Our Two-tier Process
Phase I – Needs Analysis. – Perform a Needs Analysis to determine status of cost accounting and shop floor reporting. The Needs Analysis includes a proposed Implementation.
Phase II – Implementation. – Develop and implement improved cost accounting metrics, enhanced shop floor reporting procedures and/or document production procedures based on Needs Analysis.
Top Six Tasks Performed in Phase II
1. Basic tune-up of existing cost accounting
2. Major tune-up of existing estimating protocol
3. Overhaul existing cost accounting
4. Enhance daily shop floor reporting
5. Manufacturing/shop floor software procedure documentation
6. Develop and Implement an Economic Value Added (EVA)™ model
Typical Considerations for Improving Cost Accounting Metrics
- Chart of Accounts
- Realized yield measurement
- Overhead expense categorization
- Overhead rate allocation design
- Cost of sales determination
- Cost of manufacturing determination
- RM, WIP & FGDS inventory valuation
- Indirect expenses identification & measurement
- Identification, tracking & measurement of Direct Labor (DL)
- Identification, tracking & measurement of Direct Material (DM)
Typical Questions for Enhancing Shop Floor Reporting
- Who sets operator targets?
- How are production operator targets set?
- Current status of operator reporting?
- Production operation documentation?
- Inventory levels and capacity?
- Is there an accurate daily scrap report?
- Daily operator efficiency reporting?
- Optimum level for operator reporting detail?
- Management intervention feedback loop status?
Shop Floor Software Procedure Documentation Elements & Issues
- Status of daily transactions in & out of software system
- Level of computer literacy & system training among employees
- Status of software use for RM, WIP & FGDS inventory valuation
- Status & usage of RFQ forms, formats, sophistication, documentation
- Identification/documentation of when/who does which critical task