Standard product specification
A standard product specification states the required characteristics of a product, such as its materials, dimensions, functionality and quality. It provides a basis for determining the resource requirements used in a standard cost, alongside technical methods and operating assumptions. A bill of materials details the components and quantities; the product specification is broader. An agreed specification supports consistent costing and quality assessment, but changes must be authorised and reflected in relevant standards.
Worked example
A chair specification requires a stated load capacity, dimensions and finish. Its bill of materials lists timber, fasteners and coating quantities. Changing the timber to reduce cost requires checking that the revised chair still meets the performance and safety requirements.
Common mistake
Treating a bill of materials as the complete product specification or reducing cost without checking required quality.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | MA | Direct | September 2026–June 2027 |
| ACCA | PM | Direct | September 2026–June 2027 |
| FIA | FMA | Direct | September 2026–June 2027 |