The subjects I write about on this blog will be about Supply Chain Management, Procurement and other related topics. In my previous article I wrote something about the cost-perspective on procurement. Part of the article was about Should Cost Modeling. In this article I will elaborate somewhat on Should Cost Modeling. It Is a broad and varied but sometimes unclear topic, therefore. I’m planning to right regularly on topics of Should Cost Modeling on this blog like the different methods which can be used, practical examples of Should Cost Modeling or how a Should Cost price can be used. These topics may not appear in a logical sequence, it just depends on how much time I have to write, and which topic I’d like to write about at that moment. Therefore I’ve decided to start with the topic about ‘my philosophy’ on should cost modeling, which can be used as an overview in which the expected detailed articles can be placed.
To go straight to the point, figure 1 represents schematically my SCM-philosophy. Further on each aspect of the schematic representations is briefly clarified.