Evaluating the Benefits of Value Driven Designs
There are several program outcomes including aviation safety, legislation and law, management and objectives, as well as science. Exploring and analyzing the reasoning for the meaning of value in preliminary design decision making will enable development of a proposal towards introducing, assessing, and communicating value-oriented perspectives. The project will correlate value aspects at different supply chain levels while assessing maturity of knowledge in order to compute value of design alternatives in comparison to baseline and target. The standpoint of an aircraft subsystem manufacturer will be applied in developing the methodology. Depending on positions within the supply chain, design teams will focus on products and service related aspects as well as products’ design specific components.
Statement of the project
The project will focus on aviation management and operations. It will rely on critical thinking skills, quantitative reasoning, cultural and scientific literacy as well as information literacy with regards to aviation legislation and law, safety, management, and operations. The project will therefore focus on application of value driven design to aero-engine system to demonstrate how methodology and modeling approaches can be used to evaluate designs while selecting value-enhancing solutions. Thus, it will discuss how design teams can deliver the best designs in way the Value Driven Designs are objective, transparent, and repeatable.
Value Driven Designs for air vehicles are complex with the emergent economical and environmental concerns. Julie Cheung, James, Scanlan, James Wong, Jennifer Forrester, and Hakki Eres assert that Value Driven Designs provide frameworks enhancing systems engineering procedures for designs of large systems. The decision making process also employs economics in order for value driven design to be enabled in making rational decisions with regards to optimum business and technical solution at each level of engineering design. The Advisory Council for Aeronautics Research in Europe (ACARE) envisions reducing Nitrogen Oxides by at least eighty percent before 2020 within the aerospace industry (ACARE, 2009). It also targets to reduce Carbon Dioxide emissions by fifty percent and noise levels by half in order to increase safety by five-fold. Consequently, cost effectiveness will improve significantly (Clayton, & Hilz, 2015). These targets will however impose great pressure across the aerospace industry including manufacturers, aircraft operators, and supply chains. More so, it will develop products and services meeting the set targets while remaining competitive as it is committed in producing aviation products and services meeting and exceeding customers’ demands over competitors (Cheung, Scanlan, Wong, Forrester, & Eres, 2010).
Value Driven Designs
According to Litman Todd, the American Institute of Aeronautics and Astronautics should consider global urban areas host numerous people engaging in diverse activities in order to maximize accessibility and minimize costs. Efficiency and livable aviation industry should therefore favor resource-efficiency models in order to reduce traffic, infrastructure costs, hazardous incidences, and pollution (Litman, 2015). The following guidelines should therefore be considered during decision making in order to choose the best designs in accordance to customers and business developers’ needs and wants. The guidelines are consistent with aircraft conceptual and engine preliminary designers as well as decisions formulated through supply chains. In order for a value driven design to be regarded as objective, transparent, and repeatable, the decisions made should not be opinionated. This will ensure every decision to make a design is based on tested facts and the results analyzed. The factual results and analyses should lead to the same end design even after designers and teams have been changed in order to achieve repeatability. Lastly, the design processes should attain decision yields easily. Thus, they should be flexible to allow engineers and other parties to understand clearly, observe, and critique where necessary (Cheung, Scanlan, Wong, Forrester, & Eres, 2010).
Value Driven Designs refer to the process of combining system engineering, economics, and optimization. Thus, they improve system engineering procedures while employing economics to attain optimization at every level of engineering design. Profitable engine programs are based on customer demands relating to price and market share, demand prices, and costs. In order to choose the nest design, the discipline of optimization should be applied as it provides a great deal of relevant optimization theory on whether computerized or manual search tools have been used by engineering teams (Duquette , & Dorr , 2015).. The objective functions can therefore be flown down to subsystems and components maintaining balance in the system. These notions are applied in developing large systems as they provide designers with numerical measures applicable for optimization purposes. For example, product value or profitability can be applied as overall system design objective function in order for each component to maximize optimized value throughout the system. The figures below summarize the definition of Value Driven Designs.
