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At a time when so much is happening in the world of manufacturing, it is hard for companies to know the best way to spend their valuable time and resources. Do we focus on efficiency improvements? Should we put more effort into new product development? How do we manage capacity? These and other questions challenge manufacturing managers on a daily basis. But among all of the uncertainty there is one truth that remains for all manufacturers – Those with the best understanding of their costs stand the best chance of predicting and controlling their fate. But, understanding costs is not an easy venture. With multiple manufacturing facilities, rigid systems, and conflicting methodologies, the task of delivering the right cost information to the right managers is confusing and complicated. For the past few years a trend has emerged among Impact:ECS users that indicates "more is better" when if comes to cost information.
 
In most manufacturing environments a single, standard product cost is published annually. While this number is fine for valuing inventory, it falls short of answering many of the cost related questions faced by managers. To overcome this problem Impact:ECS users have discovered that multiple sets of standard costs are needed. Popular terms for these standard costs are Frozen Standard, Current Standard, and Going-to Standard. The Frozen Standard may be used for inventory valuation and baseline comparisons. The Current Standard, which is nothing more than a standard that is continually updated to reflect today’s costs, is used for product pricing, departmental variance reporting, and flexible budgeting. Finally, the Going-to Standard gives users an idea of what their costs will be three, six or nine months from today. This is especially useful when quoting orders today that will be filled in the months to come.
 
Without a doubt, the combined use of these multiple Standards plus Actual costs is a step in the right direction when attempting to understand costs. Armed with the right cost answer for the right question, managers and business leaders are much more likely to make the right decision. To this end, it seems that more really is better.