Why Cost Engineering Is So Critical in Early Development Phases

Have you considered cost engineering in your latest project?

Have you reached your target cost?

If you can answer both questions with "yes", then you're already ahead of most market competitors.

Efficient development of complex new products is a highly collaborative, interdisciplinary process that requires a seamless flow of information and consistent decision-making. Designers, electrical engineers, product managers, simulation engineers and many others, all need to work together as a team. And when it comes to industrialising those products, then production engineers, purchasers, and quality engineers augment that team.

Due to the ever-expanding range of global competition and pressure on margins, the role of cost engineers has become increasingly important in hardware development processes. Simply put, a cost engineer provides the entire team with insights into component costs and the primary cost drivers.

So, why exactly is it so crucial to involve cost engineering early in the development process, before technical issues are fully resolved?

To answer this question, let’s look at the following simplified graph depicting where costs are determined in a development process:

Once a product reaches a certain level of maturity, often after the concept phase or early serial development, making significant design changes becomes costly and time-consuming. This is because these changes require extensive revalidation of the concept.

During the design process, there are often several options available to us by which we can fulfil the requirements. Cost engineering provides the analytical foundation for making informed decisions about potential solutions upfront, thereby enabling the team to determine the most cost-effective solution.

If cost engineering had not been consulted at an early stage, the design would have been optimised and finalised for machining and potentially missed this opportunity for significant cost savings.