This title slide features the main topic "Product Cost Optimisation Process – Theory and Practice." Its subtitle introduces the objectives, process phases, roles, and collaboration.

Product Cost Optimisation Process

– Theory and Practice

Introduction to Objectives, Process Phases, Roles, and Collaboration

Source: Title Slide

The slide outlines a presentation agenda on cost optimization, beginning with Introduction & Theory, Phases of the Process, and Departmental Roles. It continues with Collaboration Model, Case Example, and Conclusion, including key takeaways and next steps.

Presentation Agenda

1. Introduction & Theory

Concept, objectives, theories like value analysis, and strategic importance.

2. Phases of the Process

Stages from Preparation to Closing with objectives, tools, deliverables.

3. Departmental Roles

Responsibilities of Sales, SteeCo, Product Mgmt, Cost Mgmt, Controlling, Lead.

4. Collaboration Model

Interdepartmental interactions for decision-making and cost control.

5. Case Example

Brief case study demonstrating successful cost optimisation practice.

6. Conclusion

Key takeaways, summary, and next steps for implementation. Source: Product Cost Optimisation Process – Theory and Practice

This section header slide marks Section 01: "Introduction & Theory." Its subtitle provides an overview of product cost optimisation concepts and objectives.

01

Introduction & Theory

Overview of product cost optimisation concepts and objectives.

The slide "Concept and Objectives" outlines key goals for cost reduction. It focuses on maintaining quality, achieving competitive pricing, boosting profitability and market position, and aligning with business strategy.

Concept and Objectives

• Reduce product costs while maintaining quality
• Achieve competitive pricing
• Improve profitability and market position
• Align with business strategy

The slide on Key Cost Management Theories covers Value Analysis, which eliminates waste by assessing product functions, and Target Costing, which sets market-driven targets by subtracting profit from selling price. It also details Lifecycle Cost Management, evaluating total costs across design to disposal phases, and its strategic role in ensuring profitability, innovation, and market leadership.

Key Cost Management Theories

This section header slide, titled "Product Cost Optimisation Process – Theory and Practice," introduces Section 02: "Phases of the Process." It highlights detailed stages from Preparation to Closing.

Product Cost Optimisation Process – Theory and Practice

02

Phases of the Process

Detailed stages from Preparation to Closing

Source: Phases of the Process section

The slide outlines a six-month timeline for a cost optimization process from January to June 2024. It progresses through preparation and scope definition, competitor benchmarking, detailed unit cost reporting, action plan execution, KPI monitoring, and a lessons-learned review.

Process Phases Timeline

2024-01: Preparation: Define Scope and Tools Define project scope, select tools and methodologies for effective cost optimisation analysis. 2024-02: Market Analysis: Competitor Benchmarking Conduct competitor benchmarking to identify cost structures, pricing, and market positioning opportunities. 2024-03: Unit Cost Report: Detailed Costing Develop detailed unit cost report breaking down materials, labor, and overhead components. 2024-04: Implementation: Action Plans Execution Execute targeted action plans to realise identified cost reduction opportunities. 2024-05: Monitoring: Track Key KPIs Continuously track KPIs to measure cost savings and performance against targets. 2024-06: Closing: Lessons Learned Review Document achievements, challenges, and lessons learned for future optimisation initiatives.

Source: Product Cost Optimisation Process – Theory and Practice

This table outlines project phases—Prep, Market, Cost Report, Impl, Monitor, and Close—with corresponding objectives, tools, and deliverables. Key examples include scope definition via workshops yielding a charter in Prep, benchmarking with surveys for a report in Market, and tracking via dashboards for KPIs in Monitor.

Objectives, Tools & Deliverables

{ "headers": [ "Phase", "Objectives", "Tools", "Deliverables" ], "rows": [ [ "Prep", "Scope def.", "Workshops", "Charter" ], [ "Market", "Benchmark", "Surveys", "Report" ], [ "Cost Report", "Analyze", "ABC", "Unit costs" ], [ "Impl", "Execute", "PM tools", "Savings plan" ], [ "Monitor", "Track", "Dashboards", "KPIs" ], [ "Close", "Review", "Audits", "Final report" ] ] }

This section header slide introduces Section 03: Departmental Roles within the Product Cost Optimisation Process – Theory and Practice presentation. It offers an overview of roles and responsibilities for the involved departments.

Product Cost Optimisation Process – Theory and Practice

03

Departmental Roles

Overview of roles and responsibilities for involved departments.

Source: Departmental Roles section

The slide "Key Departments & Responsibilities" outlines six core teams in a cost optimization process via a feature grid. Sales provides market insights, SteeCo handles approvals, Product Mgmt sets strategy, Cost Mgmt performs analysis, Controlling tracks performance, and Program Lead coordinates execution.

Key Departments & Responsibilities

{ "features": [ { "icon": "📈", "heading": "Sales: Market Input", "description": "Provides essential market insights and pricing inputs for cost decisions." }, { "icon": "✅", "heading": "SteeCo: Approvals", "description": "Manages governance, approvals, and strategic oversight throughout the process." }, { "icon": "🎯", "heading": "Product Mgmt: Strategy", "description": "Defines product specifications, strategy, and optimization targets." }, { "icon": "🔍", "heading": "Cost Mgmt: Analysis", "description": "Conducts detailed cost analysis using specialized tools and methods." }, { "icon": "📊", "heading": "Controlling: Tracking", "description": "Monitors financial performance and tracks cost optimisation progress." }, { "icon": "🔗", "heading": "Program Lead: Coordination", "description": "Coordinates departments, timelines, and ensures seamless process execution." } ] }

The Collaboration Model workflow outlines five phases of a process, specifying primary owners and key collaborators for each. It starts with Sales leading initiation and market analysis (with Product Management), progresses through SteeCo review, Cost Team Report, Implementation (involving all departments), and ends with Monitoring & Closing led by the Program Lead (with all departments).

Collaboration Model

{ "headers": [ "Phase", "Primary Owner", "Collaborators" ], "rows": [ [ "Sales Initiation & Market Analysis", "Sales", "Product Management" ], [ "SteeCo Review", "SteeCo", "Sales, Product Management" ], [ "Cost Team Report", "Product Cost Management", "Controlling" ], [ "Implementation", "Product/Controlling", "All Departments" ], [ "Monitoring & Closing", "Program Lead", "All Departments" ] ] }

Source: Product Cost Optimisation Process

This slide presents a case example from an automotive supplier facing a 15% cost overrun on a key project, addressed through target costing and value analysis. The actions yielded a 12% cost reduction and faster time-to-market, with the key lesson being the essential role of cross-departmental collaboration.

Case Example: Automotive Supplier

• Challenge: 15% cost overrun on key project.
• Actions: Applied target costing + value analysis.
• Results: 12% cost reduction; faster time-to-market.
• Lesson: Cross-departmental collaboration essential.

The slide's key takeaways emphasize mastering theory and practice for cost excellence, implementing processes through strong collaboration, and inviting Q&A. Its subtitle motivates achieving cost excellence together.

Key Takeaways & Next Steps

• Master theory & practice for cost excellence

• Implement process with strong collaboration
• Q&A

Achieve cost excellence together!

Source: Product Cost Optimisation Process – Theory and Practice