1. MANAGERIAL IMPLICATIONS OF TARGET COSTING Muhammad Hafiz Bin Shamsul Akmal A148215 Perakaunan Kos

2. Introduction This article was written by Marilyn M. Helms, Lawrence P. Ettkin, Joe T. Baxter, and Matthew W. Gordon (2005), “Managerial implications of target costing”, Competitiveness Review: An International Business Journal, Vol 15 lss 1 pp. 49 – 56. How target costing work, example of successfully companies in implementing it and the implementation challenges.

3. Characteristic Contradicts the traditional approach Intense customer focus Cost control from the beginning and at all phases of product life cycle Product, manufacturing and delivery design simultaneously

5. How it works ? Selecting suppliers Design modifications Outsourcing

6. Barriers of Applying Target Costing Lack of Understanding of the method Team and Cross functional barriers Fear of the effects Production detail

7. List of Succesful Companies Using Target Costing Japan a.Toyota Motor b.Nissan c.Daihatsu Non-Japan a.Goodyear b.Rockwell c.Dell

8. Benefit From Target Costing Cost optimization Reduced developmet cycle Collaboration between cross functional and suppliers

9. Conclusion The objective of target costing is to ensure that a firm achieves its product-specific and firm-wide profit objectives in a very highly competitive market environment. It is becoming increasingly important as more and more firms are realizing that they cannot raise prices to solve cost and profit squeeze problem. Target costing requires a major change in mindset for many companies