Kaizen costing
Kaizen costing pursues continuous, incremental reductions in production costs throughout a product's life. It relies on frequent small improvements by front-line workers rather than periodic large-scale redesigns.
FrameworkKaizen
See it move
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Target costing engineers cost out of a product at the design stage, before manufacturing begins. Kaizen costing operates afterwards, once the design is largely fixed, pursuing small, frequent improvements from front-line workers period by period. Each period's actual savings become the new, lower cost baseline for the next.
Where it fits
SubjectCost AccountingAdvancedTopicPricing & Cost ManagementAdvancedTopicStrategic & Lean Cost ManagementAdvanced