Designing for cost In an aerospace company

Companies take different approaches, and achieve different degrees of implementation, in designing products for cost. This thesis discusses Target Costing and its application at The Boeing Company. Target Costing is a design for cost framework that is widely used by auto manufacturers, but is still less widely used in the aerospace industry. This thesis observes the current state at The Boeing Company and provides recommendations for full implementation of Target Costing. Through research into best practices at companies that have implemented Target Costing, this thesis identifies five key enablers: culture, organizations involved, process, tools, and market. Additionally, this thesis discusses a potential barrier to implementation: organizational politics. Based on a project to implement a price visibility tool and on three value engineering case studies, this thesis identifies The Boeing Company's state relative to full scale Target Costing and provides recommendations for The Boeing Company to achieve full implementation of Target Costing through the use of the five key enablers.

Department dc:contributor.department

Leaders for Global Operations Program at MIT

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2014

Author dc:creator

• Hammar, Elizabeth (Elizabeth Deming)

Advisor dc:contributor.advisor

• Brian L. Wardle and Roy Welsch.

• Sloan School of Management.
• Aeronautics and Astronautics.
• Leaders for Global Operations Program.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/90771

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/90771