$23M
In annualized savings realized
Oil Equipment Manufacturer Implements Value Management: Product Value Management Drives 29% Cost Reduction Across Product Families
Industry: Oil & Gas, Sustainable Energy
Service: Cost and Value Engineering
Service: R&d and Product Profitability
Service: Supply Chain
Our Client
A downstream oil equipment manufacturer serving the global energy market.
The Challenge
Following a sharp drop in crude oil prices, the company’s engineer-to-order model became unsustainable. High customization costs and excessive product complexity weakened competitiveness and profitability.
- High production costs from fully engineer-to-order operations
- Thousands of SKUs causing inefficiencies in design and procurement
- Need to standardize and simplify product portfolio for cost efficiency
Real Results Achieved Together
Through Product Value Management, EFESO helped the client simplify product design, optimize cost structures, and strengthen supply chain efficiency across its portfolio.
29%
Average cost reduction per product family
Transformation Impact
- Standardized configure-to-order product portfolio covering 80% of market needs
- Increased cross-functional collaboration through Value Engineering practices
- Established a sustainable cost optimization culture within engineering and operations
- Improved manufacturing and procurement efficiency across 17 product families
Our Approach
EFESO deployed a comprehensive Product Value Management (PVM) approach integrating configure-to-order design principles, Value Engineering, and supply chain optimization.
Configure-to-Order Strategy Development
- Designed a standardized product portfolio meeting 80% of target market requirements.
- Used Value Engineering to rationalize product complexity and enhance modularity.
Value Engineering Implementation
- Introduced structured Value Engineering processes supported by coaching and training.
- Conducted cross-functional workshops across engineering, manufacturing, and supply chain teams.
Cost Optimization & Supply Chain Efficiency
- Identified and implemented design, engineering, and sourcing efficiencies across 17 product families.
- Improved overall manufacturing performance and cost control.
Related Services
Cost and Value Engineering
Rising costs demand optimization from design through production. We apply cross-functional value engineering, zero-based redesign, and continuous cost tracking to protect margins.
R&D and Product Profitability
Markets demand profitable innovation faster than ever. We optimize the entire product lifecycle through design-to-cost, rapid prototyping, and portfolio profitability management.
Supply Chain
Supplier complexity obscures 70% of your value creation. We strengthen networks through supplier development programs, risk mitigation strategies, and collaborative innovation platforms.
Want to Drive Cost Efficiency Through Product Value Management?
- Transition from engineer-to-order to configure-to-order.
- Standardize and simplify product portfolios.
- Aiming to achieve measurable cost savings through Value Engineering.
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