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Quantifying the effects of parts consolidation and development costs on material selection decisions: A process-based costing approach

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  • Johnson, Michael
  • Kirchain, Randolph

Abstract

Product designers must continually assess trade-offs among various performance attributes and cost. Materials choice can play an important role in that decision-making process. Materials affect many aspects of a product and firm--architecture, manufacture, and product performance. This paper examines the interrelationship of these early stage design choices through the application of process-based cost modeling. To capture the far-ranging effects of materials selection, models are presented which forecast the costs of development, manufacture, and assembly. A case study is detailed concerning two alternative material options for an automotive instrument panel beam: a conventional design (i.e., stamped steel) and a die-cast magnesium design which affords significant parts consolidation. Results indicate that parts consolidation led to both lower assembly and development costs. These cost reductions are shown to be a direct result of the consolidation of parts in the magnesium design.

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  • Johnson, Michael & Kirchain, Randolph, 2009. "Quantifying the effects of parts consolidation and development costs on material selection decisions: A process-based costing approach," International Journal of Production Economics, Elsevier, vol. 119(1), pages 174-186, May.
    • Handle: RePEc:eee:proeco:v:119:y:2009:i:1:p:174-186
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    References listed on IDEAS

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    Cited by:

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    2. Johnson, Michael D. & Kirchain, Randolph E., 2009. "Quantifying the effects of product family decisions on material selection: A process-based costing approach," International Journal of Production Economics, Elsevier, vol. 120(2), pages 653-668, August.
    3. Christophe Combemale & Kate S Whitefoot & Laurence Ales & Erica R H Fuchs, 2021. "Not all technological change is equal: how the separability of tasks mediates the effect of technology change on skill demand [Patterns of industrial innovation]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 30(6), pages 1361-1387.
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    8. Shahriar, Ali & Khandoker, Azad & Gessl, Guido & Sint, Sabine & Hamid, M.A. & Tariq, Abrar & Rahman, Al, 2022. "Predicting the unpredictable: General Aviation (GA) aircraft cost estimation evaluation," Journal of Air Transport Management, Elsevier, vol. 102(C).

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