Strategic Cost Management Research On Shipping Enterprises

The integrating global economy compels shipping enterprises to compete intensely in the market. In order to set up competitive competence, to heighten the cost management to the level of the strategic stature is very important. Strategic cost management (SCM) extends the meanings of cost-driver defining in traditional cost management and enriches strategic methods. SCM is the combination and connection of strategy and cost management, and a logic process of using strategic cost information to carry out a strategic decision-making and organizing the cost management to service the competitive strategy. As ship enterprises are of transportation industries, strategic cost management research is made under this special interior and exterior environment.This paper combines the theory research with practice, which studies the strategic cost management in ship enterprises. At the beginning, it works on the theory frame of SCM and illustrates the environment, objective, characteristic, proceeding and analysis of SCM. Basing on the study of interior and exterior environment of ship enterprises, it makes a complete analysis in terms of value-chain and strategic orientation, and finds out the non-value added, unreasonable activities and choke points which restrain the cost reduction. By reconstructing the value-chain, it focuses on the activities with competitive predominance, confirms enterprises' strategic objectives and relevant cost management strategy. For the sake of realizing enterprises' strategic objectives, defining the emphasis of cost management, controlling the cost and assuring the correctness and validity of cost management strategy, it adopts structural cost driver and executive cost driver methods to study ship enterprises. Afterward the paper combines the research results to discuss the performance appraisement of strategic cost management. It gives a new way of strategic cost management in ship enterprises and provides a suit of implementary project to reduce cost, to heighten the competence and to maintain competitive predominance, and finally to keep the ability of make profits in a long time.