Functional cost analysis (FSA, A activity B settled C osting, ABC) is a technology that allows you to evaluate the real value of a product or service, regardless of the organizational structure of the company. Both direct and indirect costs are allocated to products and services depending on the amount of resources required at each stage of production. The actions performed at these stages, in the context of the FSA method, are called functions (activities).
The purpose of the FSA is to ensure the correct allocation of funds allocated for the production of products or the provision of services, according to direct and indirect costs. This allows for the most realistic assessment of the company's costs.
Essentially, the FSA method works according to the following algorithm:
- Does the market dictate the price level or is it possible to set the price of products that will give the planned profit?
- Should the projected premium on FSA costs be applied equally across all operations, or do some functions generate more revenue than others?
- how does the final selling price of products compare with FSA indicators?
Thus, using this method, you can quickly estimate the amount of profit expected from the production of a particular product or service.
If the original cost estimate is correct, then income (before taxes) will be equal to the difference between the selling price and the costs calculated using the FSA method. In addition, it will immediately become clear which products or services will be unprofitable (their selling price will be lower than the estimated costs). Based on this data, you can quickly take corrective actions, including revising business goals and strategies for the coming periods.
Reasons for the appearance of FSA
The FSA method appeared in the 80s, when traditional methods of cost calculation began to lose their relevance. The latter appeared and developed at the turn of the last and the century before last (1870 - 1920). But since the early 1960s, and especially in the 1980s, changes in the way we manufacture and do business have led to traditional cost accounting being labeled "enemy number one for manufacturing" because its usefulness has become highly questionable.Traditional cost estimation methods were originally developed (according to GAAP standards based on the principles of "objectivity, verifiability and significance") for the evaluation of inventories and were intended for external consumers - creditors, investors, the Securities Commission ( S economy E xchange C ommission), Internal Revenue Service ( I internal R evening S service).
However, these methods have a number of weaknesses, especially noticeable when internal management. Of these, the two biggest drawbacks are:
- The impossibility of accurately conveying the costs of producing a particular product.
- Failure to provide feedback- information for managers necessary for operational management.
As a result, managers of companies selling various types of products accept important decisions concerning price setting, product combination and production technology, based on inaccurate cost information.
So decide contemporary issues Functional cost analysis was called upon, and it ended up being one of the most important innovations in management in the last hundred years.
The developers of the method, Harvard University professors Robin Cooper and Robert Kaplan, identified three independent, but in concert, factors that are the main reasons for the practical application of the FSA:
- The process of structuring costs has changed very significantly. And if at the beginning of the century labor labor was about 50% of general expenses, material cost is 35% and overhead is 15%, now overhead is about 60%, materials is 30%, and labor is only 10% of production cost. It is clear that using working hours as a basis for allocating costs made sense 90 years ago, but with modern structure costs have already lost their force.
- The level of competition that most companies face has increased tremendously. "A rapidly changing global competitive environment" is not a cliché, but a very real nuisance for most firms. Knowing the actual costs is very important to survive in such a situation.
- The cost of performing measurements and calculations has declined as information processing technologies have advanced. Even 20 years ago, the collection, processing and analysis of the data needed for the FSA were very expensive. And today not only special automated systems evaluation data, but also the data itself, which is usually already collected and in one form or another and stored in each company.
In this regard, the FSA can be a very valuable method, since it provides information on the full range of operational functions, their cost and consumption.
Difference from traditional methods
Under traditional financial and accounting methods, a company's performance is valued by functional operations rather than by services provided to the customer. The calculation of the effectiveness of a functional unit is made according to the execution of the budget, regardless of whether it benefits the client of the company. In contrast, functional cost analysis is a process management tool that measures the cost of performing a service. The assessment is carried out both for functions that increase the value of a service or product, and taking into account additional functions that do not change this value. If traditional methods calculate the costs of a certain type of activity only by categories of expenses, then the FCA shows the cost of performing all process steps. FSA explores all possible functions in order to determine the most accurate cost of providing services, as well as to ensure the possibility of upgrading processes and increasing productivity.
Here are three main differences between FSA and traditional methods (see Figure 1):
- Traditional accounting assumes that cost objects consume resources, while in FSA it is assumed that cost objects consume functions.
- Traditional accounting uses quantitative indicators as the basis for allocating costs, while FSA uses sources of costs at various levels.
- Traditional accounting is focused on the structure of production, while the FSA is focused on processes (functions).
Rice. 1. Main differences between FSA and traditional cost accounting methods
The direction of the arrows is different, as the FSA provides detailed information about the processes for cost estimation and performance management at multiple levels. And traditional cost accounting methods simply allocate costs to cost objects, without taking into account cause and effect relationships.
So traditional cost accounting systems focus on the product. All costs are attributed to the product, since it is believed that the manufacture of each element of the product consumes a certain amount of resources proportional to the volume of production. Therefore, the quantitative parameters of the product are used as cost sources for calculating overhead costs ( working time, machine hours, cost of materials, etc.).
However, quantitative indicators do not allow taking into account the diversity of products in terms of size and complexity of manufacture. In addition, they do not reveal a direct relationship between the level of expenditure and the volume of production.
The FSA method uses a different approach. Here, the costs of performing individual functions are first determined. And then, depending on the degree of influence of various functions on the manufacture of a particular product, these costs are correlated with the production of all products. Therefore, when calculating overhead costs, functional parameters such as equipment setup time, number of design changes, number of processing processes, etc. are also taken into account as cost sources.
