Measuring and

Value Adding

Regardless of industry, manufacturing is about adding value to a product. However, measuring the value added to a product in process has proven challenging.

Many manufacturers measure non-value adding activity instead, and use that as an indirect measurement of value. Others rely on the information generated by their ERP or accounting systems, but this data is not delivered in real-time and is often not empirical.

Value-Adding Activities (VAA) can be defined as any action that adds value throughout the production process. However, each industry measures value differently, which is why we have listed some industry-specific examples below.