Research On DaFu Company's Cost Control Under The ERP Environment

Cost is the key to evaluate the competition of a company, and how to lower the cost becomes the most important issue for a company to survive. However, some of problems, such as no efficient information communication, few procedure monitor, illogicality fee sharing, not best cost control, without scientific cost management and so on, make it difficult to cut and control the cost for the traditional production company.This paper is to introduce the ERP theory and apply it to DaFu Company to lower its cost. To apply the ERP theory to DaFu, we need to study the current situation of DaFu Company, find out the cost problems and the reasons. Once we find out the cost problems, we can optimize the cost control with ERP in DaFu Company.Under the Global Economy, China is becoming the center of the production. With the theory of Michael Potter's enterprise competition, cost is becoming the most important strategy for a production enterprise. In USA and Europe, one of most successful theory for cost control is ERP. So it is necessary to study ERP theory and apply it to the enterprise in China.The first part of this paper is introduction. In this part, I introduce the background of theory.In the second part, I explain what cost control is. In this part, I study the situation of the application of cost control theory in China and other countries. It is also necessary to study the Production Cost Method and Standard Cost Method, ERP and its application in the cost control.In the third part, erp based actuality analyse of cost control.Information communication, procedure control, recourse sharing, cost control and cost management are the key issues for ERP theory. Through the study of these issues in DaFu company, we can find out why the cost in the DaFu company is so high. These will be useful to provide evidence why DaFu need to apply ERP cost control.In the fourth part, I propose how to improve and adjust the ERP theory to apply this theory to the DaFu Company. I suggest that DaFu should establish a more efficient communication system and a platform for procedure control. These two are the key issues to lower the cost of management and cost control. With the law of Production Cost and the Standard Cost, DaFu can control its production cost and establish a Cost Management Support System. In the fifth part, I forecast how much DaFu can save its cost if DaFu implements the ERP cost control.