Saturday 13 August 2011

Continuous improvement (Kaizen) costing

calls for establishing cost reduction targets for products or services that an organization is currently providing to customers.

Developed in Japan, this approach to cost management is often referred to as Kaizen costing.

Kaizen means "continuous improvement" in Japanese.

Continuous improvement costing begins where target costing ends.

Target costing takes a proactive approach to cost management during the conception, design, and pre - production stages of a product's life; continuous improvement costing takes a proactive approach to cost management during the production stage of a product's life:

Successful companies use continuous improvement costing to avoid complacency. Competitors are constantly striving to win market share through better quality or lower prices.

No comments:

Post a Comment