Hitting the Target: The CAM-I Target Costing Implementation Guid

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In an increasingly competitive world, companies are realizing that managing costs after products are in production is too late.

In an increasingly competitive world, companies are realizing that managing costs after products are in production is too late. They understand that cost management must begin before products ever reach the production stage. This is why CAM-I’s book Target Costing: The Next Frontier in Strategic Cost Management, with its message of designing costs out of products and processes, was so well received by the corporate world. Most companies understood and accepted the message; many, however, had difficulty implementing the process.

is a companion to CAM-I’s Target Costing published in 1997. It focuses on implementation issues and is meant for readers who are familiar with target costing and want to take it to the next level. Introducing the target costing techniquerequires more than getting the technical aspects right.  This book addresses often overlooked tasks such as handling, managing, and leading organizational change.  Change management and people issues are at the forefront of this book. This guide uses a simple three stage framework to depict implementation as a movement from knowing about a new technique, to doing it in practice, and then being or institutionalizing the practice so it becomes a part of the organizational fabric.

The change management backdrop does not blur the book’s focus on technical issues in implementing target costing. There is a detailed discussion of team formation, team building, team charters, training, curricula, tools, supplier involvement, and other pertinent topics. The book allows readers to immerse themselves in detailed implementation planning without forgetting that target costing is scalable to smaller organizations. Not every company needs a cast of thousands to implement target costing, nor do they need to acquire all the tools and training that larger companies may need. Another key message of this book is that full implementation of target costing takes time. Large companies may need the sophisticated tools and training but not on the first day, month or even year. Maturity in target costing is a long term path, and a company can move toward world class status slowly and still reap major benefits on route to their destination.

Target costing has been a successful strategic weapon for many US, Japanese, and European companies.  We hope that the readers of this book will reap some of the same benefits as their peers.

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