Reaching the Cost Target - Current Status in SMEs

Progressive globalization combined with stronger competition, has lead to an increased need for products with an optimal cost-performance ratio. Target Costing is the most established method to support the development of competitive products in relation to the market price. With this method, a cost target is defined in the beginning of the development of a new product. Further on, from the beginning of conceptual design, every decision within the product development process has to be scrutinized with regard to meeting the cost target. Thus multiple conceptual and detail design alternatives for both the product and its manufacturing processes have to be considered. The employees in the product development process have to be provided with knowledge of future costs of possible design alternatives. This allows them to choose the most favourable option. The target costing process can work only if these requirements are complied to in a company. How does the value engineering process function in the companies? What is the current status of cost evaluation during the product development process in small and medium sized enterprises (SME)? What difficulties do engineers deal with in the value engineering process in different departments? The investigation of these questions led to the survey that is described in this contribution.     «

Progressive globalization combined with stronger competition, has lead to an increased need for products with an optimal cost-performance ratio. Target Costing is the most established method to support the development of competitive products in relation to the market price. With this method, a cost target is defined in the beginning of the development of a new product. Further on, from the beginning of conceptual design, every decision within the product development process has to be scrutinized...     »