and manufacturing; this doubled the amount the OEM would have saved had it worked solely with the engineering department
* The Process based on – Structured, straight forward process based on two core elements: idea generation, and idea validation and...