PCM is not just software
it’s a Strategic Business Initiative
The benefits of a systematic product cost management (PCM) program are significant, yet many manufacturers struggle to implement these initiatives effectively:
Your Engineering Managers are given target product cost guidelines, but no tools to understand the true cost impact of their product design decisions. As a result, new product designs are released to manufacturing over original target costs and with potential manufacturability issues that have yet to be discovered.
Your Value Engineers are tasked with reducing the cost of products after they are in production. Yet, they have no tools to understand how their ideas truly impact product cost. To validate their ideas, they send their best engineering concepts to their manufacturing team or out to a supplier for a quotation — adding days or weeks to their own process.
Your Sourcing Professionals are tasked with managing outsourced product costs. However, they have very little insight into what their product should cost before they send new designs out to bid. They are faced with asking for arbitrary discounts which do not take into consideration the should cost of the part and the supplier margin.
When your Cost Engineering team is asked to develop a quote for new customer business, it is often a painstaking process to build up the quote that requires significant manual inputs and manufacturing expertise. This results in delays responding to the customer that can often mean losing the business.
To learn more about how aPriori can help you define the right Product Cost Management strategy, contact us at ProductCost@apriori.com to arrange for a private appointment with one of our consultants.Contact Us