Updated on February 5, 2025

Function-cost diagram

Function-cost diagram is the graph that presents function point score (F) of the system components against their cost (C).

Overview

The function–cost diagram is created based on the results of function-cost analysis.

It can be a very helpful in developing an innovation strategy for the system improvement. It also is useful to show if the system has been designed reasonably or not.

Building the diagram

The horizontal axis of the diagram is the sum of the component costs; the vertical axis is the sum of its function point score. After calculating functionality index and the cost of the components, each of them can be placed in the appropriate place on the diagram.

Insights from the diagram

If the functionality index increases proportionally to the cost of the components, it indicates that the engineering system has been optimally designed. To evaluate this, try to draw a straight line between the points representing the components so that they are distributed roughly evenly around it. If successful, it suggests that the system is designed rationally; if the points are scattered widely across the area, the design leaves much to be desired. The steeper the line, the better it is for the system.

Strategy planning based on the diagram

By splitting the diagram by four parts, the components can be grouped according to their functionality and costs:
A: low cost, high functionality index,
B: low cost, low functionality index,
C: high cost, high functionality index,
D: high cost, low functionality index.

The most valuable components are those that are located in area A (high functionality inex, low cost), which is the desired location for all the components. Locating them in this sector is the basis for developing an innovation strategy.

In practice it means:

  • for the components from the section B – increase functionality;
  • for the components from the section C – reduce costs;
  • for the components from the section D there are two alternative ways:
    • increase functionality and decrease costs,
    • trim them completely from the system.
CONTENTS

Powered By EazyDocs