from the Perspective of Competitive Advantage
Edwin B. Dean
Yoshikawa, T., J. Innes, and F. Mitchell (1990) note that cost tables have been used extensively by Japanese companies to reduce cost. Cost tables were first applied within the manufacturing process to estimate the cost prior to implementation. Today they are used extensively within the design process where there is even more leverage for cost reduction.
A cost table is a computerized multidimensional data base in which cost is captured for several levels of a number of attributes for either the parts or functions of a product. For example, if they wish to improve certain attributes of a function, the cost table is used to estimate the cost of the improved function. It is thus a powerful tool for function cost analysis as used within their value engineering process.
The cost table is an example of parametric accounting which was proposed by Dean (1989c) for used in the USA, obviously, long after it's existence in Japan. If one were to use this data base to derive equations which predicted the data well, the resulting equations could be used for parametric cost analysis.
Although I do not yet have supporting evidence, I strongly suspect that cost tables are a primary tool within cost deployment. They would serve the same purpose as proposed by Dean (1995b).
Table of Contents | Cost Technologies | Use