Target Costing & Managing To Market Rates

This week we are looking at the four indispensable organizational competencies – the ones that will likely make the difference between simply surviving, and being successful (see Four Essential Organizational Competencies For The Future all members). We've looked at competing for customers and at participating in value-based purchasing. Now, for the next indispensable skill set – target costing.

So what is it? Like many business constructs, simple in concept and difficult to implement. Target costing is a pricing method to reengineer the cost of a service in order to hit a target cost – the maximum amount of cost for a . . .