Cost Management Strategy Of An Advanced Material Joint Venture

Manufacturing industry is in a certain condition of important strategic period for development.Manufacturing enterprises need to resolve various risks and challenges,seize development opportunities,and realize self-upgrading and innovation.Especially,traditional manufacturing enterprises need to have more courage of reform.They have to adapt to and embrace the changes of the market to achieve enterprises development.As an advanced material type of joint venture,MG company has typical characteristics of traditional manufacturing industry.The main problems which MG company is facing are slow sales growth,rising internal cost and the weaker profitability.This paper analyzes the root of those problems and puts forward some effective suggestions and countermeasures from the cost management perspectiveThis paper applies the theory of cost management,combining with the methods of standard cost system,target cost management,total cost management thought and continuous improvement.It studies four key existing problems of MG,including the conflict between cutting price from customers and rising cost,new products competitiveness weakening,cost management issues,insufficient synergy of cost management and business activities.Firstly,aiming at the problem of rising cost,this paper analyzes the present ways of reducing cost and finds the disadvantages of them.It is proposed that it is necessary to explore the internal driving force of enterprise cost optimization.The problem can be solved by establishing a cost optimization system based on continuous improvement activities.Secondly,in view of the problems in cost management activities,it is considered to improve the management level of cost analysis The problem can be solved by setting up the modular cost information system based on standard cost management.Thirdly,according to the problems of cutting price from customers and the competitiveness of new products,the paper puts forward the thought of focus on customer service.The problem can be solved by forming all aspects of cost management process.MG company should strengthen pre-event cost management,eliminate customer’s pain points and build new competitive advantage by depending on their technical advantage.Finally,to align cost management with business activities,the paper puts forward the idea of cost and business integration management,forming high cohesion through coordinated development and common goals,breaking down inter-departmental barriers,and realizing the unity and integration of cost management and operation activities.The operation and practice of MG company have verified the effectiveness and reproducibility of the cost management strategy.