THE USE OF ACTIVITY-BASED COSTING
1995 ASME Advances in Design Automation Conference, Boston, Massachusetts, Sept. 17-20, 1995.
THE USE OF ACTIVITY-BASED COSTING, UNCERTAINTY, AND DISASSEMBLY ACTION CHARTS IN DEMANUFACTURE COST ASSESSMENTS
Bert Bras and Jan Emblemsvåg The Systems Realization Laboratory The George W. Woodruff School of Mechanical Engineering Georgia Institute of Technology Atlanta, Georgia 30332-0405
ABSTRACT In this paper, the development of an Activity-based Cost (ABC) model is presented for use in design for demanufacture under the presence of uncertainty. Demanufacture is defined as the process opposite to manufacturing involved in recycling materials and product components after a product has been taken back by a company. The crux in developing an ABC model is to identify the activities that will be present in the demanufacturing process of a product, and afterwards assign reliable cost drivers and associated consumption intensities to the activities. Uncertainty distributions are assigned to the numbers used in the calculations, representing the inherent uncertainty in the model. The effect of the uncertainty on the cost and model behavior are found by employing a numerical simulation technique - the Monte Carlo simulation technique. The additional use of disassembly action charts allows the influence of the uncertainty to be traced through the cost model to specific demanufacture process and product design parameters. OUR FRAME OF REFERENCE The growing importance of including environmental issues in design has amplified the impetus for companies to more formally consider the entire life-cycle of a product, from cradle to grave or even to reincarnation through recycling and reuse. A crucial issue is the assessment of costs (or profit) related to pursuing environmentally benign products and processes. We believe that in order to provide efficient and effective decision support in life-cycle design, costing methods should: 1) Assess and trace costs and revenues; 2)
THE USE OF ACTIVITY-BASED COSTING, UNCERTAINTY, AND DISASSEMBLY ACTION CHARTS IN DEMANUFACTURE COST ASSESSMENTS
Bert Bras and Jan Emblemsvåg The Systems Realization Laboratory The George W. Woodruff School of Mechanical Engineering Georgia Institute of Technology Atlanta, Georgia 30332-0405
ABSTRACT In this paper, the development of an Activity-based Cost (ABC) model is presented for use in design for demanufacture under the presence of uncertainty. Demanufacture is defined as the process opposite to manufacturing involved in recycling materials and product components after a product has been taken back by a company. The crux in developing an ABC model is to identify the activities that will be present in the demanufacturing process of a product, and afterwards assign reliable cost drivers and associated consumption intensities to the activities. Uncertainty distributions are assigned to the numbers used in the calculations, representing the inherent uncertainty in the model. The effect of the uncertainty on the cost and model behavior are found by employing a numerical simulation technique - the Monte Carlo simulation technique. The additional use of disassembly action charts allows the influence of the uncertainty to be traced through the cost model to specific demanufacture process and product design parameters. OUR FRAME OF REFERENCE The growing importance of including environmental issues in design has amplified the impetus for companies to more formally consider the entire life-cycle of a product, from cradle to grave or even to reincarnation through recycling and reuse. A crucial issue is the assessment of costs (or profit) related to pursuing environmentally benign products and processes. We believe that in order to provide efficient and effective decision support in life-cycle design, costing methods should: 1) Assess and trace costs and revenues; 2)
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