Using 'Cell Time Burden' as a Cost Allocation Basis to Support Quick Response Manufacturing

摘要

We propose a two-stage overhead allocation system to support the Quick Response Manufacturing (QRM)philosophy of lead time reduction. In the first stage, we allocate the common overhead to manufacturing cells basedon an approach similar to time-based costing. In the second stage, we allocate cell overhead to products based on anew measure called the cell time burden. We analyze stylized models of QRM firms using queuing theory and gametheory to prove that our allocation basis has superior performance to the time based costing method of allocatingoverhead based on a product’s lead time.