The Total Cost Controlling System Application Analysis In The Manufacturing Industry

This article main discusses how to apply the total cost controlling system in the manufacture company. Nowadays many theories study all sorts of special cost controlling way, but in China the total cost controlling is not popularization. In fact, there is 3 sides in total cost concept: investment cost, business cost, meeting emergency cost.In a good performance company only when you make the total cost down, you can make profit, or you will lose money in the future instead of making profit. If you keep eyes on one special cost item, omit total cost target and do not estimate total cost, you will have to pay more money in the future. So the total cost will increase. The key point of this article I try to establish a total cost controlling system. In this article I will use systemic theory, balance score theory and etc. to make key performance item (KPI) to control overall cost. And I will prepare KPI chart and analysis report to business managers to make prompt decision. We will make cost and KPI target. KPI is a tool to estimate that the total cost controlling system is running well. In the company we can use all cost management technique and integrate all the cost controlling way to reduce cost. The key point is how to apply total cost controlling system in the manufacture company. In this article I will apply total cost controlling system in manufacture based on the cost management practice of the company named F. The system single target is to make the total cost down and reach the business target. In order to get it, we will organize special person to execute the system and we should execute it from the top down to avoid counterwork. So we can get the total cost down systemically.