Research On Cost Control With Double And Dynamic Standards In Manufacturing Industry

As the greatest manufacturing country in the world, the manufacturing plays animportant role in the development of China’s economy. However, with the influence of thefinancial crisis and the pressure of international competition increasing, the inflation theaccelerating, and the raw materials and labor costs rising, the spaces of reducing cost formanufacturing enterprises have been very small. Under this circumstance, more and moreChinese manufacturing enterprises have awared of that saving the resources and controlingthe costs are very important, so the cost management strategy also has changed from onlysaving cost to control cost scientifically. Manufacturing enterprise was the original place ofclassical cost control theories, present cost control theories all develop under the conditionof manufactuing enterprise. So researching the issues of cost control in manufacturingenterprise not only provides suggestions for producting and development of manufacturingenterprise, and improving the enterprise’s abilities and efficiency to control cost, but alsorelies on the typical manufacturing environment to optimize and innovate the classic costcontrol theories.Firstly, this article builds the theory framework of cost control with double anddynamic standards in manufacturing enterprise. Through analyzing the application status ofthe traditional cost control theories in manufacturing enterprise, discoveries and elaboratesthe practical problems and defects of these theories, and finds the development trend ofthese theories. On this basis, this paper proposes the relavant concepts of cost control withdouble and dynamic standards, defines the double and dynamic cost control standards andthe cost control system with double and dynamic standards, and analyes the meaning andcharacters of cost control system with double and dynamic standards. Thirdly, this paerindentifies the elements of the cost control system with double and dynamic standards, andanalyzes the functions of these elements. At last, this paper elaborates and analyzes therelationship between these elements, and builds the coupling operation model on thecoupling operation of these elements.According to the analysis about the cost control system with double and dynamicstandards, this paper researches to setting the double and dynamic cost control standards.Firstly, this paper clears the conditions and path of setting double and dynamic cost control standards, and analyzes the conditions, technical path and the basic assumptions. Secondly,according to the path for setting double and dynamic cost control standards, this paperselects the comprehensive weighting method of AHP-Entropy, and evaluates the comprehensive cost level in several periods. Thirdly, this paper orders the comprehensive costlevel, makes sure the candidates for “Basic-Model” cost control standards, and determinesthe final double and dynamic cost control standards. At last, this paper proposes to set thenew double and dynamic cost control standards at the beginning of every period, so as tomake sure the dynamic adaption for the environment.This paper also researches to identify the black box of cost control with double anddynamic standards, and observe and monitor it. Firstly, this paper identifies the black box ofcost control with double and dynamic standards, analyzes the information sources, explainsthe influence of information sources to employee’s cost control psychology and behavior,and determines specific inputs and outputs of cost control system with double and dynamicstandards in manufacturing enterprise. Secondly, this paper analyzes employees’ attitudesand behavior to cost control with double and dynamic standards based on observation andexperimental analysis, and analyzes the decision-making process. At last, this paperformulates the control strategies of the black box of cost control with double and dynamicstandards, supervises and controls employee’s actions by building billboard informationsystem, recording employees’ cost control database and surveying employees’ cost controlsatisfaction.This paper researches to evaluate the performance of cost control with double anddynamic standards and feedbacks the variances. Firstly, through analyzing the existingmethods about performance evaluation of cost control, this paper chooses DEA method asthe basic performance evaluation methods of cost control with double and dynamicstandards, and introduces the principles and typical models of DEA method. Secondly,determines the decision-making units of cost control with double and dynamic standards,builds the inputs and outputs index system, and applies DEA-Benmarking model toevaluate the performance of cost control with double and dynamic standards. Finally,accounring the cost variances, and builds the feedback mechanism.Then, this paper researches the game model of cost control with double and dynamicstandards in manufacturing enterprise, and makes the specific measures for incentive. Firstly, this paper analyzes and describes the game problems of cost control with doubleand dynamic standards, discusses the principal-agent relation between managers andemployees, determines the game type of cost control with double and dynamic standards.Secondly, this paper builds principal-agent game model of cost control with double anddynamic standards, and analyzes the equilibrium results of the model based on the basichypothesis and solutions. At last, this paper makes specific measures of cost control withdouble and dynamic standards in manufacturing enterprise, including incentives fromindividual, groups and organizational environment.At last, this paper researches the actual operation process of cost control with doubleand dynamic standards in HD Company. Firstly, this paper chooses the15cylinderproduction teams belonging to the machining workshop in HD Company as the researchingsubjects, and analyzes their cylinder cost. Secondly, determines the weights of accountingperiods basing on entropy method, and sets the double and dynamic cost control standards.Thirdly, applies the DEA-Benchmarking method to evaluate the relative effectivnesses of15teams, and proposes the improvements according to the slacks. Finally, according to thevariances between the actual cost and the double and dynamic cost control standards,determines the reward coefficient of15teams and sets the specific incentive measures.