Research On Time Cost

With time being the most important competition resources following price, variety, and quality, the expenses that enterprises invest on time compression is more and more. So, economic analysis on action of time compression becomes the base of profit and dominant competition position. It is necessary to develope the research on time cost.This paper systemtically study the time cost in depth by using qualitative analysis and quantitative analysis. This is an exporing research and the main creative points as follows:Firstly, the definition and connotation of time cost is presented. Using the many discipline research results of economics, management, accounting, and TBC theory, this paper inquires into the theory base of time cost, then gives the definition of time cost, that is the expenditure relative to the time compression activities of enterprise, the additional outlay aiming to achieving the time requirement of customer or market and loss as result of failure to satisfying the time requirement, then analyses on the connotation of time cost.Secondly, the method of constitution of time cost based on quality cost is also put forward. Through the contrast of time and quality, TBC and TQM, this dissertation, according to the thought of quality cost classification, divides the time cost into four categories, that is, prevention cost, execution cost, internal failure cost and external failure cost. This method of classification receives the support of the relative theories of cost manangement and TBC et.al. and has the effectiveness in practice.Thirdly, the time & cost equilibrium model in time-based competition is brought forward. Generally, time's reducing can cause cost's increasing. But the facts that came from time-based competition all over world show that the quick new product development speed and delivery speed can be contribute to the reduce of cost and increase in profit. In light of the inconsistency of the two cases, defining the time-cost curve and time elasticity of price from the angle of both company and customer, this paper develops the time & cost equilibrium model in time-based competition. This model theoretically explains the relationship between traditional time&cost trade-off and time&cost coordination in TBC, and describes the phenomenon that the company applying time-based tactics can obtain bigger market share, higher profit and dominant competition position.Fourthly, after analysed the relationship between the above constitution of time cost and time according to the time&cost relationship in TBC, the short-term and long-term time cost feature curves is proposed. This research indicates that the short-term time cost feature curve emphasizes the balance between control cost and control failure cost to achieve the minimum of time cost in short term, and long-term time cost feature curve stresses control cost, especial the prevention cost invested on TBC tactics, because prevention cost can lower the level of execution cost and failure cost, and so the whole time cost in long term.Lastly, based on the automobile industry in China, this dissertation studies the different influences of TBC tactics to time and cost through empirical research, and divides TBC tactics into four categories. An enterprise can choose the different improvement areas of time or cost and corresponding TBC tactics according to own actual situation and the different influences of TBC tactics to time and cost. Also this dissertation proves the existence that TBC makes the time-cost curve move backwards in the time & cost equilibrium model in time-based competition and that time is an important factor influencing cost.