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Hamed Fazlollahtabar (Department of Industrial Engineering, School of Engineering, Damghan University, Iran)
Mohammad Saidi-Mehrabad (Faculty of Industrial Engineering, Iran University of Science and Technology, Iran)

Cost Engineering and Pricing in Autonomous Manufacturing Systems

ISBN: 978-1-78973-470-6, eISBN: 978-1-78973-469-0

Publication date: 12 March 2019

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Citation

Fazlollahtabar, H. and Saidi-Mehrabad, M. (2019), "Index", Cost Engineering and Pricing in Autonomous Manufacturing Systems, Emerald Publishing Limited, Leeds, pp. 157-164. https://doi.org/10.1108/978-1-78973-469-020191009

Publisher

:

Emerald Publishing Limited

Copyright © 2019 Emerald Publishing Limited

INDEX

Absorption costing
, 9, 67

Accounting cost
, 72

Acquisition
, 20, 43–44, 48, 123

Activity-based costing (ABC)
, 11, 49, 67, 92

Adjustment price (AP)
, 34–35

Administrative costs
, 53, 87

Algorithm-based predictive analytics
, 125

Allocating costs
, 45

Annual production volume (APV)
, 85

Assemble-to-order production (ATO production)
, 109

Assembly cost
, 62

estimation
, 60

Assembly labor cost
, 56

Assembly lines
, 83

Assigning costs
, 45

Attributing costs
, 45

Automated guided vehicle systems (AGVS)
, 108

Automated guided vehicles (AGVs)
, 108

Automated systems
, 25, 124

Automatic control
, 117

loop
, 117

system limitations
, 1, 90

Automatic guided vehicles (AGVs)
, 128, 133

Automation
, 117

concession price
, 34

energy pricing model
, 30–32

life cycle economic aspects
, 17–19

resources
, 17–20

supply complexity
, 12–13

Automobile firm
, 5

Autonomic computing
, 43–45

Autonomous cognition
, 107–108

Autonomous devices
, 36

Autonomous manufacturing system (AMS)
, 1–3, 90

AB–application area from costing method
, 70

ABC
, 67

AC–level of integration between costing methods and production
, 71

AD–advantages resulting from application of costing methods
, 71

AE–difficulties in deployment
, 73

cost engineering
, 72

cost minimization/profit maximization
, 72–81

cost of quality
, 81–87

cost-minimization problem
, 65

indirect–overhead costs
, 66

keywords and combinations
, 69

price optimization in
, 117–134

pricing models in
, 107–114

Autonomous production
, 107

Autonomous system
, 43

CoQ application in
, 83–87

Autonomy criteria
, 89

Average costs
, 39, 77–79

average quoted cost of enterprise
, 39

functions
, 77
Bandwagon effect
, 27

Basic price (BP)
, 28, 34–35

Big data
, 122, 125

Big Data Analytics
, 109

Biology-inspired technologies
, 90

Business

environment
, 65

events
, 10

