BOBST Group: Costing New Parts

Sebastien Solana had recently joined the research and development team at Bobst Group, a printing industry supplier. His first assignment was to examine the structural elements of the SPeria® Foilmaster 102 (a cutting machine for packaging products) with the objective of reducing its production cost. Solana had analyzed the design of a specific part, the mounted bearing, and had designed a new technologically superior mounted bearing. During the project kick-off session, Solana had paid close attention to a speech by Raymond Verdon, alerting the team about the unrestrained increase in the number of items in the reference database. But Solana was unsure how this thought influenced his analysis. He believed that if a particular piece met technical requirements and reduced the cost of the product, the increase in the number of items should not be a concern. This case explores Solana’s assumption by detailing how to cost his redesigned mounted bearing. Analysis covers inventory, holding, administrative, engineering, IT, and maintenance costs.