Ratio project planning: cost optimization projects in the production phase

Abstract

Nowadays, cost reduction, without compromising the quality and functionality of products, is a strategic issue for most companies. Therefore, companies must have adequate cost management systems and be prepared to implement cost reduction plans in order to maintain the desired levels of profitability. Many companies perform cost reduction initiatives in the form of a project, involving the necessary departments and employees to work towards a specific target cost or cost reduction goal. This research is on product cost optimization projects applied by companies that follow a lean approach. The studied company, a first-Tier supplier of the automotive industry, developed a cost reduction methodology to be applied in the production phase named Ratio Project Planning (RPP). This methodology was analysed from a project management perspective. To turn it more effective and efficient, a dashboard that includes the performance indicators regarding RPP was developed and implemented. This tool supports decision-making, allowing real-Time monitoring and better management of the whole process.