What is cost analysis


All methods of cost analysis serve to create transparency and determine the cost drivers.

 

Every improvement project is based on knowledge of the relevant cost structures and sensitivity to changes and fluctuations. This information is provided by the methods of cost analysis.

Goals of the cost analysis

 

    • Generate transparency about cost structures

 

    • Identify cost drivers

 

    • Recognize the influence of fluctuations on the respective cost items

 

    • Optimize the use of limited (employee) resources

 

    • Provide basis for price calculation

 

background

 

Activities or improvement projects often start without a reliable database of price and cost drivers being available. This is fundamentally important for any product or process development or business process planning. There are also cases in which the additional effort, e.g. for a special solution, is estimated in order to determine the sales price. As a result, limited resources are often used “uneconomically” or products are not offered at cost.

 

Cost analysis - methods and tools

 

There are a number of methods that use cost analyzes in different ways. Here is a small excerpt

    1. Pareto analysis

 

    1. ABC analysis

 

    1. Process cost analysis

 

    1. target costing

 

    1. Value analysis

 

    1. Cost allocation procedure

 

 

Experience with cost analysis

 

Cost analyzes are the basis in all of our projects. Transparency about costs and cost drivers effectively prevent undesirable developments or miscalculations that ultimately affect the company's competitiveness. The corresponding openness towards the employees about real costs ensures understanding and acceptance even in the case of initially critically questioned decisions.

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At this point, we would like to refer you to our extensive range of training courses and further education. Use the time and the freed up capacities of your employees for their qualified further education. We have adapted our online and webinar offerings accordingly. Seize this opportunity and return strengthened from the current situation on the road to success. Below you will find our training courses and the corresponding dates. Contact us. We look forward to you!

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