Most OEM manufacturers have been recasting their supply networks; reducing numbers of small accounts, buying subassemblies, kits and integrated systems. Economies of scale and reduced overhead costs have been cited as benefits but seldom measured. Recent work has shown that cost reduction cannot be assumed; indeed new costs appear to have been incurred through some of the new practices. What is needed is a thorough search technique to locate where the costs lie. The paper describes early experiences with a search process operated for suppliers and OEM's on a clinic basis. It includes routines for locating: structural overcost (multiple layers, sites, overhead additions and hourly rate deviations), design overhead - NVA features in designs, material and processing cost excess, and NVA overhead costs; quality costs, excess assembly, rework, logistical costs. The main advantages in the process are its ability to investigate overhead costs rationally, a powerful design evaluation tool and the unique cost structure analysis tool.


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    Title :

    Radical cost reduction in the supply chain; finding the big cost obstacles


    Additional title:

    Radikale Kostensenkung in der Zulieferkette - Suche nach den großen Kostenfaktoren


    Contributors:
    Foyer, P. (author)


    Publication date :

    1994


    Size :

    8 Seiten, 4 Bilder, 1 Tabelle



    Type of media :

    Conference paper


    Type of material :

    Print


    Language :

    English




    Radical Cost Reduction in the Supply Chain: Finding the Big Cost Obstacles

    Foyer, P. / ENEA; Agency: Italy | British Library Conference Proceedings | 1994


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