Beyond Target Costing: Manufacturing Cost Policy Deployment for New Products
The purpose of this paper is to present a method to quantify the costs of potential losses from production processes for new products to prioritize improvement projects based on the target cost and provide data and information for feasibility studies of continuous improvement projects. The specificity of the manufacturing cost policy deployment for new products is to identify the percentage of cost of future production phases which does not add value from a customer perspective, dynamically throughout the product life cycle. The percentage of non-value added cost is based on loss of each manufacturing process and is determined scientifically based on data and facts. Using the proposed method helps manufacturing companies in the acceptance of certain orders which at first glance are unprofitable. Moreover, the proposed method will help develop scenarios for continuous cost reduction after starting production through continuous improvement of productivity and quality required. The empirical results are based on the study during a year and a half in the automotive company, using action research methodology.
Laurentiu Slatineanu, Vasile Merticaru, Florin Negoescu, Margareta Coteata, Razvan Pacurar, Gabriela Strnad, Irina Tita, Gheorghe Oancea, Petru Dusa, Eduard Nitu and Oana Dodun
A. Posteucă and M. Zapciu, "Beyond Target Costing: Manufacturing Cost Policy Deployment for New Products", Applied Mechanics and Materials, Vols. 809-810, pp. 1480-1485, 2015