(Cheung, Scanlan, Wong, Forrester, & Eres, 2010)
(Cheung, Scanlan, Wong, Forrester, & Eres, 2010)
Value Driven Designs, Programs and Benefits
Herbert Simon in 1968 gave a lecture on value driven design. He claimed essential engineering design issues existed at the boundary between product’s internal structure and its external aspects. These aspects are vital in determining how Value Driven Designs relate with the environment. For example, they elucidate boundary between internal and external hierarchical organizations of engineered systems such as airplanes and the engines. Through the decision theory, Herbert stated values or preferences are vital in making rational decisions. His predecessors also proved that Value Driven Designs have internal structures and formalizing solution to distribute optimal designs consistent with objective functions for each component. This was affirmed by American Institure of Aeronautics and Astronautics in 2005 after the Value Driven Design Program Committee was formed in order to advance development and application of Value Driven Designs concepts and methods (Peoples, & Wilcox, 2006).
In order for Value Driven Designs to work, development of System Value Model is required. This is a long term economic-based profitability model. Conventional measures of profitability and societal impacts such as noise and pollution through emissions are included (Gonzalez, 2016). They allow aircrafts to earn revenues depending on airline operations by aircraft product model providing extensive attributes such as aircraft payload, weight, fuel burn, engine number, development, unit, and maintenance costs as well as reliability. According to Owen Brown and Paul Eremenko, aircraft engine design should rely on value model which focuses on how the airlines can create profits for the owners from overall revenues. This translates to purchase price and feeds into the program cash-flow stream of manufacturers. Levels of competition however also determine how profits are shared. Thus, if the profits are huge, the share portions are larger. Value model therefore focuses on how airline users employ products without containing internal details of the aircraft design (Brown, & Eremenko, 2009).
As a result, economists should build entire value model without necessarily understanding how aircrafts and jet engines function. This is because the crucial parts of the value model represent how customers make revenues from the products and how the products cause customers to incur costs. Value Model should also translate customers’ profits into products prices and balance product prices with production costs in discounted cash-flow analysis. This translates to development of a business plan when introducing a new product (Sopranos, 2016).
The aviation industry however is complex and competitive with regard to airlines, aircraft manufacturers, and engine manufacturers. As a result, a Surplus Value imagines simpler structures through which firms include airlines as well as manufacturers of aircrafts and engines. The Surplus Value Theory states that, the best engine design for a simple airline is the same as the best engine design for the actual engine manufacturer in the actual complex industry. The profit model on the other hand for a simple airline which equals to ticket revenues minus equipment manufacturing and operational costs is much simpler. More so, it does not require competitive analyses. Thus, the Surplus Value Theory can be defined as the calculated profit which is equal to combined profits of an airline as well as engine and aircraft manufacturers. This is the actually intended profits that are equivalent to making design choices (Peoples, & Wilcox, 2006).
Attributes of the Products and Components
Typical attributes for commercial airlines include payload, fuel burn, range, and manufacturing and maintenance costs. These inputs should be expressed in meaningful terms relevant to design engineers. All the attributes have a direct impact on revenues and profits. As a result, stakeholders involved in airline businesses should be considered equally and fairly. This is because some stakeholders may have little impact on profits. For example, top of climb thrust is an aircraft attribute as it is crucial to the flight crew. Thus, if the flight crew influence choices of the aircraft and affect its value through demand, then this should be considered as an important attribute to include (Cheung, Scanlan, Wong, Forrester, & Eres, 2010).
Competitive uncertainties should also be incorporated, through the Game Theory, into the model as they assist in selecting engine architectures. Formally determining attributes of the components is also vital as it ensures none are exempted or dismissed. For example, engineering attributes of the components with quantifiable effects on formerly determined attributes of a product influence the overall value of the aircraft. Thus, stakeholders, engine, and aircraft attributes should be determined using Simplified Quality Function Deployment (DFD) matrices in order to support development of value driven design (Cheung, Scanlan, Wong, Forrester, & Eres, 2010).
