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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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    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.
    4. Folgado, R. & Peças, P. & Henriques, E., 2010. "Life cycle cost for technology selection: A Case study in the manufacturing of injection moulds," International Journal of Production Economics, Elsevier, vol. 128(1), pages 368-378, November.
    5. Akamphon, Sappinandana & Sukkasi, Sittha & Boonyongmaneerat, Yuttanant, 2012. "Reduction of zinc consumption with enhanced corrosion protection in hot-dip galvanized coatings: A process-based cost analysis," Resources, Conservation & Recycling, Elsevier, vol. 58(C), pages 1-7.
    6. Knofius, N. & van der Heijden, M.C. & Zijm, W.H.M., 2019. "Consolidating spare parts for asset maintenance with additive manufacturing," International Journal of Production Economics, Elsevier, vol. 208(C), pages 269-280.
    7. Duffner, Fabian & Mauler, Lukas & Wentker, Marc & Leker, Jens & Winter, Martin, 2021. "Large-scale automotive battery cell manufacturing: Analyzing strategic and operational effects on manufacturing costs," International Journal of Production Economics, Elsevier, vol. 232(C).
    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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