Improving Cost Effectiveness in an Existing Product Line Using Component Product Platforms

2008 ◽  
Author(s):  
Ronald S. Farrell ◽  
Timothy W. Simpson
Keyword(s):  
Cost Effective ◽  
Product Line ◽  
New Method ◽  
Product Platform ◽  
Abc Model ◽  
Customer Requirements ◽  
Activity Based Costing ◽  
Product Platforms ◽  
Volume Product ◽  
The Cost

Previously, we introduced a new method for improving commonality in a highly customized, low volume product line using component product platforms. The method provides a bottom-up platform approach to redesign family members originally developed one-at-a-time to meet specific customer requirements. In this paper, we extend the method with an Activity-Based Costing (ABC) model to specifically capture the manufacturing costs in the product line, including the cost associated with implementing a platform strategy. The valve yoke example is revisited in this paper, the customized ABC model is defined, two design strategy alternatives are addressed, and the new method is used to determine which alternative is better at resolving the tradeoff between commonality, total cost, and product performance. The proposed method shows promise for creating a product platform portfolio from a set of candidate component platforms that is most cost-effective within an existing product line. The proposed method allows for arbitrary leveraging as it does not rely solely on the traditional vertical, horizontal, or beachhead strategies advocated for the market segmentation grid, and this is especially beneficial when applied to an existing product line that was develop one-at-a-time time such that artifact designs are inconsistent from one to another.

scholarly journals The cost of immunising at the general practice level

2009 ◽  
Vol 1 (4) ◽  
pp. 286 ◽  
Author(s):  
Nikki Turner ◽  
Paul Rouse ◽  
Stacey Airey ◽  
Helen Petousis-Harris
Keyword(s):  
General Practice ◽  
Cost Allocation ◽  
Cost Model ◽  
Cost Effective ◽  
Fee For Service ◽  
Activity Based Costing ◽  
Childhood Immunisation ◽  
Practice Nurses ◽  
The Mean ◽  
The Cost

INTRODUCTION: Childhood immunisation is one of the most cost-effective activities in health care. However, New Zealand (NZ) has failed to achieve national coverage targets. NZ general practice is the primary site of service delivery and is funded on a fee-for-service basis for delivery of immunisation events. AIM: To determine the average cost to a general practice of delivering childhood immunisation events and to develop a cost model for the typical practice. METHODS: A purposeful selection of 24 diverse practices provided data via questionnaires and a daily log over a week. Costs were modelled using activity-based costing. RESULTS: The mean time spent on an immunisation activity was 23.8 minutes, with 90.7% of all staff time provided by practice nurses. Only 2% of the total time recorded was spent on childhood immunisation opportunistic activities. Practice nurses spent 15% of their total work time on immunisation activity. The mean estimated cost per vaccination event was $25.90; however, there was considerable variability across practices. A ‘typical practice’ model was developed to better understand costs at different levels of activity. CONCLUSIONS: The current level of immunisation benefit subsidy is considerably lower than the cost of a standard vaccination event, although there is wide variability across practices. The costs of delivery exceeding the subsidy may be one reason why there is an apparently small amount of time spent on extra opportunistic activities and a barrier to increasing efforts to raise immunisation rates. KEYWORDS: Immunisation; vaccination; patient care management; cost analysis; cost allocation

A Prototype Web-Based Custom Product Specification System

2003 ◽  
Author(s):  
Ronald S. Farrell ◽  
Gary Stump ◽  
Jaeil Park ◽  
Timothy W. Simpson
Keyword(s):  
Design Process ◽  
A Priori ◽  
Cost Effective ◽  
Product Variety ◽  
Product Line ◽  
Web Based ◽  
Product Platforms ◽  
Design Interfaces ◽  
Infinite Variety ◽  
Product Specification

For companies who must provide customized products on demand, it is important that the voice of the customer be addressed and incorporated early into the design process. Web-based design interfaces have emerged as useful tools to make customer voices interactive and provide a customer-friendly and cost-effective interface. The effectiveness of the interface can be greatly enhanced through implementation of a strategic customization process that can proactively react to customer requests. The design process represents a virtual product line that approaches the goal of providing infinite variety at minimal costs. The process provides a base for a true customization approach, which is different from the typical mass customization approach to provide ample but limited product variety a priori for a targeted market. In this paper, we describe the development of a prototypical custom product specification system and the underlying strategic design process that is based on a collection of product platforms. The development is illustrated using an example from on-going research with a company that produces customized valves for the power industry.

