Improving an Automotive Workshop’s Profitability Using Lean Management Principles

Pieter Buys () and Hardus Oosthuizen
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Pieter Buys: North West University
Hardus Oosthuizen: North West University

Chapter Chapter 7 in Designing Cost Management Systems to Support Business Decision-Making, 2021, pp 125-144 from Springer

Abstract: Abstract In a competitive business environment, the automotive industry is finding it challenging to remain competitive and profitable. Lean management has as part of its objectives the improvement of operational processes, better cost management and waste reduction. The aim of this chapter is to analyse the potential impact of activity-based costing and value stream analysis in promoting waste identification and improved profitability in an automotive workshop environment. The research indicated that although the workshop is already performing at an efficiency rate exceeding the original equipment manufacturing benchmark, the redesign of the diagnostic aspect of the workflow could result in further improved efficiencies, with resultant profitability improvements. The results prove the point that any organisation should continuously strive for optimum operational process redesign and relevant management information generation.

Keywords: Activity-based costing; Cost management; Lean management; Value stream analysis; Process-re-engineering; JEL codes; L21 (business objectives); L23 (organisation of production); M41 (accounting) (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-981-16-1751-5_7

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DOI: 10.1007/978-981-16-1751-5_7

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