Consequently, the more functional parameters there are, the more detailed the production chain will be described and, accordingly, the real cost of production will be more accurately estimated.
Another important difference between traditional cost estimation systems and FSA is the scope of functions. In traditional inventory valuation methods, only internal production costs are tracked. The FSA theory does not agree with this approach, believing that when calculating the cost of a product, all functions should be taken into account - both those related to production support and the delivery of goods and services to the consumer. Examples of such functions include: production, technology development, logistics, distribution, service, information support, financial administration and general management.
Traditional economic theory and financial management systems consider costs as variables only in the case of short-term fluctuations in production volumes. Value-for-money theory suggests that many important price categories also fluctuate over long periods (several years) as the design, composition, and range of a company's products and customers change.
Table 1 compares the FSA and traditional cost accounting methods.
Table 1. FCA and Traditional Cost Accounting Methods
| FSA | Traditional Methods | Explanation |
| Feature Consumption | Resource consumption | Traditional accounting methods are based on the assumption that prices can be controlled, but as the practice of most managers has shown, this is practically impossible. The theory of functional cost analysis recognizes that only what is produced can be controlled, and prices change as a result. The advantage of the FSA approach is that it provides a wider range of measures to improve business performance. In a systematic study of the functions performed, not only the factors affecting the increase or decrease in productivity are revealed, but also the incorrect allocation of resources is detected. Therefore, in order to reduce costs, it is possible to rationally allocate capacities and achieve more high performance than the traditional way. |
| Sources of costs at different levels | Quantitative cost allocation bases | As overhead costs rise, new technologies emerge, and of course, allocating costs based on 5-15% (as in most companies) of total total costs is too risky. In fact, errors can reach several hundred percent. In functional cost analysis, costs are distributed in accordance with cause-and-effect relationships between functions and cost objects. These links are fixed with the help of cost sources. In practice, the sources of costs are divided into several levels. Here are the most important ones:
|
| Process orientation | Structural Orientation | Traditional costing systems focus more on the organizational structure than on the existing process. They cannot answer the question: "What should be done?" because they do not know anything about the process. They have only information about the availability of resources needed to do the job. And the process-oriented method of FCA gives managers the opportunity to most accurately match resource requirements and available capacities, and therefore increase productivity. |
FSA application. Example
Mispricing of products occurs in almost all companies involved in the production or sale of a large number of goods or the provision of various services. To understand why this happens, consider two hypothetical factories that produce simple items - ballpoint pens. Factory #1 produces a million blue pens every year. Factory #2 also produces blue pens, but only 100,000 a year. In order for the production to operate at full capacity, as well as to ensure the employment of personnel and extract the necessary profit, plant No. 2, in addition to blue pens, produces a number of similar products: 60 thousand black pens, 12 thousand red pens, 10 thousand purple pens, etc. Plant No. 2 usually produces up to a thousand various kinds goods, the volumes of which range from 500 to 100 thousand units. So, the total output of plant No. 2 is equal to one million products. This value coincides with the volume of production of plant No. 1, so they require the same number of labor and machine hours, they have the same material costs. However, despite the similarity of goods and the same volume of production, an outside observer can notice significant differences. Plant #2 has more staff to support production. There are employees involved in:
- equipment management and configuration;
- checking products after setting;
- receiving and checking incoming materials and parts;
- movement of stocks, collection and shipment of orders, their fast forwarding;
- processing of defective products;
- design and implementation of design changes;
- negotiations with suppliers;
- planning the receipt of materials and parts;
- modernization and programming of a much larger (than the first plant) computer information system).
Factory #2 has more high performance downtime, overtime, warehouse overload, rework and waste. A large workforce supporting the production process, as well as a general inefficiency in the production technology of products, leads to a discrepancy in prices.
Most companies calculate the cost of running such a production process in two stages. First, the costs associated with certain categories of responsibility (responsibility centers) are taken into account - production management, quality control, receipts, etc. - and then these costs are associated with the relevant departments of the company. Many firms are very good at implementing this stage. But here's the second step, where the costs of the divisions should be distributed to specific products, is performed too simplistic. Until now, working hours are often used as the basis for calculation. In other cases, two more additional bases are taken into account for calculation. Material costs (expenses for the purchase, receipt, verification and storage of materials) are allocated directly to products in the form of a percentage premium to direct material costs. In highly automated plants, machine hours (processing time) are also taken into account.
Regardless of whether one or all of these approaches are used, the cost of producing high-volume items (blue handles) is always significantly higher than the cost of producing the same item in the first plant. Blue pens, representing 10% of production, will require 10% of the cost. Accordingly, purple pens, the output of which will be 1%, will require 1% of the cost. In fact, if the standard costs of labor and machine hours, materials per unit of production are the same for both blue and purple pens (ordered, produced, packaged and shipped in much smaller volumes), then the overhead costs per unit of goods for purple there will be more pens.
Over time, the market price for blue pens (produced in the highest volumes) will be determined by more successful manufacturers specializing in the production of this product (for example, plant No. 1). The managers of Plant #2 will find that the profit margins for blue handles will be lower than those for specialty products. The price of blue pens is lower than purple pens, but the cost estimation system invariably calculates that blue pens are just as expensive to produce as purple pens.
Frustrated by low profits, Plant 2's managers are content to produce a full range of products. Customers are willing to pay more for specialty items such as purple pens, which are obviously not nearly as expensive to produce as regular blue pens. What, logically, should be the strategic step in response to this situation? It is necessary to downplay the role of blue handles and offer an expanded set of differentiated products, with unique properties and opportunities.
