Celestica’s Value Analysis / Value Engineering (VAVE) solutions offer customers a competitive advantage.
A growing number of OEMs are using Celestica’s VAVE approach to optimize products by lowering costs and maximizing value. We spoke with Ed Stodola, Global Commercialization Solutions Lead, and Ken Meyer, Director of VAVE, to learn more.
What are Celestica's VAVE solutions? What problems do they address?
Ed: Balancing the complexities of today's competitive markets, evolving trade regulations, and cost pressures within intricate supply chains is a crucial challenge for our customers. Our VAVE solutions help customers optimize product lines through targeted cost reductions and functional performance improvements. We evaluate both the product design and production processes to continuously improve delivered value while also reducing risk
Ken: We use a five-stage, iterative approach to our VAVE framework. It covers target setting, ideation, a collaborative workshop, idea selection, and a multi-year implementation plan measured by the value of improvements. VAVE is about continuous improvement: focusing on lifecycle cost analysis, improving supply availability, addressing reliability and quality issues, and introducing technology into products.
Ed: Customer collaboration is essential to maximize value. Customers are looking for solutions that improve quality, reduce costs and maintain parts availability. We also need to understand the certification or revalidation needs, so we can determine if an idea is viable or too complex to feasibly implement.
How do Celestica VAVE solutions drive smarter innovation for customers?
Ed: Consider a product that has been in production for a while. There have been technology advances or new components with better functionality and lower cost. Some current components may also soon be obsolete. VAVE allows customers to proactively manage supply risk and innovate by evaluating the current design and new market opportunities. This can increase functionality and expand features, making the product more competitive and future-ready.
VAVE also focuses on improving manufacturing processes. We can leverage advances in test and assembly techniques to lower production costs without impacting quality or delivery of finished goods.
Ken: Our collaborative VAVE approach enables innovation. We bring together subject matter experts from the customer’s organization and Celestica’s global team to participate in a joint workshop. This includes various engineering disciplines, customer-focused teams who oversee test and assembly, and commodity managers. Together we can generate a set of innovative ideas–often over 100 in a single session–then turn them into implementation packages and realize the savings downstream.
Can VAVE solutions help customers navigate the current tariff situation?
Ken: VAVE is already helping customers to navigate this new landscape. First and foremost, because it is largely focused on cost reduction – VAVE helps to offset the additional costs posed by tariffs. Another area VAVE can address the tariff challenge is through alternate supply sourcing. Identifying alternative materials and alternate suppliers is one of the core fundamentals of the Celestica VAVE process.
Ed: The tariff situation is dynamic so supply chain agility is more important than ever. There are a lot of challenges related to procuring parts, moving them from one country to another and then shipping finished goods to customers – many of whom are in the U.S. Celestica’s VAVE solutions help customers optimize their manufacturing process while driving manufacturing cost reduction, and our global network of production sites and suppliers provides the flexibility to create numerous opportunities for our customers.
What results has VAVE driven for customers to date?
Ken: We have driven significant cost reductions, sometimes millions of dollars, for various products. This includes high-volume industrial products and large devices with expensive assemblies.
For example, a smart metering customer needed a continuous improvement approach for their high-volume products. We helped pinpoint areas for improvement through a lifecycle cost analysis. This included alternate sourcing, optimized supply availability, lower material costs, and regulatory compliance. We identified $2M in annualized cost savings and de-risked their growth plans. Read the case study here.
Ed: We draw on a wide range of manufacturing, supply chain, and engineering skills and expertise to drive results. Our broad base of production experience allows us to bring forward new technology, manufacturing, and sourcing ideas and solutions.
How are Celestica’s VAVE offerings different? Why do customers choose to work with your team?
Ed: As a global electronics manufacturer with over 30 years of expertise in high-reliability design, engineering, manufacturing and supply chain solutions, Celestica works across many technologies and markets. We draw on industry innovation and best practices, and our own direct experiences, to help us better understand and appreciate manufacturing risks and opportunities when advising our customers.
Ken: We combine our commodity management expertise with process, test, and manufacturing expertise at our sites. We also use the experience of our global engineering team and the knowledge of our business development, marketing, and program management leaders. This makes Celestica VAVE unique.
Our VAVE process is built on trust. It fosters a long-running, collaborative relationship. VAVE is not a one-off event. It is a continuous improvement model and win-win approach that incentivizes both companies to drive improvements that maximize value
Ready to maximize value for your products and get them future-ready?
To learn more, connect with our Commercialization Solutions team today at commercialization-solutions-team-CLS@celestica.com.