2. ONE MUST CONSIDER COSTS OVER THE ENTIRE, CURRENT PRODUCT CYCLE.

As the description of the product cycle(s) in Figure 1 indicates, there are various phases of a product’s life - many of which are candidates for cost reduction.

3. ONE CAN FIND MANY AREAS OF COST TO REDUCE, BUT FOCUS ON A FEW, PARAMOUNT THINGS.

It’s usually difficult to attack all areas at once if several cost reduction candidates exist. Start with a few of the biggest impact items. One may find that the big impact solutions eliminate the need to worry about the low impact tasks.

4. CHALLENGE EXISTING DOGMA (including these canons) WHEN INVESTIGATING THE POSSIBILITIES.

Methodologies also change as environments, techniques and technologies are refined, discovered and abolished.

5. GENERATE AND OBTAIN A CLEAR, CORPORATE, STRATEGIC COMMITMENT TO AN 'OPEN' PLAN.

Everyone needs to ‘buy into’ and understand the program’s premises and implementation strategy. Generate a business case for the cost reduction program. Most likely there will people who do not agree, for whatever reason, which makes it critically important that the program commitment comes from the top in the form of a sanctioned business case.

6. DETERMINE INVESTMENT EFFORT FOR IMPLEMENTING THE PLAN.

Perform an up-front investigation with enough depth (in convincible detail) to find all cost reduction candidates. Then select a few high impact tasks and estimate (in convincible detail) the Cost Of Investment (COI) of implementing a cost reduction program for these items. Include protection of, or accounting for, existing financial exposure (WIP, FGI, distribution stock, etc.) which the plan may jeopardize.

7. DETERMINE INVESTMENT RETURN FROM THE IMPLEMENTED PLAN.

Do an up-front investigation with enough depth (in convincible detail) to estimate the revenue and net profit effects, Investment Return (IR), of the plan.