In fact, such a strategy would be detrimental. Despite the results of the costing system, the production of blue pens at the second plant is cheaper than purple. Reducing the production of blue pens and replacing them with newer models will further increase overhead costs. The managers of the second plant will be deeply disappointed, as total costs will increase, and the goal of increasing profitability will not be achieved.
Many managers realize that their accounting systems are misrepresenting the value of an item, so they make informal adjustments to compensate for this. However, the example described above clearly demonstrates that few managers can predict specific adjustments and their subsequent impact on production in advance.
Only a system of functional cost analysis can help them in this, which will not give distorted information and disorienting strategic ideas.
Advantages and disadvantages of functional cost analysis compared to traditional methods
In conclusion, we present the final list of the advantages and disadvantages of the FSA.
Advantages
- A more accurate knowledge of the cost of products makes it possible to make the right strategic decisions on:
- a) setting prices for products;
b) the right combination of products;
c) the choice between the ability to make one's own or purchase;
d) investing in research and development, process automation, promotion, etc. - Greater clarity about the functions performed, through which companies are able to:
- a) pay more attention to managerial functions, such as improving the efficiency of high-value operations;
b) identify and reduce the volume of operations that do not add value to products.
- The feature description process can be overly detailed, and the model is sometimes too complex and difficult to maintain.
- Often the stage of collecting data on data sources by functions (activity drivers) is underestimated
- For high-quality implementation, special software tools are required.
- The model often becomes outdated due to organizational changes.
- The implementation is often seen as an unnecessary "whim" financial management is not sufficiently supported by operational management.
Footnotes
Source of costs (cost driver) - a process (function) occurring at the stage of production of a product or service, which requires material costs from the company. A cost source is always assigned a quantity.
For example, with the disclosure of the structure of the activities of divisions, or at the level of the main stages of production
FUNCTIONAL-COST ANALYSIS1
General information
Functional cost analysis is a method of technical and economicengineering
analysis,
directed
on the
increase (preservation) of the functional usefulness of the object
while minimizing the cost of its creation and operation.
The subject of FSA is the function of the object under study.
FSA is a universal high-performance
method for optimizing parameters and other design,
technological, organizational, aesthetic, economic
characteristics of the product according to the accepted criterion (criteria). AT
quality
main
criteria
speaks
defined
in a special way the ratio of consumer properties to
cost unit.
2
FSA principles
1) a functional approach that involves considerationeach object and its components as an implementation option (or
planned for implementation) a set of functions required
consumer, and finding on this basis the most effective
ways to implement these functions;
2) an integrated approach, meaning the consideration of an object with
terms of design, production, transportation,
operation, disposal ( life cycle);
3) a systematic approach, meaning the consideration of an object as
system, divided into subsystems, and functions - as
system-wide and intra-system, internal communications object like
direct and reverse;
4) the principle of hierarchy, which implies a gradual
detailing the analyzed functions and costs for individual
components of the object of the 1st, 2nd, n-th order;
3
FSA principles
5)principlecollective
scientific and technical
creativity, involving widespread use in FSA
methods
collective
creativity,
special
methods,
activation of creative thinking;
6) the principle of coordination, meaning the compliance of the phased
goals and objectives of the FSA to the main stages of research, pre-production,
quality management;
7)principle
strictly
regulated
the sequence of the individual stages and
sub-stages of the FSA, creating conditions for their formalization and
partial automation;
8) the principle of continuous economic evaluation of all
technical and organizational, managerial proposals;
4
FSA principles
9)principlespecial
informational
and
organizational support, involving the creation
special services of the FSA, additional information
security;
10) the principle of the variety of methods used in
FSA (FAST method, brainstorming, morphological
analysis, trend, prioritization method, scoring method, method
expert assessments, black box method, correlation method
functions – König graph, etc.).
5
FSA methods
FAST method - systematic analysis methodfunctions; contributes to the ordering of functions and the construction
function diagrams (such as network graphics), allows
check the correctness of the wording and classification
functions using a system of logical tests.
Brainstorming is a method of activating creative
thinking, used to get a lot of
original ideas in a short amount of time.
The brainstorming procedure is carried out according to special
rules, the duration of one session is 40-60 minutes.
Used to solve problems of different levels
structuring.
6
FSA methods
TRIZ is the theory of inventive problem solving.Used when searching for original technical solutions,
focusing developers on the maximum approximation to
ideal end result.
Provides heuristic search algorithm
solutions, various characteristics of the product. Costs for
production of a new product is determined by substitution
values of the parameters of the designed product into the formula
mathematical model.
7
functional analysis
Functional analysis is the basis of the methodologyFSA.
It is a tool for identifying
necessary
consumer
properties
object
and
possibilities for its improvement.
The cost of production is ultimately the cost
functions. If some functions are not used, then the costs
they become useless.
The principle of the functional approach, which is
the basis of the FSA is a complete understanding, precise definition and
function analysis.
8
functional analysis
Functional analysis includes:identification and formulation of functions for certain
rules
their classification,
construction functional models,
determination of costs,
establishing
consumer,
values
functions
selection of functions for research.
9
With
taking into account
opinions
functional analysis
Despite the huge variety of products,the number of functions performed by them is many times less.
For example, in combine harvester about 30 thousand parts,
and the number of functions performed by them is two orders of magnitude less.
Evaluation of functions is reduced to two indicators -
utility and aesthetics. Functional analysis proceeds
from the fact that useful functions in the analyzed object
are always accompanied by neutral (auxiliary) and
harmful (useless) functions.
