Title: Modelling trade-offs in design-accompanying life cycle cost calculation

Authors: David Mueller

Addresses: Department of Business Administration, Technical University Ilmenau, PF 100 565, Ilmenau 98684, Germany

Abstract: It is becoming increasingly important to integrate into cost calculation processes, all costs throughout a product|s development and life span. Cost performance in design, manufacture, operation and disposal is associated with several intertemporal trade-offs – a subject about which there has been little research. This paper (1) highlights the main trade-offs in product design, (2) models unidirectional and bidirectional trade-offs between product design and later life cycle stages and (3) presents a profit-maximising solution for these trade-offs. The model|s approach enables the assignment of changing costs in manufacturing, operation and disposal in relation to their dependency on development decisions, ensuring appropriate unidirectional and bidirectional trade-offs. It shows that neglecting these trade-offs may lead to weak design decisions. This new model will enforce the accountants| contribution to successful product design.

Keywords: design-accompanying cost calculations; product design; profit maximising solutions; unidirectional trade-offs; bidirectional trade-offs; life cycle costing; product life cycle.

DOI: 10.1504/IJPLM.2009.031677

International Journal of Product Lifecycle Management, 2009 Vol.4 No.1/2/3, pp.290 - 310

Received: 28 Mar 2009
Accepted: 25 Nov 2009

Published online: 17 Feb 2010 *

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