Unit of competency Outline

Date retreived
23/07/2026 3:10 PM AWST

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Optimise cost of product

Optimise cost of product

Unit of competency
National Code
MSACMT630A
State Code
W9017
TGA Status
Replaced
DTWD Status
Replaced
Current Release Number
1.00
Current Release Date
01/12/2005
View on TGA
State Implementation and Classification
Approved Date
20/02/2013
Field of Education
080301 - Business Management
Original Release Date
20/02/2013
Nominal Hours
60
Description
This unit covers the knowledge and skills needed to take a global view of the costs of a product and determines methods of reducing costs overall.
Notes
Elements and Performance Criteria
1. Analyse total cost components of product
  • 1.1. Identify all cost components of product
  • 1.2. Allocate cost components to major categories such as overhead, depreciation, energy, consumables and labour
  • 1.3. Distinguish between costs which directly deliver customer features/benefits and waste
2. Optimise costs
  • 2.1. Analyse causes of costs which lead to customer features/benefit
  • 2.2. Determine methods of increasing the customer benefit/cost ratio
  • 2.3. Analyse causes of waste costs
  • 2.4. Determine methods of reducing/eliminating waste costs
  • 2.5. Analyse interactions between cost components
  • 2.6. Check that one method of reducing costs does not cause an increase in another cost/reduction in consumer benefit
  • 2.7. Check that cost reduction plans do not reduce required levels of regulatory compliance or Occupational Health and Safety (OHS)
3. Implement cost optimisation
  • 3.1. Develop cost optimisation plans
  • 3.2. Negotiate with relevant people to agree on implementation plans
  • 3.3. Take actions to implement the cost optimisation
  • 3.4. Monitor the implementation of the cost optimisation
  • 3.5. Make adjustments to the plan as required
RANGE STATEMENT
The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.
Waste
Waste (also known as muda in the Toyota Production System and its derivatives) is any activity which does not contribute to customer benefit/features in the product. Within manufacturing, categories of waste include:
excess production and early production
delays
movement and transport
poor process design
inventory
inefficient performance of a process
making defective items.
Waste for this unit may include activities which do not yield any benefit to the organisation or any benefit to the organisations customers.
EVIDENCE GUIDE
The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, the range statement and the assessment guidelines for this training package.

Overview of assessment requirements
The person will select a product to analyse and determine cost components. Costs will be identified as waste or otherwise as an aid to determining their treatment. The cost reduction plans will optimise the cost of the product overall in terms of benefit delivered.

What are the specific resource requirements for this unit?

Access to a workplace implementing competitive manufacturing strategies. No other specific resources are required.
In what context should assessment occur?

Assessment will need to occur in a workplace.
Are there any other units which could or should be assessed with this unit or which relate directly to this unit?

This unit may be assessed concurrently with appropriate units on continuous improvement/kaizen.
What method of assessment should apply?

Assessors must be satisfied that the person can consistently perform the unit as a whole, as defined by the Elements, Performance Criteria, skills and knowledge. A holistic approach should be taken to the assessment.
Assessors should gather sufficient, fair, valid, reliable, authentic and current evidence from a range of sources. Sources of evidence may include direct observation, reports from supervisors, peers and colleagues, project work, samples, organisation records and questioning. Assessment should not require language, literacy or numeracy skills beyond those required for the unit.
The assessee will have access to all techniques, procedures, information, resources and aids which would normally be available in the workplace.
The method of assessment should be discussed and agreed with the assessee prior to the commencement of the assessment.
What evidence is required for demonstration of consistent performance?

Evidence from a single optimisation may be adequate, although generally analyses of a few products with different cost structures or customer benefit structures would be required.
Replaces
State Code National Code Title Type
W2596 MCMT630A Optimise cost of product Unit of competency
Replaced By
State Code National Code Title Type
WD562 MSS405030A Optimise cost of a product or service Unit of competency