10
Most important rule– function statement
should be sufficiently general, not limited to
specific subject.
For example, a chair, stools, armchairs, benches have one
the general useful function is to "hold the weight".
Functions are formulated taking into account the purpose of the object.
For example, electric lamp incandescent in
table lamp, in addition to the useful function of "radiate
light”, also performs the harmful function of “radiate heat”.
When using the same lamp in an incubator, the function
"radiate heat" would be beneficial, and "radiate light" would be neutral.
11
Principles and rules for formulating functions
To formulate a function, you need to choose a verb,describing the action.
In the function statement
characteristics of the object.
not
must
enter
For example, the function of a bicycle frame is “hold
details”, and not “ensure the rigidity of the structure”, because
rigidity is already a characteristic. Better wording
give functions in a nutshell - verb in indefinite
form and a noun in the accusative case.
Function electric wire- "to conduct current"
car - "move the load." Should not be consumed
particle "not".
12
13
Classification of functions and their ranking
The main function is a useful function that reflectsthe purpose of the object (the purpose of its creation). For example, a chair
must "support the weight", the screwdriver - "transmit torque
moment". Other functions of these objects can be
classified as secondary.
Example. The main function of the glasses is to "focus the light".
Additional function - "protect the eye" from hit
particles. This function does not affect the main one, but creates
additional consumer properties.
14
Classification of functions and their ranking
The main function provides execution of the main function.There may be several main functions. Main functions
provide performance.
There are main functions:
- reception;
- input (substance, energy, information);
- transfers;
- transformations;
- storage;
- issuance.
15
Classification of functions and their ranking
Helper functions are functions thatsupport the main. If the main function can be
implemented without any function from the original
list of the main ones, then this function is not the main one, but
auxiliary.
There are the following auxiliary functions:
- connecting;
- insulating;
- fixing;
- guide;
- guaranteeing.
16
Classification of functions and their ranking
Bydegree
utility
distinguish
useful,
neutral (useless) and harmful functions.
Neutral
function
not
affects
on the
change
consumer properties.
17
Function types
- main function - reflects the action aimed atimplementation
goals
object
(systems),
for
direct satisfaction of specific end
needs;
- the main function is an action, without which the object cannot be
can provide the required consumer properties,
the existence of the main function;
- auxiliary function - an action due to
character, design features
object, caused by a specific embodiment of the main
functions. It contributes to the performance of the main functions
or complement them.
18
Function classification
19FSA stages
20FSA stages
preliminary stage. At the preliminary stagean FSA group is created, an object for analysis is selected,
problem is formulated.
Information stage. In general, this is
formation of an information bank about details like
structures, about materials and their cost, patent
research, analysis of modern technologies.
Analytical stage. At this stage, the identification
functions and their classification, compilation of matrices
relationships, identification of functional significance, choice
elements for improvement.
21
FSA stages
In addition to relationship matrices, you can use the modelfunctions in the form of a graph
F0 is the main function; F1 - F8 - basic functions; f11 - f81 - auxiliary
functions; numbers in squares mean functional blocks (elements
structures).
22
Beside
with functions, you can put down the significance in% and other information.
FSA stages
Creative stage. At this stage, options are being developedconstructive solution, the choice of the best according to
a number of criteria. Technologies are treated in the same way. At
the choice of options is made economic calculations.
The significance of each main function is calculated by
formula that takes into account the ratio of the number of bonds Si
basic
functions
(through
auxiliary)
With
functional blocks, with respect to the sum ΣSi of all
connections. For example, in fig. at the main function F1 via
Auxiliary functions have three links, while F2 has only one.
23
FSA stages
Relative costs Ci for functional blocks(elements) can be determined approximately from the assumption,
that they are proportional to the sums of the significances of the principal
functions that these blocks perform.
According to the obtained relative costs for the elements of the object, you can
construct a Pareto chart and determine those elements, the relative costs of
which in total will give approximately 80%. Work to improve these
24
elements
should be a priority.
FSA stages
recommendation stage. At this stage, finallyjustifies the choice of the option that will be selected
for further improvement. An implementation plan is being developed
project.
Implementation stage. At the implementation stage, a group is formed
implementation.
Compiled
schedule
implementation.
Requests for resources are made. Working
documentation. Incentive measures are being developed. After
completion
implementation
carry out
audit,
determine
project efficiency.
25
FSA example
Consider examples of functional analysis using the examplemanual grinder. First, it is advisable to build
component model of the object. For a meat grinder, it is given
in fig.
The levels are marked on the model: A - the object of analysis and
external, associated elements; B - elements of the upper
hierarchical level of the object.
26
FSA example
Based on the model, a relationship matrix is builtfunctions and elements (Table 9.1).
27
An example of an FSA design
For example, consider the option of conducting an FSA forsimple designs.
1. Preparatory stage. Created a group on the FSA.
Selected a product manufactured by the enterprise as a product
consumer - "Pants hanger". Design
shown schematically in Fig.
An object
consists
from
the following details: 1 -
hook; 2 - body; 3-
guide;
4
–
pin; 5 - spring
(inside clothespin).
28
An example of an FSA design
2. Information stage. The group reviewed the availablestructures and technologies for their manufacture. Comparison
showed that similar products or at cost
exceed the manufactured product, or do not provide
sufficient security of fastening.
It was decided to carry out functional analysis and
construct matrices of interconnection of functions and elements.
The main function is to hang up the pants (neatly
folded).
