Target costing and BPR

This topic has 1 reply, 2 voices, and was last updated 14 years ago by Ken Garrett.

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April 6, 2012 at 5:56 pm #52137
taiwodarams83
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Good afternoon,

Here is my question:

The use of Target costing would invariably lead to cost gap as a result of difference between estimated cost and the target cost.

Would it be reasonable to say techniques such BPR could be used to close this gap?

Thank you.
April 6, 2012 at 9:30 pm #96116
Ken Garrett
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Well, a cost gap isn’t inevitable. However, if actual cost is above target then BPR might bea way of closing the gap (production efficiency increased). Another way would be to simplify the product through value analysis.
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