management cost accounting methods
, 17

model
, 44
California electricity crisis (2001)
, 37

Case-based reasoning (CBR)
, 32

Cash inflow parameters
, 33

Cash outflow parameters
, 33

Causal loop diagram for concession pricing of automation projects
, 35

Circular cause and effect relationships
, 34

Class of outputs
, 45

Clothing
, 29

Cloud computing
, 121, 125

Cobb–Douglas production function
, 75

Cognitive agent-based manufacturing system
, 91–92

Communicating instructions to workers
, 120

Compensated shadow cost of each unit
, 40–41

Competition-based pricing strategies
, 7

Computer numerical control (CNC)
, 128, 133

Computer simulation
, 133–134

Computer system
, 119

autonomic
, 45

complex
, 43, 45

functions for automated manufacturing
, 120

integrated
, 12

Computer-controlled machines
, 133

Computer-software cost
, 129–130

Computing, high-performance
, 121

Concession pricing model
, 27–28, 32

causal loop diagram
, 35

comprehensive structure in automation projects
, 32

parameters and risk factors
, 33–36

parameters of automation projects
, 34

Consumers
, 27–28

Control

computer numerical
, 128, 133

define measure analyze improve control approach
, 82

direct numerical
, 128, 133

material handling system
, 120

production process
, 108

quality
, 120

statistical process
, 108–109

Control charts (CC)
, 130

Conventional manufacturing

cost
, 126

systems
, 128

Conversion cost
, 52

Cooperative infrastructure
, 108

Cordless technology
, 2

Cost accounting
, 45

documenting cost accounting policies
, 46–47

policies
, 45

Cost and price in autonomous manufacturing

AMS
, 90

decomposition of profit
, 94

electricity cost function
, 99–100

example
, 103–105

labor cost function
, 101

manufacturing profit maximization
, 102

MES
, 91

model development
, 93

production function
, 97–99

reconfiguration and autonomy
, 89

time-varying pricing
, 94–97

Cost breakdown structure (CBS)
, 50

Cost Metric Algorithm Interface (CMAI)
, 14, 16–17

Cost minimization/profit maximization
, 72

application study
, 75–77

combination of robot and resources for cost minimization
, 74

cost functions
, 77–81

long-run cost minimization
, 75

short-run cost minimization
, 74–75, 76

Cost of quality (CoQ)
, 81

application in autonomous system
, 83–87

Lundvall–Juran curve depicting relationship
, 82

Cost parameters and costing models

application study
, 55–62

autonomic computing
, 44–45

cost accounting concept
, 45–47

cost object
, 47–51

costing model development
, 53–54

manufacturing companies
, 43

manufacturing costs
, 51–53

PSS
, 44

TLC
, 43–44, 63

Cost-based pricing
, (see Revenue-oriented pricing)

