Research On Construction Of Strategic Cost Management Process And Its Application

As a production of the combination of cost management and strategic management, strategic cost management is an adaptive evolution with the competitive environment from the traditional cost management. In recent years, this method has become a powerful weapon to strengthen enterprise cost management and gain competitive advantages for the west. In the long-term Chinese enterprises management practice has engaged in exploration of scientific and effective ways of cost management and accumulated a lot of experience, but methods of cost management still need to update and improve. In view of the cost management issues, some domestic scholars have begun introduce strategic cost management theory in recent years. Their corresponding comments and suggestions on situation of China's cost management has played a certain role in the management improvement. However, what should be noted is that strategic cost management haven't play full use of its practical guidance on mainland as a result of the short-time introduction, especially the introduction focusing on the theoretical framework and weakening the study of its application.This thesis attempts to approach the docking between strategic cost management theory and its practice from the perspective of sector value chain analysis and planning so as to break through the stage of pure theory study of strategic cost management. Based on a profitable exploration into the contents and methods of strategic cost management, it not only constructs a clear and systematic strategic cost management process but also provides case analysis to verity it, with the aim of offering a workable and validate process frame for enterprises' strategic cost management practice. Under the guidance of this study theme, the paper mainly contains the following five sections. Firstly, it states its background, significance, study thought and methods of the essay. Secondly, it reviews and sums up strategic cost management's connotation, its three analytical tools and its implementation methods. Thirdly, it puts forward the study issue, i.e. the issue of docking strategic cost management, in combination with analyzing Chinese current cost management. Fourthly, according to the principle of being objective, strategic and dynamically adaptive, it constructs a strategic cost management process with operational value. The interpretations of each module are also explained in this part. Fifthly, by taking the example of application of strategic cost management in FA Carpet Co. to analyze and check the process constructed, conclusions and inspirations are drawn to provide a reference to other strategic cost management's practice.