Dedicated Costing Resources: Major product lines are organized into individual business units. Some of the larger business units created positions within their product operations teams that were dedicated to cost modeling and estimating services. However, the company also recognized that a centralized 'technology & quality' team was needed to provide expert support to the business units during times of peak demand, and also provide cost modeling and estimating services for the smaller business units that did not have the resources to fund their own dedicated cost team. The new technology & quality team was located at corporate headquarters, and was responsible for selecting, configuring, and maintaining the cost management platform leveraged by all members of the product design, costing, and sourcing teams. The team was also responsible for developing an integration strategy and tools that facilitate the process of managing cost estimate requests from the product design teams, tracking cost savings and working with the buyers to help ensure they were maximizing their should-cost data. In addition to the central costing team at corporate headquarters, a dedicated engineering service team was set up in India to help support day-to-day cost modeling tasks and cost estimation requests. The mechanical design and engineering teams are constantly working on new product initiatives. Target cost for these new products are set by the product marketing team. The target cost for a product is in most cases broken down to the functional level. When the product design team has achieved a sufficient percentage of design definition, a request is sent to the cost engineering team. The request is analyzed by the senior manager of engineering operations, and routed to the proper resource in the cost engineering service team for detailed analysis. The cost engineering service team handles 3-5 projects per week, with most projects consisting of assemblies that have 20 or more individual components to be analyzed. Using aPriori, a detailed cost estimate including all of the primary manufacturing operations and any secondary operations that may be required, such as plating, heat treatments, etc., is generated very quickly for each part. The cost of all components is rolled up into a fully cost bill of materials (cBOM) for the product assembly that includes any mechanical assembly operations.
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