Tag Archives | Strategic Cost Management

Strategic Cost Management | Accounting

The strategic cost management (SCM) is a fundamentally new way of managing an organization. It comprises: (a) A strategic analysis of the business to identify unprofitable products, customers, marketing and distribution channels, etc. (b) An evaluation of the business from a value chain perspective. Linkages, both internally and externally, are taken into consideration. (c) The […]

Strategic Cost Management: An Overview

In this article we will discuss about Strategic Cost Management:- 1. Meaning of Strategic Cost Management 2. Importance of Strategic Cost Management 3. Advantages. Meaning of Strategic Cost Management: In global competitive environment, the most efficient firms view all of their spending as an investment. They make efficient spending decisions based on a strategic vision […]

Strategic Cost Management: Top 12 Techniques

The following points highlight the top twelve techniques involved in strategic cost management. The techniques are: 1. Activity Based Costing (ABC) 2. Target Costing (TC) 3. Total Quality Management (TQM) 4. Benchmarking 5. Business Process Reengineering (BPR) 6. JIT Inventory Control System 7. Balanced Score Card 8. Kaizan Costing 9. Six Sigma 10. Life Cycle […]

Problems of Cost System in Indian Companies

The following points highlight the seven major problems of cost system in Indian companies. The problems are: 1. Inadequate Capturing of Direct Material Costs 2. Excessive Emphasis on Labour Costs 3. Functional Classification of Overhead Costs 4. Simplistic Allocation Bases 5. Inadequate Attention to Service Departments and Service Organizations and Others. Problems of Cost System: […]

5 Main Applications of Strategic Cost Management

The following points highlight the five main applications of strategic cost management. The applications are: 1. Product Costing 2. Make or Buy Decisions 3. Marketing Channel Decisions 4. Product Design 5. Activity Analysis. Strategic Cost Management: Application # 1. Product Costing: In many companies, product cost information available is deficient. It is important to capture […]

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