Knocking on Industry’s Door: Needs in Product-Cost Optimization in the Early Product Life Cycle Stages

Abstract

Abstract. While theoretical concepts for product-costing methodologies have evolved over the decades, little emphasis has been placed on their integration into modern information systems. During a co-innovation workshop at SAP SE, we initiated our collaborative research with selected large-scale enterprises from the discrete manufacturing industry. Moreover, we conducted interviews with business experts to gain a sophisticated understanding of the cost-optimization process itself. As a result, we present an exemplary optimization process with an emphasis on the specific characteristics of the product development stage. Based upon this example, we identified associated deficits in information system support. No current software fulfills the enterprises' requirements regarding cost optimization in the early stages of a product's life cycle. Thus, the respective processes lack integration in corporate environments. Taking this on, our article compiles detailed problem identification and, moreover, suggests approaches to overcome these hurdles.

An Approach to Transforming Requirements into Evaluable UI Design for Contextual Practice - A Design Science Research Perspective

“…The purpose of this paper is to draft and discuss a processual approach to develop evaluable UI prototypes to enhance practical research collaborations. This practical research collaboration is important for the problem solution, as product costing has a strong focus on expert knowledge [5], [23]. Moreover, industrial practice is the most important source of information for cost optimization projects [24].…”

“…Linking this fact to the idea of product cost optimization to ensure economic success, it becomes obvious that product development phases offer the most potential to optimize product costs. Despite this immense potential, there is a lack of information system (IS) support for product cost optimization during product development [3], [4], [5].…”

“…In our long-term research project, we aim to improve IS support for product cost optimization during product development and, therefore, aid the industry in making use of the cost optimization potential. Due to the practical relevance of the research problem and the demand for new IS approaches within the industry [4], [5], we initiated a research project together with the software corporation SAP SE. The resulting research collaboration, which includes various international companies, is framed by a design science research (DSR) approach [6].…”

“…The resulting research collaboration, which includes various international companies, is framed by a design science research (DSR) approach [6]. First, we worked out a detailed problem identification together with companies among the discrete manufacturing industry [4], [5]. To overcome the identified problems, we elaborated major implementation challenges and requirements, which were further transferred into a requirements model [1].…”

“…Though there are IS available that aim at supporting product cost calculation during product development [12], a lack of functionality and the demand for enhancements has been identified [3]. Building on this, in our initial research steps, we identified missing support for early product cost optimization and the resulting drawbacks for the industry [4], [5]. To establish a substantiated foundation for further research activities in a DSR context [13], we elaborated and evaluated a requirements model with experts from international companies within the discrete manufacturing industry [1].…”