Guidelines for Cost Reduction in the Electrical and Electronics Industry
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Abstract
The electrical and electronics industry has been a major industry of Thai economy for decades. However, the number of Thai entrepreneurs at losses remains higher each year. Therefore, improvements to reduce costs for the electrical and electronics industry are very important to create business competitiveness and sustainability. The purpose of this research was to study cost reduction guidelines in electrical and electronics industry then developed into a structural equation model for both qualitative and quantitative research. Quantitative data surveyed 500 executives of companies with profits for 3 consecutive years, using descriptive statistics, reference statistics, and multiple statistics.
The results showed that the guidelines for cost reduction in the electrical and electronic industry is composed of 4 aspects. The most important factors of each aspect are as following: 1) Labor Management aspect (X ̅ = 4.04, S.D. = 0.36) which its most important factor is encouraging workers to be aware of self-improvement 2) Material Management aspect (X ̅ = 4.04, S.D. = 0.38), which its most important factor is specific characteristics of raw materials are clearly defined. 3) Process Management aspect (X ̅ = 3.96) which its most important factor is manage production with the PDCA system continuously and 4) Overhead Management aspect (X ̅ = 3.93) which its most important factor is preventive maintenance of machinery. For the hypothesis test showed that the difference in manufacturing enterprise sizes revealed overall aspects that were significantly different at the level of 0.05.
The analysis of the developed structural equation model showed that it was in accordance and harmony with the empirical data and passed the evaluation criteria.
Its Chi-square probability level, relative Chi-square, the goodness of fit index, and root mean square error of approximation were 0.069, 1.107, 0.944, and 0.015, respectively. The statistical significance of this study was set at 0.05.