Strategic Cost Management Research Based On The Value Chain

Cost management is a summary of the serious of behaviors including accounting,analysis,control and decision-making of cost in the process of enterprise production and operation.The emphasis of cost management is accounting and control,although it contains business strategy in one sense.Hence,the traditional cost management thinking mode eagers for reducing costs.However,to reduce the cost blindly is not only often detrimental to the enterprise to obtain the maximum profit,but also destroys the development prospect of the enterprise.As a result,the traditional cost management thinking mode has not satisfied the rapid development of global business model,the concept of strategic cost management came into being.In other words,strategic cost management is an organic combination of strategic management and cost control,which requires accounting officer to pay more attention to cost structure,cost motivation,strategic environment,strategic planning,strategy implementation and strategic performance.The research on strategic cost management in China is still in the preliminary stage,and the existing cases are mostly enterprises aiming at the cost leadership strategy.Nevertheless,the case chosen in this article----Geely group,is a witness of the development of China’s automobile industry.Geely was known by the world car industry for purchasing Volvo.In addition,Geely announced the acquisition of a 9.69% stake in German auto giant Daimler AG,and became the largest shareholder of Daimler AG.Therefore,Geely can be considered as the most active Chinese automobile company in the international automobile capital market.Therefore,we choose Geely group as the research object to explore the strategic cost management in every link by the value chain analysis,the strategic location analysis and the strategic cost driver analysis.We will do the research in case study method,and the paper can be divided into six chapters.Chapter one introduces the backdrop and materiality of the research,catalogue and research methods and framework.In addition,the second chapter mainly discusses the strategic cost management theory of domestic and overseas research situation.And the third chapter summarizes the basic theory of strategic cost management.The fourth chapter introduces the use of strategic cost management in domestic and foreign automobile industry.Then we will analyze the using of strategic cost management in Geely group through the value chain analysis,the strategic location analysis and the strategic cost driver analysis in the fifth chapter.Finally,the last chapter will draw conclusions and give suggestions.