Feasibility study on the implementation of Mahalanobis-Taguchi system and time driven activity-based costing in electronic industry
Electrical and electronic industry is one of Malaysia’s leading industries which covers around 24.5% in manufacturing production sector. With a continuous innovation of the Industry, inductor component gets higher demand from customer and it is good if there is a study to convince that those factors are really significant to the production as well. Meanwhile, the current costing being used is difficult to access the complete activities required for each workstation and need separate analysis to measure the un-used capacity in term of resources and cost. The objective of this work is to clarify the relationship between Mahalanobis-Taguchi system (MTS) and time driven activity-based costing (TDABC) in the electronic industry. The data collection is focused on inductor component by consiedring the historical data in 2018. MTS is used as a method to optimize various parameters while TDABC is used to measure the un-used capacity by constructing the time equation and capacity cost rate. There are 7 parameters considered which are condition of wire, condition of winding, condition of epoxy, condition of core, condition of lead part, condition of marking and condition of soldering. As a result, MTS is successfully developed the normal and abnormal Mahalanobis distance (MD). In February, the normal MD is 0.9998 and the abnormal is 15.6538 with 2 significant parameters with signal to noise is 0.1244. In addition, there are 3 parameters consistently influenced along 10 months such as condition of core, condition of lead part and condition of soldering and 2 parameters are not consistently influenced such as condition of epoxy and condition marking. On the other hand, the total used and un-used capacity of time are 257124.02 minutes and 5217031.43 minutes respectively while the total of used and un-used of cost are MYR6,296,493.10 and MYR6214807.07 respectively. Eventually, this work concludes that both methods are a great tool and feasible to be implemented in the electronic industry.
Abu, M.Y., Jamaluddin, K.R. & Zakaria, M.A. (2017). Classification of crankshaft remanufacturing using Mahalanobis-Taguchi System. International Journal of Automotive and Mechanical Engineering, 13(2),3413-3422.
Abu, M.Y., Jamaludin, K.R. & Ramlie, F. (2014). Pattern recognition using Mahalanobis-Taguchi system on connecting rod through remanufacturing process: a case study. 1st International Materials, Industrial and Manufacturing Conference, 845,584-589.
Abu, M.Y., Jamaludin, K.R. & Zakaria, M.A. (2017). Characterisation of activity based costing on remanufacturing crankshaft. International Journal of Automotive and Mechanical Engineering, 14(2),4211-4224.
Abu, M.Y., Mohd Nor, E.E. & Abd Rahman, M.S. (2018). Costing improvement of remanufacturing crankshaft by integrating Mahalanobis-Taguchi system and activity based costing. IOP Conference Series: Materials Science and Engineering, 342,1-10.
Abu, M.Y., Norizan, N.S. & Abd Rahman, M.S. (2018). Integration of Mahalanobis-Taguchi system and traditional cost accounting for remanufacturing crankshaft. IOP Conference Series: Materials Science and Engineering, 342,1-9.
Afonso, P. & Santana, A. (2016). Application of the TDABC model in the logistics process using different capacity cost rates, 9(5),1003-1019.
Allain, E. & Laurin, C. (2018). Explaining implementation difficulties associated with activity based costing through system uses. Journal of Applied Accounting Research, 19(1),181-198.
Anzai, Y., Heilbrun, M.E. & Haas, D. (2017). Dissecting costs of CT study: application of TDABC (time-driven activity-based costing) in a tertiary academic center. Acad Radiol, 24,200–208.
Azmi, I.I., Zaini, S.N.A.M. & Abu, M.Y. (2019). Application of Mahalanobis-Taguchi system in palm oil plantation. Journal of Modern Manufacturing Systems and Technology, 3,1-8.
Chang, C.T., Chou, Y.Y. & Zhuang, Z.Y. (2014). Apractical expectedvalue-approach model to assess the relevant procurement costs. Journal of the Operational Research Society.
Cudney, E.A. & Corns, S.M. (2011). A comparison of finite state classifier and Mahalanobis-Taguchi system for multivariate pattern recognition in skin cancer detection. IEEE Symposium on Computational Intelligence in Bioinformatics and Computational Biology, 1-7.
Cudney, E.A., Paryani, K. & Ragsdell, K.M. (2006). Applying the Mahalanobis-Taguchi system to vehicle handling. Concurrent Engineering-Research and Applications, 14(4),343-354.
Defourny, N., Perrier, L., Borras, J.M., Coffey, M., Corral, J., Hoozée, S., Loon, J.V., Grau, C. & Lievens, Y. (2019). National costs and resource requirements of external beam radiotherapy: A time-driven activity-based costing model from the ESTRO-HERO project. Radiotherapy and Oncology, 138,187–194.
Erhun, F., Mistry, B., Platchek, T., Milstein, A., Narayanan, V. G., & Kaplan, R. S. (2018). Time-driven activity-based costing of multivessel coronary artery bypass grafting across national boundaries to identify improvement opportunities : study protocol, 1-8.
Ghani, N.F.A., Zaini, S.N.A.M. & Abu, M.Y. (2020). Assessment the unused capacity using time driven activity based costing in automotive manufacturing industry. Journal of Modern Manufacturing Systems and Technology, 4(1),82-94.
Ghasemi, E., Aaghaie, A. & Cudney E.A. (2015). Mahalanobis Taguchi system: a review. International Journal of Quality & Reliability Management, 32(3),291-307.