scholarly journals Comparison Between Individually and Group-Based Insulin Pump Initiation by Time-Driven Activity-Based Costing

2017 ◽  
Vol 11 (4) ◽  
pp. 759-765 ◽  
Author(s):  
Martin Ridderstråle
Keyword(s):  
Insulin Pump ◽  
Cost Effective ◽  
Insulin Pump Therapy ◽  
Individual Treatment ◽  
Cost Curve ◽  
Activity Based Costing ◽  
Pump Therapy ◽  
Medical Quality ◽  
Group Basis ◽  
The Cost

Background: Depending on available resources, competencies, and pedagogic preference, initiation of insulin pump therapy can be performed on either an individual or a group basis. Here we compared the two models with respect to resources used. Methods: Time-driven activity-based costing (TDABC) was used to compare initiating insulin pump treatment in groups (GT) to individual treatment (IT). Activities and cost drivers were identified, timed, or estimated at location. Medical quality and patient satisfaction were assumed to be noninferior and were not measured. Results: GT was about 30% less time-consuming and 17% less cost driving per patient and activity compared to IT. As a batch driver (16 patients in one group) GT produced an upward jigsaw-shaped accumulative cost curve compared to the incremental increase incurred by IT. Taking the alternate cost for those not attending into account, and realizing the cost of opportunity gained, suggested that GT was cost neutral already when 5 of 16 patients attended, and that a second group could be initiated at no additional cost as the attendance rate reached 15:1. Conclusions: We found TDABC to be effective in comparing treatment alternatives, improving cost control and decision making. Everything else being equal, if the setup is available, our data suggest that initiating insulin pump treatment in groups is far more cost effective than on an individual basis and that TDABC may be used to find the balance point.

Enbridge Cost and Schedule Contingency Assessments

2012 ◽  
Author(s):  
Matthew Schoenhardt ◽  
Vachel Pardais ◽  
Cheryl Fortin ◽  
Brent Kitson ◽  
Jay Hanzel
Keyword(s):  
Board Of Directors ◽  
Cost Effective ◽  
Business Environment ◽  
Parametric Modeling ◽  
Cost Estimate ◽  
New Method ◽  
Parametric Modelling ◽  
Risk And Uncertainty ◽  
Capital Projects ◽  
The Cost

All capital projects have an element of risk and uncertainty. In today’s business environment this requires more than just simply adding 10 percent contingency to the cost estimate to cover off project unknowns. Before sanctioning a project for hundreds of millions of dollars, Board of Directors need to know what possible cost and schedule outcomes exist in order to safe-guard shareholders’ investments. Contingency assessments must be: • Risk-based • Project Specific • Repeatable • Defendable • Cost effective Six years ago, Enbridge grappled with these issues and realized it needed to adopt a new method of assessing both cost and schedule contingencies. After evaluating options, Enbridge set upon developing an in-house parametric modeling solution for its contingency assessment needs. This paper will: • Identify various options for assessing contingency • Review the Enbridge process • Demonstrate the value of a simplified risk register • Identify required data inputs • Illustrate calibration and accuracy of assessments • Discuss business advantages of parametric modelling

INTER-FIRM PRODUCT PLATFORM DEVELOPMENT IN THE AUTOMOTIVE INDUSTRY

2005 ◽  
Vol 09 (02) ◽  
pp. 155-181 ◽  
Author(s):  
MAGNUS LUNDBÄCK ◽  
CHRISTER KARLSSON
Keyword(s):  
Economies Of Scale ◽  
Critical Factor ◽  
Cost Effective ◽  
General Interest ◽  
Product Platform ◽  
Product Platforms ◽  
Platform Architecture ◽  
Development Processes ◽  
Platform Development ◽  
Product Platform Development

The product platform development process becomes critical and of general interest when different brand name products are developed from inter-firm developed product platforms. The inter-firm platform adds perspectives not considered in previous research. In this article areas related to the inter-firm product platform integration process are described. The study is a longitudinal, deep, explorative study aimed at identifying managerial challenges to inter-firm platform development and how they can be dealt with. Analysis shows that the factory sequence is a critical factor when developing inter-firm platform architecture. Also, making architectural concessions without jeopardising brand uniqueness places new demands on managers involved in the development processes. Further, we found a reciprocal interdependence between technological and managerial factors that created a need for innovative organisational and managerial solutions. Finally, reciprocal interdependences add complementary theoretical knowledge on how to better control and understand areas that hamper inter-firm product development projects from attaining cost-effective solutions and economies of scale.

