Research On Activity Based Costing Management Based On Value Chain Theory

With the fast development of economic globalization and information technologies, business environment and management pattern which the enterprises face to have undergone earth-shaking changes. For the enterprises, the target of management changed from maximizing the self interest to maximizing the whole value chain's interest. Enterprise's production management and operation decision-making have already jumped out enterprise itself, the category developed outside gradually of the enterprise, so the traditional cost finding that considered merely on the enterprise's interior production link and assign the manufacturing expense according to the sole standard, has already not to meet the need of the contemporary management. Although the utilization of the activity-based costing in certain degree has solved the malpractice that the traditional cost findings distort the cost seriously, it more attention was on the enterprise's production link. In order to make up the flaw of the activity-based costing, we have to seek the method which can improve the traditional activity-based costing management effectively, and the value chain theory could solve this problem well.Since Pro. Michael E. Potter put forward to the theory of competitive advantage and Value chain in the 80's of last century, value chain has been applied universally in the practice of enterprise management and become an important enterprise management idea and method. The value chain theory is an efficient research implement of competition advantage. The goal of the occurs is necessary for the attainment of value, so it is easier to catch cost essence though carrying out costing management from value standpoint. The value chain theory is a kind of important cost management tool that has the strategic sense. It can help the enterprise to consider the strategic cost problems through the external value chain analysis under a broader background; It may distinguish the enterprise's each item basic or the support activity through the enterprise internal value chain analysis, and carries on the cost value analysis to these value activity. And the activity-based costing management based on the value chain theory is specifically the practical modern cost management, it enables the cost management to penetrate into the most basic work stratification plane through activity chain analysis, cost driver analysis, which guarantees the enterprise can carry out its cost strategy. It can be said that, the value chain analysis method is widely used in the enterprise cost management.This article proposed the activity-based costing management that based on the value chain theory, focuses on the enterprise internal value chain analysis and external value chain analysis, it calculates the enterprise's value chain cost through the activity-based costing and seeks the enterprise's cost superiority and increment link ,then is clear about the weak link of the enterprise's cost management by he activity cost analysis and the achievement inspection, carries on the strategic conformity again and the centralism disposition to the enterprise resources to realize the value rises in value and the building competitive advantage, and realize the goal that the enterprise's lowest overall cost and biggest value.