The need for Kaizen costing in indigenous Nigerian construction firms.
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OMOTAYO, T. and KULATUNGA, U. 2015. The need for Kaizen costing in indigenous Nigerian construction firms. In Proceedings of the 12th international post-graduate research conference (IPGRC15), 10-12 June 2015, Salford, UK. Salford: University of Salford, ID 045, pages 587-596. Held on ICONDA CIBlibrary [online]. Available from: http://www.irbnet.de/daten/iconda/CIB_DC28781.pdf
The application of adequate cost management methods and techniques before and during construction activities is a major determinant of project success. Construction cost management methods such as target costing, life cycle costing, activity based costing and kaizen costing are some of the ways in which a project cost can be effectively managed. Kaizen is a Japanese word for continuous improvement and it has been used in the Japanese manufacturing sector since the 1960s. This method employs techniques for incremental cost reduction and it is based on Kaizen philosophy and principles. Kaizen costing is a very useful method for post-contract cost control because it is applied during the manufacturing or production stage of a product. This cost control method creates more profit for the manufacturer, provides better quality products and improves customer satisfaction. Kaizen costing is a post-contract cost management method which can be used to increase the competitiveness of a company. This approach can be combined with target costing and other cost management methods for more effectiveness. This paper focuses on how kaizen costing can be used as a means of overcoming the challenges facing the Nigerian construction firms in terms of cost overrun; project delays and abandonment; inadequate cost control management and improving competitiveness of indigenous construction firms. Based on existing literature, this paper illustrates how kaizen costing can effective contain the challenge of cost and time overrun during construction.