A TEMPLATE FOR IMPLEMENTING TARGET COSTING
Abstract (Summary)
The Consortium for Advanced Management- International (CAM-I) defines target costing as a profit planning and cost management system that is price led, customer focused, design centered and cross functional. Target costing initiates cost management at the earliest stages of product development and applies it throughout the product's life cycle by actively involving the entire value chain. Six key principles that describe the major tenets of target costing are: 1. price-led costing, 2. focus on customers, 3. focus on design, 4. cross-functional teams, 5. value-chain involvement,and 6. lifecycle cost reduction.
