Target costing or Genka Kikaku, as originally named in Japan, is not only a tool for managing costs, but a strategic approach for development of new products, that aims to reduce costs, ensuring quality, reliability and other attributes that will add value to the customers. This paper presents a framework that summarizes a product development process with the literal application of target costing, and seeks to compare this framework to three implementations of it in the construction industry. It started with elaboration of a flowchart that allowed the definition of the parameters to be used in the analysis. Results show that none of the cases studied covers a completed target costing implementation as envisioned in manufacture. Finally, this work points out some issues that need further development such as studies about alternative ways of obtaining the target cost – based on the current market price instead of historical data.
target costing, target cost, cost management, value engineering
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Reference in APA 7th edition format:
Jacomit, A. M., Granja, A. D. & Picchi, F. A.. (2008). Target Costing Research Analysis: Reflections for Construction Industry Implementation. In Tzortzopoulos, P., & Kagioglou, M. (Eds.), 16th Annual Conference of the International Group for Lean Construction (pp. 601–612).
Shortened reference for use in IGLC papers:
Jacomit, A. M., Granja, A. D. & Picchi, F. A.. (2008). Target Costing Research Analysis: Reflections for Construction Industry Implementation. IGLC16.