To execute the main function, it is necessary to execute
the following features:
- cover pants;
- create an effort;
29
- hang pants.
An example of an FSA design
3. Analytical stage. Core Relationship Matrixfunctions and elements of the hanger, taking into account the cost
parts manufacturing, analysis of significance and importance
functions, is given in table.
30
An example of an FSA design
4. Creative stage. From Table. 9.5 follow the conclusions.1. It turned out to be a very large coefficient ΣР for a simple
products.
2. The main contribution is made by: part No. 3 (P = 3.0) and part No.
2 (P=1.0), which perform auxiliary functions.
3. We must try to change the design so that
decrease
amount
details,
performing
secondary functions.
31
An example of an FSA design
At this stage, the methods of TRIZ and brainstorming were used.assault.
There are two clothespins in the design, the distance between
by which it is regulated. Maybe make one big one.
clothespin, then the guide will not be needed?
The clothespin consists of two stamped halves with
stiffeners having a common axis and a spring between
them. - Maybe make one big clothespin,
made of a bent elastic material, then the axis does not
it is necessary, and get rid of a total of six details?
The contact of the clothespin with the trousers occurs along the line. -
Can be one long clothespin made of two elastic
wires, then the contact with the trousers will be in a narrow line,
32
specific
will the pressure be greater and the mount more reliable?
An example of an FSA design
If the clothespin is made of two wires, then the end of the wiresyou can fasten and bend - you get a hook.
You can not rely only on the elasticity of the wires - not
enough clamping force. We need to come up with a simple device,
which would compress the wires and unclench them.
As a result of further discussion, it was proposed
the design option shown in Fig.
New hanger option
The trousers are made up of two parts:
1 - frame; 2 - slider.
33
An example of an FSA design
5. Research stage. For new designit is also necessary to compile a matrix of correspondence of functions and
elements (Table 9) and analyze the results.
34
An example of an FSA design
6. Recommendation stage. After a fundamental choiceoption, it is necessary to develop its parameters for
manufacturing: choose wire diameter, main dimensions
designs, choose the type of coverage, consider options
design, etc. It is necessary to prepare for the implementation of the project
design and technological documentation.
The design and technology departments submit applications for
purchase of materials. Designers of the technological department
develop tooling for frame bending, stamping
slider.
A schedule for the implementation of the project and deadlines are being developed
production of an experimental batch.
35
An example of an FSA design
7. Stage of implementation. After the production of an experimental batchproducts make amendments to the design of devices, in
technological
modes,
economists
are counting
actual
cost price
products
and
expected
economic effect in the release of a certain batch.
After economic calculations, a decision is made on
production of new products.
36
Example of FSA business processes
Example 1. The company is engaged in the implementation ofdomestic market of cosmetics, perfumery and household
chemistry
1. We identified the main business processes:
- activity planning;
- supplying the company with goods;
- sale of goods through trade divisions
companies;
- execution of financial transactions;
- analysis of the company's activities.
37
Example of FSA business processes
As a result of functional cost modelinga diagram of monthly labor costs by functions was built
(rice.).
38
Example of FSA business processes
To complete the analysis in the organizationlabor costs by department
more
appreciated
From fig. 9.7 it follows that it is necessary to distribute functions for more
uniform loading of departments. To complete the picture, managers
it would be necessary to indicate the share of loading of the main functions.
39
Example of FSA business processes
The company also estimated the cost of funds for the implementationcore functions, support and business processes and
carried out redistribution processes
It can be seen that after analysis and
transformations
increased costs
on core and business processes, and reduced
support costs
processes, which increased
efficiency
activities.
40
Application of the FSA in the organization
To complete the documents, the visitor had to go through fouroffice: No. 1 - appointment with a technical specialist, which takes 1 5 minutes;
No. 2 - the employee made entries in the journal for 10 minutes; No. 3 - Economist
performed calculations within 10 min; No. 4 - the employee accepted payment for
transactions in the amount of 100 rubles, made notes and issued a receipt, all this in
within 5 min.
The process diagram is shown in fig.
41
Application of the FSA in the organization
Total: each stream serves 15 people per day, 30 people in total.The sum of the daily payment of all visitors is 30 x 100 = 3000 rubles.
The daily salary of all specialists was 450x4 = 1800 rubles.
The daily profit from the FSA amounted to 1200 rubles.
I. Functional cost analysis……………………………….....4
1.1. The concept, essence and objects of the FSA method……………………...… 4
1.2. Principles and forms of functional cost analysis……… 8
1.3. Problems of introducing accounting according to the FSA method…………………. 13
II. Settlement part……...……………………………………………..…. fifteen
CONCLUSION………………………………………………………...…20
LIST OF USED LITERATURE……………………...…..21
INTRODUCTION
Currently, one of the ways to improve product quality and develop industrial enterprise management systems is the use of functional cost analysis (FCA). Exist different opinions on the effectiveness of the application of the FSA. Some economists consider FSA to be a simple method. For its application in practice, others are difficult, both in methodological terms and in the field of technology for the use of FSA. Perhaps this is due to the fact that there is not enough information about the experience of using the method.
The purpose of this work is to reveal the essence of functional cost analysis, as well as ways to use it to improve product quality and improve the marketing management system at the enterprise. According to these goals, the following tasks are set in the work:
- give the concept of the system according to the FSA method (ABC-cost);
- determine the scope of this method;
- evaluate the problems of introducing accounting according to the FSA method.
1.1. The concept, essence and objects of the FSA method
In the economic literature, the relationship between the marketing strategy and the FSA strategy is noted. The FSA strategy develops a marketing strategy, as it is an effective method for studying the technical and economic characteristics of goods, and their functionality.
