Quantification of Possible Level of Cost Reduction in Enterprise as a Result of Intensification of Production Processes
Quantification of Possible Level of Cost Reduction in Enterprise as a Result of Intensification of Production Processes

Summary/Abstract: The article presents a comparative model system for quantification of the level of change in total production process costs in enterprises. These are changes in the level of costs attained in connection with the application of intensification measures in a given production process or processes which are linked logistically with the production process and measures expressed in them in the production process. Intensification measures allow the attainment of higher process performance, which is expressed in a growth in the level of production. This fact has a possible echo in the possibility of reducing total process costs. The presented model allows an informationally correct quantification of the level of reduction in total process costs in the context of comparison of process variants. The article also presents an information analytical model determination of possible distortion in the level of change of total process costs in the case of a cost comparison of process variants. This information distortion of the level of savings on process costs then initiates a further distortion in potential decisions of managers, who apply these distorted information inputs to subsequent solutions of decisive situations in the enterprise. Our article has been written in order to avoid the occurrence of the input information conditions leading to the formation of such incorrectly taken decisions.

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