Target and Kaizen Costing Implementation in Construction

Gabriel R. T. Robert1 & Ariovaldo Denis Granja2

1Civil Eng., M. Sc. Candidate at GTE/Unicamp, Engineering Supervisor of a Brand Retail Unit in São Paulo, Brazil.
2Asst. Professor, Construction Management and Technology Research Group (GTE), School of Civil Engineering, Architecture and urban Design, Department of Architecture and Building, State University of Campinas (UNICAMP), Avenida Albert Einstein, 951, Caixa Postal 6021, Campinas/SP, CEP 13083-852, Brazil, Tel.: +55 19 3788-2082, FAX + 55 19 3788-2411,


The challenge of implementing a combined target and kaizen costing approach has been recognized as a promising strategy for construction companies seeking to increase their profit margins, efficacy of production process and relationship with suppliers. Construction companies use to perform their services in a competitive market and can apply this combination to reduce construction costs, while at the same time assuring their profitable business margins. This research sought to implement a combined target and kaizen costing approach along the planning and construction phases of brand retail units (BRU). A context specific case study with four BRU has been devised. The main idea was firstly to design and to specify the units to reduce historical product development costs by means of product’s definition interventions. On the target costing application the “customers care service center” of the company has been consulted about possible product conception interventions that were not perceived as value by customers. Later, the kaizen costing approach sought continuous improvements on production processes mostly based on suggestions originated by the main sub-contractors. The case study results show cost reductions around 13% compared with previous cost data of the company for these facilities.


Target costing, Kaizen costing, Cost reduction, Brand Retail Units



Robert, G.R.T. & Granja, A.D. 2006, 'Target and Kaizen Costing Implementation in Construction' In:, 14th Annual Conference of the International Group for Lean Construction. Santiago, Chile, 1-. pp 91-105

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