Functional cost analysis is understood as a method of complex systematic study of the cost and characteristics of products, including the functions and resources involved in production, sales, delivery, technical support, service delivery, and quality assurance. This method is aimed at optimizing the relationship between the quality, usefulness of the object's functions and the costs of their implementation at all stages of its life cycle.
The goals of using functional cost analysis in an enterprise may vary depending on the object of study. If the object of the study is a division of the enterprise, for example, the marketing department, then the goal of the study will be to achieve improvements in the work of the department in terms of cost, labor intensity and productivity. If we consider the quality of the enterprise's products as the object of research, then the goals of the FSA will be: at the stages of research and development - to prevent the occurrence of unnecessary costs, at the stages of production and operation of the facility - to reduce or eliminate unjustified costs and losses. The ultimate goal of the FSA is to find the most economical options for a particular practical solution from the point of view of the consumer and the manufacturer.
Accordingly, the tasks of the FSA are also distinguished according to the objects of study. In the first case, the activities of the personnel of the marketing department are analyzed and the cost of performing management functions is determined, the efficiency of using the labor resources of the department is studied, sources of increasing labor productivity are identified, eliminating " bottlenecks» in management, etc. In the second case, the main tasks will be the following: reducing material consumption, labor intensity, energy intensity and capital intensity of products, improving product quality, reducing costs for improving product quality by completely or partially eliminating unnecessary costs for inefficient measures.
FSA objects can be:
Organizational and management processes and structures, building (improvement) organizational structure, distribution of tasks, rights and responsibilities in the unit management system, creation of conditions for effective work service employees;
Product quality (identifying reserves for improving product quality, achieving the optimal state of "quality - price");
Product design (at the stages of design, pre-production, directly in the manufacturing process), all types technological equipment and tools, special equipment and special materials;
Technological process (at the stages of development of technological documentation, technological preparation of production, organization and management of production), and other processes
production (preparation, processing, assembly, control, storage, transport).
Functional cost analysis allows you to perform the following types of work:
1. determine the level (or extent) of the implementation of various business processes in the enterprise, including the effectiveness of marketing management and product quality management;
2. justify the choice of a rational option for the technology for implementing business plans;
3. to analyze the functions performed by the structural divisions of the enterprise;
4. provide high quality products;
5. analyze the integrated improvement of the performance of the enterprise, etc.
In order to ensure best return From the performance of work on the FSA, it is necessary to observe a number of basic principles of analysis (Table 1.1).
1) there is no single FSA methodology suitable for all areas and all objects of research;
2) before making a decision on the application of the FSA, it is necessary to analyze the main factors influencing the process and methodology for implementing this method:
Directions for conducting FSA (enterprise management system, management system structural unit- marketing department, product quality);
The object of study and its life cycle;
Goals and objectives of the method;
The amount of funding for the study using the FSA;
Qualification of specialists conducting FSA.
The FSA theory is widely used in mechanical engineering, electrical and electronic industries. This is due to the systematic nature of the method, which lies in the fact that it requires the study of the object as a whole and as a system that includes others. constituent elements, which are in interaction, as well as parts of another system, a higher level, in which the analyzed object is in a certain relationship with other subsystems. Due to the systematic nature of the FSA, it makes it possible to identify causal relationships between quality, characteristics and costs in each object under study.
FSA specialists must have high level development of abstract thinking and creative (scientific and technical) imagination. These individual psychological characteristics contribute to an increase in the variety of alternatives in making managerial decisions.
Grouping costs by factors of production allows you to identify a hierarchical structure of directions for reducing the cost of products. It is advisable to detail the directions, ranking them according to the degree of significance, determined by the method of expert assessment. Comparison of functions with the costs of their implementation allows you to choose ways to reduce the cost of products.
Correlation specific gravity the cost of a function in the total cost and the significance of the corresponding function, allows you to calculate the cost ratio by function. It is considered optimal
. If this coefficient significantly exceeds unity (), it is necessary to look for ways to reduce the cost of this function.The result of the conducted FSA are alternative solutions that take into account the ratio of the total cost of products (which is the sum of the elemental costs) with the base costs. The minimum possible cost of the product can serve as a base. The economic efficiency of the FSA, which shows what proportion is the cost reduction in their minimum possible value, can be determined by the formula:
(1) - economic efficiency of the FSA (coefficient of reduction of current costs); - actual total costs; - the minimum possible costs corresponding to the designed product. The result of the implementation of the FSA as a tool for managing product quality should be a reduction in costs per unit of useful effect, which is achieved:
Reducing costs while improving the consumer properties of the product;
Reducing costs while maintaining the level of quality;
cost reduction with a reasonable reduction technical parameters to their functional level.
1.2. Principles and forms of functional cost analysis
Principles of functional cost analysis
Table 1.1
| FSA research object | FSA principle | The content of the FSA principle |
| Enterprise division (marketing department) | Systems approach | Analysis of the subdivision as an element of a higher order system and as a system consisting of interrelated elements |
| functional approach | Analysis of the unit as a set of functions performed | |
| Creativity | Activation of creative work on the problems of the structure and functions of the unit | |
| Product quality | Functionality | Consideration of products as a set of functions performed |
| Consistency | Study of each function of the product as an independent system | |
| economy | Analysis of costs for product functions at all stages of the product life cycle | |
| Creation | Activation of collective work on improving the quality of products |
At present, three main forms of FSA are used in domestic and foreign practice.