Minimal-Contact Versus Standard Cognitive Behavioral Therapy for Irritable Bowel Syndrome: Cost-Effectiveness Results of a Multisite Trial

2021 ◽  
Author(s):  
Laura J Dunlap ◽  
James Jaccard ◽  
Jeffrey M Lackner
Keyword(s):  
Irritable Bowel Syndrome ◽  
Cost Effectiveness ◽  
Behavioral Therapy ◽  
Cost Effective ◽  
Symptom Improvement ◽  
Activity Based Costing ◽  
Patient Cost ◽  
Minimal Contact ◽  
Irritable Bowel ◽  
The Cost

Abstract Background Irritable bowel syndrome (IBS) is a common, often disabling gastrointestinal (GI) disorder for which there is no satisfactory medical treatment but is responsive to cognitive behavior therapy (CBT). Purpose To evaluate the costs and cost-effectiveness of a minimal contact version of CBT (MC-CBT) condition for N = 145 for IBS relative to a standard, clinic-based CBT (S-CBT; N = 146) and a nonspecific comparator emphasizing education/support (EDU; N = 145). Method We estimated the per-patient cost of each treatment condition using an activity-based costing approach that allowed us to identify and estimate costs for specific components of each intervention as well as the overall total costs. Using simple means analysis and multiple regression models, we estimated the incremental effectiveness of MC-CBT relative to S-CBT and EDU. We then evaluated the cost-effectiveness of MC-CBT relative to these alternatives for selected outcomes at immediate posttreatment and 6 months posttreatment, using both an intent-to-treatment and per-protocol methodology. Key outcomes included scores on the Clinical Global Impressions-Improvement Scale and the percentage of patients who positively responded to treatment. Results The average per-patient cost of delivering MC-CBT was $348, which was significantly less than the cost of S-CBT ($644) and EDU ($457) (p < .01). Furthermore, MC-CBT produced better average patient outcomes at immediate and 6 months posttreatment relative to S-CBT and EDU (p < .01). The current findings indicated that MC-CBT is a cost-effective option relative to S-CBT and EDU. Conclusion As predicted, MC-CBT was delivered at a lower cost per patient than S-CBT and performed better over time on the primary outcome of global IBS symptom improvement.

scholarly journals The Reflection of the application TD-ABC approach on profits persistence Applied study in the General State of Hydraulic Industries Factory of Plastic*

2019 ◽  
Vol 25 (116) ◽  
pp. 226-261
Author(s):  
Sabiha Barzan Alubaidy
Keyword(s):  
Traditional Method ◽  
Indirect Costs ◽  
Cost Effective ◽  
Research Problem ◽  
Activity Based Costing ◽  
Use Of Time ◽  
Applied Study ◽  
Definition Of ◽  
The Cost ◽  
The Impact

The interest of many companies has become dealing with the tools and methods that reduce the costs as one of the most important factors of successful companies, and became the subject of the attention of many economic units because of the impact on the profits of company, and since the nineties of the last century the researchers and writers gave great attention to this subject, especially in light of the large competition and rapid developments in cost management techniques, as well as the wide and significant change in production methods that have been directed towards achieving customer satisfaction, all this and more driven by economic units in all sectors whether it is service or productivity to find methods that would reduce the costs and thereby increase the profits. As well as achieving a market share compared to economic units operating in the same sector. This study seeks to apply the method of reducing the manufacturing factory overhead costs through the use of time-driven activity-based costing. The aim of the research is to use this technique and to determine the effect of this method in measuring the profit persistence of the company. The traditional method used in the company the research sample to determine the indirect costs and the extent of its impact on the measurement of the profit persistence, the definition of the concepts and characteristics of the method of cost-based activity and the cost method based on time-driven activity and justifications applied to companies, so, the research problem was that the traditional method used by the company the research sample in determining manufacturing factory overhead costs is not fair and objective as it builds the actual basis for determining manufacturing factory overhead costs at the level of the factory as a whole. Consequently, it does not represent cost-effective information that reflects the cost-effectiveness of the plant in the sample of the research and in a manner that affects the profitability of the company the research sample and thus in measuring the profit persistence.

