Step 2 :

Identify The Components Of The Product and The Cost Of Each

Component.
( We identify the components and cost of each as follows :

Step 3 :
Determine How The Products Components Contribute To
Customer Satisfaction.
We determine the contribution of each component to satisfying customer criteria. This
step usually requires a team of marketing, operations, and cost management
analysts.
 Step 4 :
Determine The Importance ( Value ) Index Of Each Component.
We determine the importance index for each component, which reflects the value of
the component to the customer. It is shown in the right column below.

* For example, the 22.2 percent index for the motor is determined as follows (the
index for the other two components is computed in a similar way):
( 46.3% 10 % ) + ( 29.3 % 10 % ) + ( 24.4 % 60 % ) = 22.2%