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How can you be sure you are making smart decisions about new products without understanding their cost impact? If you’re an executive making decisions related to future strategic or business plans, your plans need to be driven by predictive financial or commercial data. The challenge is to bring all the related cost, product and production data together to make the right decisions at the right time, early in a product or program lifecycle.
With 80 percent of a product’s costs determined in the first 20 percent of the product lifecycle (DARPA study), you can’t rely on enterprise resource planning (ERP) for product cost analysis, because by then it’s too late. You have already made your product decisions and committed the correlating costs in product development to establish what can be achieved for key new product introduction (NPI) metrics such as economic value added (EVA), free cash flow (FCF) and net present value (NPV). Instead, you need to look ahead to predict product costs, estimate tooling and capital investments, and anticipate profit forecasts for NPI, early in your process.
Once you’ve made these early decisions, you need to make sure you stay aligned with them. If you’re using standalone spreadsheets, you’re working with disconnected data that’s hard to keep up-to-date, and you can never be sure where you stand on the targets that will ensure your success.
Instead of relying on traditional methods for cost engineering, why not use the same product lifecycle management (PLM) system you use to manage product development to predict and control product costs from the very beginning of the product lifecycle?
Teamcenter solutions for product cost management provide you with a unique opportunity to create a unified product lifecycle costing strategy. Teamcenter not only touches all areas of the product lifecycle, but it can also offer product cost analysis and estimation at a much deeper level where the product “DNA” is captured and re-used as a corporate asset for competitive advantage. You can close the loop for continuous improvement, value engineering and the best practice of rolling NPI forecasts with improved product cost management.
With Teamcenter, all of the rich product lifecycle data is in one logical repository. Whether it’s for quotation costing, purchase price analysis, or understanding the cost of a change, you can use the Teamcenter product costing solution (formerly known as Perfect ProCalc) to efficiently analyze costs and optimize resources effectively. You can make NPI investment decisions based on accurate cost estimates, early in the product lifecycle. With Teamcenter product costing and PLM processes, your cross-functional product teams can make smarter decisions that lead to better products – from early product planning throughout the product lifecycle – to reduce risk and increase the profitability of your products.
You can use Teamcenter product costing as a cost engineering solution for individual departments or as a holistic enterprise solution for the optimization of cross-functional product cost management. The product costing knowledge built into Teamcenter provides a consistent standard that significantly increases the transparency, quality and efficiency of your company-wide costing processes.
In addition, a specific Teamcenter tool costing solution (formerly known as Perfect CalCard) provides up-to-date, reliable costing both when generating quotes and analyzing costs in the procurement of tools. Both users and makers of tools – whether it’s injection molding, die casting, cutting-stamping or other types of manufacturing tools – can make tooling cost decisions that are fully integrated within the Teamcenter product cost management solution.
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