Research On Strategic Cost Management Of XH Oil Company

With the development on management, companies' requirements on cost management keep rising and the traditional cost management mode can not meet the requirements for modern companies, especially for the oil companies whose value chains are so complicated. Due to the high homogeneity of the oil goods, the competition in oil industry mainly is price competition which comes down to cost competition. Nowadays, in the more competitive oil market, how to make the cost management innovation of oil development by using strategic cost management theory has a great theoretical and practical significance.This paper based on the strategic cost management theory and uses the analysis tools. Firstly, this paper analysis the operation environment of XH company; Next, it analysis the cost management by using the value chain and cost driver as analysis tools, and compare XH company with the competitors to find out the problems in the cost management. At the same time borrow ideas from these competitors to build the strategic cost management system of XH company, thus to find the solutions and future development for strategic cost management of XH company.Through the research of this paper, it built a good foundation for the innovation for the strategic cost management of XH company. It also helps to set up an effective low cost development strategic, to improve the operation and management and to enhance the competitive advantage of XH company.