Cost-inducing factor
, 19

Cost-management systems
, 65

Cost-minimization problem
, 65

Cost-plus method
, 36–37

Cost(ing)
, (see also Labor), 3–7

accounting policies
, 46–47

in automation
, 9

automation resources
, 17–20

data integration model
, 20–21

of energy
, 60

engineering
, 72

estimation
, 127

of facilities
, 60

functions
, 77–81

levelized
, 3

of manufacturer
, 20

minimizing input choices
, 72

model application
, 134

model development
, 12–17, 53–54

model parameters
, 56

of molded parts
, 56

objects
, 45, 47–51

opportunity
, 4–6

related works
, 10–12

of sheet metal parts
, 59

switch of responsibilities
, 15

system for advanced manufacturing systems
, 126–127

of testing equipment (Cequipment)
, 85

of testing sample (Ctesting)
, 85

Critical-peak pricing (CPP)
, 95

Current demand
, 110–111

Custom products, higher-end
, 55

Customers

core business processes
, 44

customer-oriented pricing
, 26, 125

Cyber physical systems
, 120
Data

analytics
, 121

data-driven decision-making
, 120–121

integration model
, 20–21

in smart manufacturing
, 121–122

Decision rules
, 119

Define measure analyze improve control approach (DMAIC approach)
, 82

Demand
, 110, 112

Deployment agent
, 14

Depreciation cost
, 130

Deproduction
, 19

Deregulated electricity markets
, 36

Design for manufacture and assembly (DFMA)
, 108–109

Design structure matrix (DSM)
, 82

Device’s capacity cost
, 40

Digital simulation models
, 109

Direct costing
, 9, 45

Direct labor
, 127–128

cost
, 51–52

Direct materials cost
, 51

Direct numerical control (DNC)
, 128, 133

“Direct variable” cost
, 49

“Disposal/deproduction”
, 18

Double stage acceptance sampling strategy
, 84–86

Download work part programs
, 120

Driving force
, 26

Dynamic pricing
, 26, 112, 124
Eco-labeling
, 28

Economic cost
, 72

Economic quality level (EQL)
, 81–82

Efficient price
, 26, 124

Electricity
, 93–94

cost function
, 99–100

markets
, 36

payment
, 29

regulated and deregulated electricity markets
, 36

Electricity value equivalent pricing method (EVE pricing method)
, 37

Electronics
, 29

Energy

consumption of machine tools
, 2–3

consumption scheduling vector
, 30–32

cost of
, 60

pricing mechanisms
, 38

Engineer-to-order production (ETO production)
, 109–110

Engineering economic methods
, 3

Entity relationship model
, 12

Equivalent marginal cost pricing model (EMCP model)
, 39

in automation pricing
, 40

Expenditure minimization
, 65

Expenses
, 4–5, 11, 45, 52, 63, 87

External reporting
, 9
Facility cost
, 56

Factory automation, strategic decision-making about
, 134

Failure cost
, 130–131

Failure diagnosis
, 120

Failure modes and effects analysis (FMEA)
, 108–109

Faux wood blinds
, 2

Feasible scheduling set
, 31

Final price (FP)
, 28

of device
, 41

Fixed cost (Cfixed)
, 9, 85

Flexibility cost items
, 132

Floor-space cost
, 129

Focal company
, 11

Friction
, 2

Fringes
, 127
Genopersistation
, 48–49

Gucci
, 29
Hedonic effect
, 27

Heterarchical agent-based model
, 14

High-cost manufacturing environment
, 62

Holons
, 91

Homogeneity
, 78

Homogeneous cost pools
, 45
IBM
, 44–45

IDEAS architecture
, 14

Idle cost
, 132

Image-based pricing
, (see Value-based pricing)

Inclining block rate (IBR)
, 29

Independent automation enterprises
, 37

Indirect costs
, 45

Indirect labor
, 52, 127–128

Indirect–overhead costs
, 66

Individual product sustaining service
, 50–51

Industrial engineering methods
, 108–109

Industrial process automation
, 118

Infineon Technologies
, 118

Information leakage vulnerabilities
, 121

Information systems (IS)
, 10

costs and benefits
, 21

Input–Output Analysis (IOA)
, 54

Input–output production–inventory system
, 54

Inspection cost (Cinspection)
, 85

Insurance
, 9, 52, 128–129

Integrated manufacturing performance measure (IMPM)
, 134

Integrated system and cost modeling
, 54

Intelligent iron ore mine
, 108

Intelligent machining systems
, 1

Intelligent manufacturing systems (IMS)
, 89

Intensive socio-technical system
, 44

Internal reporting
, 9

Internet of things
, 121

Inventory cost
, 132–133

Investments
, 37, 45
Job design
, 108–109
Labor
, (see also Cost(ing))