FSA is a method of systematic research of functions, performance of various objects and the costs of their implementation. The FSA is currently most widely used for technical objects-products, their parts and details, equipment, technological processes production. The main purpose of the analysis in this case is to identify reserves to reduce the costs of research and development, production and operation of the objects under consideration. In addition to the design and technology of technical objects, the field of activity of the FSA now includes organizational and management processes, production structures of enterprises, associations and research organizations. If we proceed from the general premise of system analysis, then any element of a complex production and economic system can be an object of the FSA National economy, which meets the requirements of the features highlighted above. The development of the FSA theory has found wide application in mechanical engineering, electrical and electronic industries. This is due to the systematic nature of the method, which sets as its task in each specific case to reveal the structure of the object under consideration, to decompose it into the simplest elements, to give them a dual assessment (from the side of use value - integral quality and from the side of the cost of research, production and operation costs). Due to its systemic nature, the FSA makes it possible to identify causal relationships between quality - operational and technical characteristics and costs in each object under study. Based on this, grounds are created for excluding mechanical methods of cost planning from the achieved level, setting standards based on the current level of labor intensity of prime cost and consumption of materials.
The advantage of FSA is the presence of fairly simple calculation and graphical methods that allow us to give a dual quantitative assessment of the identified cause-and-effect relationships. This advantage makes FSA the most effective methods for analyzing not only technical, but also production and economic systems, structures, methods of organization and planning, production management and scientific research. However, work on the FSA is carried out in isolation from economic calculations at enterprises and associations. Therefore, the economic standards of the current production are not covered by the functional approach, they are based on a substantive economic analysis, planning from the achieved level. . The methodological provisions of the FSA of products and technologies have been worked out quite deeply, they are based on the same principles, similar techniques and the same quantitative assessments.
FSA is defined as a method of complex feasibility study of the functions of an object, aimed at optimizing the ratio between the quality of performance of specified functions and the costs of their implementation. This method is sometimes referred to as use-value cost analysis. FSA is based on the assumption that in each object, system to be analyzed, both necessary in accordance with the existing development of production and unnecessary costs are concentrated. These unnecessary costs are the object of analysis, study, and finding ways to eliminate them. Excessive costs are usually associated with increased functionality of products that is not required by the consumer, or with insufficiently economical constructive, technological or organizational implementation of production. The concept of necessary and unnecessary costs are essential and important not only for technical, but also for any production and economic systems.
The FSA is based on a functional approach, in contrast to the subject approach that is currently most common in cost analysis. With the subject approach, the question is solved how to reduce the cost of an element, assembly, device or system as a whole. In the functional approach, first of all, the composition of the functions, tasks, and goals necessary for the operation of equipment or other objects is considered. Only after this, possible ways of constructive, technological or organizational implementation of elements - units and blocks of equipment, operations of a technological or production process, divisions of enterprises and associations are identified. This allows either to identify elements that do not carry a functional load in the system under consideration, or to combine the performance of various functions by the water element, the solution of several problems.
The functional-nodal design method has been used for a long time in the radio-electronic industry and a number of other branches of mechanical engineering. The functional approach in improving the organization and management of production is not used enough. In modern conditions of improving economic accounting and intensification, it should be the main one, which will simplify the production structure of industries and enterprises, eliminate unnecessary links in terms of their efficiency and target orientation both in industry as a whole and in individual production and scientific associations. .
The functional approach allows economic analysis designs and manufacturing technology of instruments and equipment from the point of view of the interests of the consumer. The consumer, in turn, is not interested in objects and products as such, but in the functions they perform. With the help of a functional approach, it is possible to more systematically and logically evaluate the links in such systemic processes as increasing production efficiency, introducing new technology and technology, specialization and cooperation of enterprises, technical re-equipment production, etc.
The central concept of FSA is the concept of functions: the external manifestation of the properties of an object in the system of relations under consideration, i.e. in a certain, specific expected or existing situation. As you know, the combination of useful properties of the product. determines its use value. Only for these beneficial features draws the attention of the consumer. Hence the connection between functional cost analysis and use value.
Use-value can be determined by one or more properties. For example, the main consumer property of spot welding is hard connection. The welded seam of the pipeline must have two important consumer properties: the specified stiffness of the joint and its tightness. complex modern equipment, radio-electronic equipment (REA) can have tens and hundreds of various consumer properties. In addition to the working properties of direct interest to the consumer, each product has aesthetic (shape, color), physiological (noise, temperature, smell, vibration, etc.) and other objective properties. Others usually include product properties that are not required by a particular consumer in the conditions under consideration. For example, the resistance of an electronic device to insects is of no interest to the developers of REA, which is intended to be used only on the territory of our country. However, the production of equipment for tropical countries makes this property one of the "workers". Or, for example, the resistance of electronic components to low negative temperatures becomes a working property only when using REA outdoors in the northern and high mountain regions. In accordance with the division of consumer properties of products into working, aesthetic, physiological and others, the main and secondary functions of the objects under consideration are distinguished. Among the secondary functions associated with the aesthetic, physiological and other properties of products, the bulk of the unnecessary costs that need to be identified and eliminated are concentrated. However, among other properties, one can find those that, under certain conditions, can satisfy the corresponding needs without additional costs.
For complex production and economic systems, it is economically expedient, instead of eliminating redundant functions, to find ways to rational use through the specialization of production. This issue requires a sound economic assessment to be addressed. In a number of works devoted to FSA, use value is defined more broadly, taking into account the conditions for the functioning of systems. At the same time, such factors of use value as external operating conditions, destination parameters, functional and parametric reserves, operating mode are singled out. This approach makes it possible to increase the level of consistency in the conduct of FSA, to Special attention on the third group of system features of the object - signs of behavior, functioning. .
