You are ready to begin building your cost model, or perhaps you are in the process of electing/upgrading your ERP software and want to plan through how it will support your cost model. As we have discussed, at the core of a cost model is the business processes that make up your cost – plus any materials used, of course. This column will discuss four concepts to guide your thinking. Especially when considering the platform (e.g., ERP or Excel) where you will build your Cost Model, you must determine if your ERP system will accommodate some of these cases. A skilled Excel modeler can accommodate just about anything! By and large, these concepts apply to manufacturing situations and are most easily understood in that context.