Whirlpool Makes Product Cost Management a Priority
Every manufacturer has three goals related to product costs: keep them low, consistent and competitive. Meeting these challenges tends to be easier for a small company with one plant than a large company with many plants, or plants in several geographic areas or countries.
Whirlpool Corp. has dealt with cost challenges for more than a century while evolving from a single-factory company in Benton Harbor, MI, in 1911, to the largest home appliance maker in the world. Last year, the company had $20 billion in sales, 100,000 employees and more than 70 manufacturing and technical research centers around the globe.
For many years, Whirlpool relied on basic desktop software at each plant to manage product costs. Two years ago, however, the company decided to implement a central cost management database for use by all product development teams.
Dave Ondrias, global manager of cost research for Whirlpool, led the initiative, which resulted in the selection of Enterprise Product Cost Management software from aPriori Technologies Inc. According to Ondrias, the platform further automates product cost estimating processes and ensures global consistency in costing practices.
“One of the main reasons we selected aPriori is because it’s a database tool,” says Ondrias. “It can be easily modified and configured to reflect our suppliers, our manufacturing process and our cost drivers.”
Initially, Whirlpool used the software to develop user-guided cost models for tradeoff studies and competitive tear down analysis. More recently, the company has found the software helpful when determining the product cost of their wire harnesses and PCB assemblies (PCBAs).
“Previously, harness assemblies took two or three days, but can now be done within an hour,” claims Ondrias. “All of the information is available to the cost modelers at the time they need [it] to complete the cost result.”
As for PCBAs, determining cost used to be a laborious process based primarily on spreadsheets. Now, though, workers are able to complete 96 cost models in the time it took to finish one.
Whirlpool also likes aPriori’s reliable and no-nonsense technical support. Ondrias points out that the follow-up provided by aPriori’s support staff is always quick and fact based.
“We’re not led to believe that there is a path of resolution if there’s not,” says Ondrias. “When there is a resolution, the team engages with us to make sure we understand how to apply that to our use case and specific situation at the time.”
Over the past two years, the software has enabled Whirlpool to consistently meet target costs and product-launch deadlines. By having its workers learn and apply more of the software’s capabilities to all future projects, the company hopes to further improve worker efficiency and their ability to consistently share product cost information throughout the whole company.
For more information on product cost management software, call
978-371-2006 or visit www.apriori.com.