A broader understanding of use value allows greater accountability in the analysis of the impact external environment to the system in question. An objective study of production and economic systems and complex economic processes is possible only with a deep analysis external conditions functioning.
Function - a qualitative aspect of consumer properties, which are divided into:
- 1. the main function, expressing the purpose of the object;
- 2. the main functions that ensure the implementation of the main;
- 3. auxiliary functions that implement the main ones;
- 4. redundant or unnecessary features;
- 5. harmful functions (for example, the same watch or TV can be unnecessarily heavy and bulky, etc.)
Quantification of functions is possible using one or more closely related performance characteristics. For example, the process of transportation or machining is quantitatively determined by the productivity of transport or metalworking equipment and also depends on the type of cargo being transported, the characteristics of the workpieces, and working conditions. The functioning of electronic elements is determined by the parameters of the system in which they are included. So, an electric capacitor emits a signal of a certain frequency for given quantitative characteristics of the rated capacitance and voltage, the temperature coefficient of the capacitance, the loss tangent, and the level of moisture protection. The quantitative definition of functions makes it possible to compare qualitatively identical consumer properties and their totality - use values. .
It is easy to compare products whose use value is determined by one property. If there are several properties, improving one of them, for example, twice, does not entail a proportional increase in the entire use value of the product in question. There is a need to assess the significance of consumer properties and functions. Then the use value of the product (F), its functionality can be quantified by the expression used to assess the integral quality (quality factor):
where: pi, - operational and technical characteristics of the i-th consumer property, calculated in relative terms;
ni, is the coefficient of significance of the i-th consumer property in the overall operational and technical characteristics of the product (i.e. in the overall functional utility or use value).
The relationship between the use value of products as a whole and individual consumer properties is rather complicated due to the different purposes of devices and devices similar in function. For example, microcomputers of general and special purpose despite the similarity qualitative characteristics main function: to carry out calculations, to perform calculations. It cannot be said that the use value of a bus with 60 passenger seats is 12 times higher than that of a 5-seat car, since the purpose of these Vehicle different. Hence the need arises in the FSA, as well as in the calculations of the comparative economic efficiency new technology. When evaluating the technical level of products and calculating the quality factor, it is correct to choose products, devices for analysis and comparison. For FSA, it is necessary to choose products, objects of the same purpose, having close areas of application.
A functional approach to solving production and technical problems creates the prerequisites for just such a choice. Production systems (industry, association, enterprise and their subdivisions) as the main function have the output of products of a given technical level (quality). Quantitative measurement of production volumes in mechanical engineering is carried out in physical and value terms. In practice, an integral assessment of the functionality of such a system is carried out by calculating the cost indicators of the volume of production: gross, marketable, sold products, or others.
FSA is based on the following principles:
The principle of early diagnostics - its essence lies in the fact that the value of the identified reserves depends on at what stage of the life cycle of the product the FSA is carried out: pre-production, production, operation, disposal. Excessive costs are mainly laid down at the design stage. That is, the maximum effect from the analysis can be obtained at this stage, when it is possible to prevent unnecessary costs not only for the manufacture of the product, but also for the preparation of its production. At the stage of industrial production, the size of the effect is reduced due to the fact that work has already been carried out to ensure its functioning, manufacturing process. Intervention in this process will not be without cost. More big losses will be when making changes to the design of the product at the stage of its operation. Therefore, it is most expedient to carry out FSA during the design development of products. For example, it is 10 times cheaper to eliminate an error in product development than in the production process, and 100 times cheaper than in the process of using the product by consumers.
The principle of priority - since the FSA method is not yet widespread and does not cover all kinds of objects (types of products, technologies, etc.), and the number of specialists who own the technique is not enough, then, first of all, the FSA should be subjected to processes and products that are on the stage design development and will be produced on a large scale. This will allow, firstly, maximum result FSA with minimal costs for its implementation. Secondly, the significant effect of the application of the method will contribute to its wider recognition.
The principle of optimal detailing, the main meaning of the method is the selection of consumer functions inherent in the object. But if the object under study is too complex, then as a result of its division into functions of the latter, a lot can be formed. Such a narrow specification makes the analysis program very cumbersome and incomprehensible, and will not contribute to the speed and effectiveness of its implementation. In this case, the study of a complex object is best solved in two stages:
- 1. The division of the object into large parts (individual machine components or devices, more or less separate groups of technological operations).
- 2. FSA execution for each of the selected smaller objects.
The principle of consistency - the implementation of a set of works on the FSA requires a certain sequence in the study, first of all, a preliminary study of the future object and all the circumstances associated with its production and use. In this case, it is necessary to follow the logical scheme of detailing - from the general to the particular (object - node - function). It must be remembered that when performing the FSA, the results of its implementation at each stage depend on the completeness and quality of the work performed at the previous stages.
The principle of highlighting the leading link (eliminating bottlenecks) - most often during the analysis it turns out that either in the economic complex or in a single product there is some part that requires high costs to ensure the viability of this object or hinders the receipt of the effect from its use. It is clear that in this case it is more expedient to direct research towards the elimination of these constraining circumstances or directions. Thanks to this choice of research direction, the minimum cost of conducting FSA will lead to the activation of the entire analyzed system and will significantly increase the overall effect of its functioning.
