Study On Strategic Cost Management Of Midea’s Value Chain

Under the background of economic globalization and supply-side reform,enterprises should reform the cost management method with the personalized and diversified needs of customers as the driving force.From the perspective of value chain,strategic cost management links cost management with strategy,promotes enterprises to achieve the overall strategic objectives quickly,and enhances enterprises’ competitive advantage.As a famous enterprise in China,Midea implements strategic cost management around the whole enterprise value chain: by creating a two-tier,four-tier research and development structure,flexible and perfect production line,implementing advanced technology innovation and other strategies,enhance the internal value chain of the enterprise.Through strategic alliance,sales oriented production,digital supply chain management and overseas market layout,the external value chain has been optimized and a relatively perfect system has been established Complete value chain,effective integration of internal and external resources.The research shows that through the strategic cost management measures of value chain,the enterprise has achieved good results,effectively reduced the cost of strong links in the internal and external value chain,and improved the key financial indicators.It mainly includes: improving production efficiency,optimizing product cost structure;external industrial chain synergy,greatly reducing storage costs,expanding overseas markets and revenue of major competitors;Financial capacity has steadily improved.This paper first describes the research background,significance,methods and ideas,and then reviews the important research results on value chain and strategic cost management at home and abroad.Based on the theory,this paper analyzes the strategic positioning of the group by using the industrial environment five forces model and SWOT model,and then analyzes the strategic cost factors and the internal and external value chain of the group.Study the effect of cost management and make financial evaluation.The results show that Midea:(1)the advantages of the internal value chain are improved to achieve the leading products;(2)the orientation to customer demand,product cost reduction;(3)information sharing within the industry chain improves operational efficiency;(4)the global market is expanding with significant synergies.