assembly labor cost
, 56

cost
, 101, 127–128

direct
, 127–128

indirect
, 52, 127–128

operator labor cost
, 56

productivity
, 119

supervisory labor cost
, 56

time-varying labor cost function
, 101

Lean

accounting
, 2, 67–68

concept
, 2

manufacturing
, 2, 67–68, 92

production processes
, 69

Levelized cost
, 3

Load duration curves (LDCs)
, 37–38

Local area network (LAN)
, 29

Long-run cost minimization
, 75

Long-run marginal cost (LRMC)
, 37

Long-term service agreements
, 44

Louis Vuitton
, 29

Low Level Control Integration Library Interface
, 14

Low-cost manufacturing environment
, 62

Lower specification limits (LSL)
, 130

Luxurification in society
, 28–29

Luxury brands
, 29
Machine

analytics
, 125–126

cost
, 128–129

tools
, 10

Machining processes
, 3, 10

Make-to-stock production (MTS production)
, 109

Manned cells
, 127

Manual products
, 55

Manufacturers
, 26

production system
, 56

Manufacturing

costs
, 3, 51–53

firms
, 122

organizations
, 9–10

overhead cost
, 52

pricing in
, 123–127

profit maximization
, 102

sector
, 10

strategy
, 126

systems
, 1, 10, 18, 45, 90–91, 119

technology and processes
, 121–122

Manufacturing Cost Levelization Model
, 3

Manufacturing execution system (MES)
, 91

Marginal cost

functions
, 77

pricing method
, 36–37

Market prices
, 6

Market-based incentives
, 29

Marketers
, 26

Marketing

costs
, 53

mix
, 6

Material

cost
, 128

in smart manufacturing
, 121–122

Mathematical model
, 28

Minimum attractive rate of return (MARR)
, 34

Minimum cost curve (MCC)
, 39

Modern machine tools
, 10

Mold cost estimation
, 58

Moment of truth”
, 125

Monitor safety
, 120

Motorized products
, 55

MSC’s fishery certification programmer
, 29

Multifunctional worker
, 127
Net present value (NPV)
, 3

of automation project
, 34

Network and relational data structures
, 12

“NK” model of complex system
, 12

Nonmanufacturing costs
, 52
Objectives of pricing
, 25

“One size fits all” system setup
, 118

Operating characteristic (OC)
, 83

Operating cost for maintenance and repair
, 20

Operation management
, 120

Operations-oriented pricing
, 26, 124

Operator labor cost
, 56

Opportunity costs
, 4–6, 126

Optimal choice of energy consumption scheduling vector
, 32

Optimal manufacturing systems design
, 3

Optimal prices
, 37

Organizational information processing theory
, 21

Original equipment manufacturer (OEM)
, 44

Overall cost model
, 56

Overall pricing strategy
, 124

Overtime pay
, 97
Parametric values in cost model
, 133–134

Partial elasticity of substitution
, 80

“Parvenus”
, 29

Path Computation Algorithm Interface (PCAI)
, 14

Payback period
, 119

Payoff
, 4

Perfectionism effect
, 27

Physical production in manufacturing industry
, 108

Plastic manufacturers
, 51

Plus cost of scrapping lot (Cscrap)
, 85

Policy analysts
, 4

“Poseurs”
, 29

Predictive engineering
, 121–122

Premium pricing
, 28

Prestige brands
, 27

Prestige goods
, 29

Prestige pricing
, (see Premium pricing)

Prestige-Seeking Consumer Behaviors
, 27

Prevention cost
, 130

Prevention-appraisal-failure model (P-A-F model)
, 81

Price, product, promotion, and place (Four Ps)
, 123

Price adjustment
, 28

coefficient of reference cases
, 36

Price optimization

application of cost model
, 134

autonomous manufacturing systems
, 117–118

computer system functions for automated manufacturing
, 120

industrial automation
, 118–119

pricing in manufacturing
, 123–127

RWSC estimation
, 127–134

smart manufacturing
, 121–123

Price/pricing
, (see also Cost(ing)), 3–7, 25, 123–124

approaches to pricing strategy
, 124–125

in automation
, 25

autonomous cognition
, 107–108

cost system for advanced manufacturing systems
, 126–127

decisions
, 123

decisions
, 7

ETO
, 109–110

industrial engineering methods
, 108–109

literature
, 30

in manufacturing
, 123

model development
, 29–41

model development and analysis
, 110–114

objectives
, 25–29

premium
, 29

profitable selling
, 125–126

strategies
, 7

Price–demand curve
, 110–112

Process capability (PC)
, 130

Process-based cost model
, 83

Product agent (PA)
, 14–16

“Product and support” business model
, 44

Product costing systems
, 66–67

Product Life Cycle
, 18

course of cost and benefit in
, 19

maximum benefit
, 19–20

shares of costs, revenue, and benefits
, 20

Product pricing
, 36

Product service system (PSS)
, 44

Production/productivity
, 18–19

cost
, 126

function
, 97–99

paradox
, 134

technologies
, 108

Profit
, 107

maximization
, 93

profit-oriented pricing
, (see Revenue-oriented pricing)

Profitable selling
, 125–126

Project risk similarity (PRS)
, 35

Property taxes
, 9

Provenance
, 28

Public Finance Act (1989)
, 46

Public–private partnership (PPP)
, 28
Qualitative multiple case-based research method
, 122