Haas, D.A. & Kaplan, R.S. (2017). Arthroplasty today variation in the cost of care for primary total knee arthroplasties. Arthroplasty Today, 3(1),33-37.
Hernandez-Matias, J.C. Vizan, A. Hidalgo, A. & Rios, J. (2006). Evaluation of techniques for manufacturing process analysis. Journal of Intelligent Manufacturing, 17,571–583.
Kaplan, R.S. (2014). Improving value with TDABC. Healthc Financ Manag, 68,76–84.
Kaplan, R.S., Witkowski, M. & Abbott, M. (2014). Using time-driven activity-based costing to identify value improvement opportunities in healthcare. J Healthc Manag, 59,399-412.
Lea, B.R. & Fredendall, L.D. (2002). The impact of management accounting, product structure, product mix algorithm, and planning horizon on manufacturing performance. International Journal of Production Economics, 79,279-299.
Mohd Safeiee, F.L., Abu, M.Y., Nik Mohd Kamil, N.N. & Zamrud, N.F. (2020). Diagnosis and costing optimization on inductors in electrics and electronics industry. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,121-127.
Mohd Safeiee, F.L., Abu, M.Y., Nik Mohd Kamil, N.N. & Zamrud, N.F. (2020). The application of time-driven activity based costing system on inductors in electrics and electronics industry. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,88-95.
Mohd Yazid, A., Khairur Rijal, J., Awaluddin, M.S. & Emelia Sari. (2015). Pattern recognition on remanufacturing automotive component as support decision making using Mahalanobis-Taguchi system. 12th Global Conference on Sustainable Manufacturing, 26,258-263.
Mohd Zaini, S.N.A. & Abu, M.Y. (2019). A review on time-driven activity based costing system in various sectors. Journal of Modern Manufacturing Systems and Technology,2,15-22.
Nik Mohd Kamil, N.N. & Abu, M.Y. (2018). Integration of Mahalanobis-Taguchi system and activity based costing for remanufacturing decision. Journal of Modern Manufacturing Systems and Technology, 1,39-51.
Nik Mohd Kamil, N.N., Abu, M.Y., Zamrud, N.F. & Mohd Safeiee, F.L. (2020). Proposing of Mahalanobis-Taguchi system and time-driven activity-based costing on magnetic component of electrical & electronic Industry. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,108-114.
Nik Mohd Kamil, N.N., Abu, M.Y., Zamrud, N.F., & Safeiee, F.L.M. (2020). Analysis of magnetic component manufacturing cost through the application of time-driven activity-based costing. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,74-80.
Phan, T.N., Baird, K. & Su, S. (2018). Environmental activity management: its use and impact on environmental performance. Accounting, Auditing & Accountability Journal, 31(2),651-673.
Su, C.T. & Hsiao, Y.H. (2009). Multiclass MTS for simultaneous feature selection and classification. IEEE Transactions on Knowledge and Data Engineering, 21(2),192-205.
Taguchi, G. & Jugulum, R. (2000). New trends in multivariate diagnosis. Indian Journal of Statistics, 62(2),233-248.
Tsai, W.H. & Jhong, S.Y. (2019). Production decision model with carbon tax for the knitted footwear industry under activity-based costing. Journal of Cleaner Production, 207,1150-1162.
Wang, Z., Lu, C., Wang, Z., Liu, H. & Fan, H. (2013). Fault diagnosis and health assessment for bearings using the Mahalanobis–Taguchi System based on EMD-SVD. Transactions of the Institute of Measurement and Control, 1-10.
Wang, Z., Wang, Z., Tao, L. & Ma, J. (2012). Fault diagnosis for bearing based on Mahalanobis-Taguchi system. Conference on Prognostics and System Health Management, 1-5.
Woodall, W.H., Koudelik, R., Tsui, K.L., Kim, S.B., Stoumbos, Z.G., Carvounis, C.P., Jugulum, R., Taguchi, G., Taguchi, S., Wilkins, J.O., Abraham, B., Variyath, A.M. & Hawkins, D.M. (2003). A review and analysis of the Mahalanobis-Taguchi System. Technometrics, 45(1),1-30.
Yu, Y.R., Abbas, P.I., Smith, C.M., Carberry, K.E., Ren, H., Patel, B., Nuchtern, J.G. & Lopez, M.E. (2016). Time-driven activity-based costing to identify opportunities for cost reduction in pediatric appendectomy. Journal of Pediatric Surgery, 51(12),1962-1966.
Zaini, S.N.A.M., Zheng, C.W. & Abu, M.Y. (2020). Costing structure improvement using activity based costing in palm oil plantation of Malaysia. Journal of Modern Manufacturing Systems and Technology, 4(1),95-109.
Zamrud, N.F. & Abu, M.Y. (2020). Comparative study: activity based costing and time driven activity based costing in electronic industry. Journal of Modern Manufacturing Systems and Technology, 4(1),68-81.
Zamrud, N.F., Abu, M.Y., Kamil, N.N.N.M. & Safeiee, F.L.M. (2020). A comparative study of product costing by using activity-based costing (ABC) and time-driven activity-based costing (TDABC) method. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,171-178.
Zamrud, N.F., Abu, M.Y., Nik Mohd Kamil, N.N. & Safeiee, F.L.M. (2020). The impact of capacity cost rate and time equation of time-driven activity-based costing (TDABC) on electric component. International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems,81-87.
Zheng, C.W. & Abu, M.Y. (2019). Application of activity based costing for palm oil plantation. Journal of Modern Manufacturing Systems and Technology, 2,1-14.