The objectives of Value Driven Designs should derive local objective functions from system value model for each component. For example, for a commercial airliner, the engine is regarded as the most crucial component. The key to derive the engine objective function is noting the system attributes going into the system value model as functions of component attributes. For example, an aircraft’s weight refers to the sum of all the components making up the aircraft. Consequently, the aircraft range refers to the performance function of various component attributes such as the engine weight and fuel consumption. The sensitivity analysis should therefore be used to determine using the value model output how much system value changes for small changes in each attribute of the engine to be derived. The changes form partial derivatives of each engine attribute versus system value. Thus, engine objective function should be the sum of all engine attributes multiplied with corresponding partial derivatives. Consequently, the findings can be quantified using sensitivity analysis on attribute of interest to derive numbers representing gradients as partial derivatives of component attribute versus system value for the row (Cheung, Scanlan, Wong, Forrester, & Eres, 2010).
Ultimately, the Value Driven Design value is expressed in unit profit to illustrate how sensitivity analysis can be performed to provide engineers with greater understandings on the impact of small changes in each attribute. Consequently, the following Value Driven Designs benefits are achieved. Foremost, Value Driven Designs enables and supports design optimization for the whole system especially during the initial design phases. More so, the optimization is enabled for each component during detailed design. Secondly, Value Driven Designs prevents design trade conflicts. This enables dead loss trade combinations to be prevented. Lastly, Value Driven Designs eliminates requirements for extensive attributes at the component levels. This ensures cost growth and performance erosion caused by requirements are avoided. The benefits of Value Driven Designs can be summarized as shown below.
(Collopy, & Hollingsworth, 2009)
Value Driven Designs address engineering complex systems using simple scalable procedures enabling design optimization in order to find the best design meeting the requirements at a certain amount of value. Occasionally, design engineers do not make rational decisions meeting requirements of each component as the collective results can be irrational. For example, each component design team may sacrifice great costs in order to achieve a small weight reduction while another design team within the same program sacrifices far more weight in order to realize small reduction in costs. Although this enhances teamwork for each team to meet allocated requirements with regard to cost, weight, performance, and reliability, economists refer this aspect as dead loss. It also translates to a net increase in cost and weight in order to decrease performance and reliability to degrade the total system. Consequently, the value of the large systems is reduced by tens of percent (Collopy, & Hollingsworth, 2009).
Thus, Value Driven Designs ensure dead loss is prevented by ensuring each component has an objective function implicitly containing all trade factors among extensive attributes. They also ensure all trade factors are considered among all components in order for two separate trades improving two separate components resulting to dead loss to be avoided and eliminated. Lastly, Value Driven Designs avoid cost growth and performance erosion as each component design team is likely to face a set of requirements for weight, performance, and reliability to be attained. For example, sometimes a component design team can be tasked to pick a design meeting the stated requirements. However, the components of the larger aerospace system are too complex. This is defined as the design process of seeking and discovering in order to reveal end results gradually through as a series of design choices discovered under uncertainties. The design engineer however should however strive to maximize probability of the designs meeting the set requirements. This however is not with line with tasks of optimal design which is to formally search or design the best component maximizing the value of the attributes without violating interface constraints. This is because when design teams maximize profitability of meeting set requirements for complex and non-deterministic design tasks, resulting attributes are distorted (Collopy, & Hollingsworth, 2009).
In conclusion, Value Driven Designs are new and fresh ideas and solutions emerging within the aviation industry. Although they are not processes or methods, they have the energy and ability to clarify engineers’ ways of thinking about aerospace systems in order to improve the industry at large. Thus, they are being adopted as they present better and improved approaches to enhance aviation safety measures at reduced costs within reasonable time periods.
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Brown, C. O., & Eremenko, P. (2009). Value-centric design methodologies for fractionated spacecraft: Progress summary from phase 1 of the DARPA System F6 Program. Paper presented at AIAA Space Conference and Exposition, Pasadena, California. Retrieved from http://webcache.googleusercontent.com/search?q=cache:http://www.dtic.mil/dtic/tr/fulltext/u2/a507863.pdf
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