scholarly journals Strategic Capacity Management With Modular Manufacturing And Outsourcing: A Case Study

2011 ◽  
Vol 4 (4) ◽  
Author(s):  
Ignacio Garcia ◽  
Ray Venkataraman
Keyword(s):  
Business Strategy ◽  
Net Present Value ◽  
Cost Model ◽  
Flow Analysis ◽  
Cost Effective ◽  
Product Line ◽  
Fixed Costs ◽  
Course Of Action ◽  
The Cost

<p class="MsoBodyTextIndent2" style="text-align: justify; line-height: normal; text-indent: 0in; margin: 0in 34.2pt 0pt 0.5in;"><span style="font-family: &quot;Times New Roman&quot;,&quot;serif&quot;; font-size: 10pt; mso-bidi-font-style: italic;">This paper proposes that downsizing an industrial manufacturer&rsquo;s capacity is a cost-effective strategy to reduce the cost of conversion while ensuring that adequate capacity is available to meet its business strategy requirements. A case study of a U.S. manufacturer of motors and other mechanical drive systems illustrates a proposed reduction in capacity that utilizes the development and implementation of a cost model to determine the best alternatives for a company whose capacity is not synchronized with its business strategy. The cost model for each alternative is investigated and compared against the &lsquo;Do nothing&rsquo; alternative, using net present value and cash flow analysis to build a case for the most effective course of action. The findings show the benefits of merging manufacturing by separating people, non-people, and fixed costs by facility, product line and product. In addition, the paper also illustrates the benefits of modular manufacturing and outsourcing as a way to further improve costs after the reduction of capacity.<span style="mso-spacerun: yes;">&nbsp; </span></span></p>

The Use of Activity-Based Costing, Uncertainty, and Disassembly Action Charts in Demanufacture Cost Assessments

1995 ◽  
Author(s):  
Bert Bras ◽  
Jan Emblemsvåg
Keyword(s):  
Numerical Simulation ◽  
Cost Model ◽  
Simulation Technique ◽  
Design Parameters ◽  
Abc Model ◽  
Activity Based Costing ◽  
Monte Carlo Simulation Technique ◽  
The Cost ◽  
A Company ◽  
Numerical Simulation Technique

Abstract In this paper, the development of an Activity-based Cost (ABC) model is presented for use in design for demanufacture under the presence of uncertainty. Demanufacture is defined as the process opposite to manufacturing involved in recycling materials and product components after a product has been taken back by a company. The crux in developing an ABC model is to identify the activities that will be present in the demanufacturing process of a product, and afterwards assign reliable cost drivers and associated consumption intensities to the activities. Uncertainty distributions are assigned to the numbers used in the calculations, representing the inherent uncertainty in the model. The effect of the uncertainty on the cost and model behavior are found by employing a numerical simulation technique — the Monte Carlo simulation technique. The additional use of disassembly action charts allows the influence of the uncertainty to be traced through the cost model to specific demanufacture process and product design parameters.

Effective Product Family Design Using Physical Programming and the Product Platform Concept Exploration Method

2000 ◽  
Author(s):  
Achille Messac ◽  
Michael P. Martinez ◽  
Timothy W. Simpson
Keyword(s):  
Product Family ◽  
Product Platform ◽  
The Novel ◽  
Customer Requirements ◽  
Product Family Design ◽  
Physical Programming ◽  
Product Platforms ◽  
Concept Exploration ◽  
Effective Product ◽  
Performance Gains

Abstract In an effort to produce more variety for today’s highly competitive market, companies are designing and developing families of products — groups of related products derived from common product platforms — to simultaneously satisfy multiple customer requirements. After reviewing the state of the art in product family and product platform design, we describe the Product Platform Concept Exploration Method (PPCEM) for designing common product platforms that can be scaled or “stretched” into a suitable family of products. This paper extends previous work by the authors through the novel integration of physical programming within the PPCEM to enable the product family design problem to be formulated using physically meaningful terms and preferences. The design of a family of universal electric motors is presented to demonstrate the effectiveness of the proposed approach. Performance gains are achieved in the motor family by utilizing physical programming within the PPCEM when compared to previous results.

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