The product life cycle costing approach on the new product development decisions and a case study

Businesses should make innovations for adapting to the changing situation, to gain competitive advantage and being market leader. The New Product Development is quite important notion for the business sustainability. Moreover, there is a strategic importance of new product development activities for adapting the business to the changing environment. Products have life cycle like human being, as well. In this regard, a product is respectively being developed, manufactured, marketed and eventually completed it's life. In today's improving technology makes shorter the product life cycle and that situation forces business into realizing continuous product development activities. Businesses need to use some methods to compare with the new product alternatives because of short range new product development needs. In this study, the usage of the life cycle costing approach has been shown as a decision making tool within the new product development activities. The approach has been applied according to the firm's data which located machine manufacturing sector. Additionally, the study's results have been supported by break-even point analysis. Furthermore, the case process has been supported with the activity based costing approach which has significant advantages of using with the life cycle costing approach. Keywords: Life Cycle Costing, New Product Development, Strategic Cost Management