Journal article
Cost of not maintaining a product configuration system
Department of Mechanical Engineering, Technical University of Denmark1
Engineering Design and Product Development, Department of Mechanical Engineering, Technical University of Denmark2
Operations Management, Management Science, Department of Technology, Management and Economics, Technical University of Denmark3
Management Science, Department of Technology, Management and Economics, Technical University of Denmark4
Department of Technology, Management and Economics, Technical University of Denmark5
This article investigates the cost implications of using a not sufficiently maintained product configuration system (PCS). A case study is conducted to investigate the financial loss due to poor data quality in products sold through a not-maintained PCS. We calculated the financial loss by comparing the quotations generated by the not-maintained PCS and the quotations for the same product when the PCS was updated.
The results indicate that the company has been selling the products with a miscalculated 20% lower cost than the actual one. Comparing this financial loss to the cost required to keep the PCS up-to-date, we show that the former is significantly higher than the latter. The research concludes that the realized success and benefits of utilizing a PCS are related to its maintenance and data quality.
| Language: | English |
|---|---|
| Year: | 2018 |
| Pages: | 205-214 |
| ISSN: | 2683345x and 22172661 |
| Types: | Journal article |
| DOI: | 10.24867/IJIEM-2018-4-205 |
| ORCIDs: | Rasmussen, Jeppe Bredahl , Myrodia, Anna , Hvam, Lars and Mortensen, Niels Henrik |
