How Is Value-Engineering Relevant to a Well Done Customer Profitability

question 113

Multiple Choice

How is value-engineering relevant to a well done customer profitability analysis, especially when an ABC system is utilized to calculate customer profits (or losses) ?

• A) ABC will satisfy GAAP and provide input into value-engineering decisions
• B) ABC offers the opportunity to analyze the costs of activities assigned to each customer and to determine if improvements can be made to optimize profits
• C) customer profitability analysis will reveal that the cost drivers of less profitable customers are the problem and that value-engineering is the solution
• D) Only value-added activities will be shown in the cost analysis and thus all other costs will be eliminated via value-engineering

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Definitions:

Cold Canvassing

The technique of directly approaching individuals or businesses, without prior contact, to sell goods or services.

Toll-free Numbers

Telephone numbers that allow callers to reach businesses or individuals without being charged for the call, often used for customer service or sales.

Lead

A prospective customer who has shown interest in a product or service, potentially leading to a sale.

Qualified Prospect

A potential customer who has been evaluated and deemed likely to purchase a product or service due to their interest, ability to buy, and authority to make the purchase decision.