Quality and flexibility costs
, 126

Quality cost items
, 130

Quantum computing
, 121
R&D process
, 4

Real-time pricing (RTP)
, 29

Reconfiguration criteria
, 89

Recycling costs
, 20

Reference automation agent architecture model
, 14–17

Regulated electricity markets
, 36

Relationship-oriented pricing
, 27, 125

Relatively ill-structured costs (RISC)
, 126–127, 130–134

Relatively well-structured costs (RWSC)
, (see also Cost(ing)), 126

computer-software cost
, 129–130

depreciation cost
, 130

estimation
, 127

floor-space cost
, 129

indirect labor
, 127–128

machine cost
, 128–129

tool cost
, 129

Representative automation pricing methods
, 36–41

Residual demand
, 110–114

Resource sharing and networking
, 121–122

Revenue-oriented pricing
, 7, 26, 124

RFID tags
, 125

Robots
, 128, 133

Routing Entity Agent (REA)
, 14–16
Salaries
, 127

SCADA control systems
, 118

Scheduling

approach
, 121

horizon
, 30

of products, parts, assemblies, or subassemblies
, 11

schedule production
, 120

Seafood eco-label reward
, 29

Self-adaptation to disturbances
, 89

Self-managed operations
, 43

Selling costs
, 53

Semiconductor companies
, 118–119

Service instance
, 49

Service-oriented solutions
, 121

Set-up cost
, 132

Shop floor resources
, 11

Short-run cost minimization
, 74–75

with one fixed input
, 76

Short-run marginal cost (SRMC)
, 37

Short-term supply chain scheduling
, 121

Single CNC machine tools
, 17–18

Skill Management Entity Agent (SMEA)
, 14–16

Smart manufacturing
, 120–123

SMEs
, 122

Snob effect
, 27

Socially oriented pricing
, 27, 125

Standalone instance
, 47, 50

Standard linear price–demand curve
, 110

State Sector Act (1988)
, 46

Statistical process control (SPC)
, 108–109

Strategic decision-making about factory automation
, 134

Strategic pricing
, 6

Supervisory labor cost
, 56

Supply chain
, 26, 54, 56

management
, 12, 121

scheduling
, 121

Sustainability
, 121–122

System dynamics model (SD model)
, 28, 33
Task analysis
, 108–109

Taxes
, 3

Taylor’s equation
, 129

Theoretical model
, 7

Through-life costing (TLC)
, 43–44, 63

Time interval
, 49

Time-driven activity-based costing (TDABC)
, 67, 92

Time-of-use (TOU)
, 94–96

Time-varying

labor cost function
, 101

pricing
, 94–97

Tool cost
, 129

Tooling and supervisor costs
, 59

Total capacity cost of enterprise
, 40

Total cost (TC)
, 93–94

functions
, 77

Total revenue (TR)
, 93

Traditional accounting methods
, 17

Traditional cost accounting
, 119

Traditional costing system
, 2, 67

Traditional manufacturing systems
, 90

Transport element
, 16–17

Transport Element Agent
, 14, 16–17

Transport Entity Agent (TEA)
, 14–16

Transportable systems
, 20
U.S. Federal Energy Regulatory Commission
, 94

Uniform quality standards
, 55

Unmanned air vehicle program (UAV program)
, 47–48

Unreliable production
, 107

Upper specification limits (USL)
, 130
Value stream costing (VSC)
, 67–68, 92–93

Value-based pricing
, 7, 26, 125

Variable cost (VC)
, 9, 85, 93

Variance analysis
, 9

Veblen effect
, 27

Vehicle–infrastructure integration
, 108

Vensim PLE32 software
, 33
Wages
, 127

Waiting cost
, 132

Waiting time
, 29

Window covering products
, 55

Work-in-process inventory (WIP inventory)
, 129
Yield management
, (see Dynamic pricing)
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