Value Engineering Technique and Its Role on Reducing of Manufacturing Costs (Case Study: Giad Industrial Group- Sudan)

Abstract

This study reviewed the impact of value engineering technique on reducing of manufacturing costs at Giad industrial group, also, it aimed to explore the reasons behind not adopting the value engineering technique by the company. For this purpose the researchers distributed (130) questionnaires, while (105) questionnaires were retrieved representing (81%) of the total sample. The study used SPSS program to arrive at the results of the study by calculating mean, standard deviations, chi-square, and percentages. The study results indicated that Giad industrial group doesn’t adopt value engineering technique in measuring and reducing the cost of its products, although the adoption of value engineering technique may provide useful information for controlling and reducing manufacturing costs. Moreover, achieving profit requires reducing the overall costs of industrial elements. The study concludes that the major reasons behind not adopting value engineering technique at Giad industrial group can be attributed to the lack of knowledge about value engineering and its merits; besides the lack of support from the top management at the company for the application of this technique. Furthermore, Giad industrial group uses the absorption costing and break-even point analysis rather than value engineering technique. The study calls for the necessity of applying value engineering technique at the company since it has been regarded as a complementary technique for other costing systems