Study Of R & D Unit Cost Management Issues

With the continued development of market economy and advancement of institutions reform, a few public research institutions are moving towards market and influx to the tide of reform and market economy. A mechanism, which has been used long before, makes most public research institutions weakly awareness of the cost, consumption of resources seriously and input multi-output low. For these public research institutions, it is difficult to adapt to the market requirements of rapid economic development. Therefore, it is imperative for public research institutions to change the concept of financial management, and introduce cost accounting into the whole process of operational activities. Additionally, it is very necessary to establish cost management system of public research institutions, strengthen cost control to improve project management level and promote the development of social and economic benefits.This paper first analyzes the characteristics of public research institutions and model of financial management. Resting on modern ideological basis of cost management theory and using ideas and methods of cost management, this paper points out that there are several widespread problems in the cost management of public research institutions:first, arbitrary cost and less attention to cost management; second, high personnel costs while low per capita contribution; third, too simple cost accounting method and no canonical management; fourth, the limitations of cost accounting. These problems are mainly due to many reasons, such as an ambiguous cost management goal, lacking a scientific cost accounting system, an imperfect management system and lacking assessment mechanisms, and certain impacts on administration of the various special funds which works on costing, and so on.As public research institutions with the dual property for public welfare and efficiency, this paper views that the goal of cost management of public research institutions is to make cost-effective optimization. However, the previous cost management pays more attention to cost reduction to improve profitability. Apparently, the traditional management concepts and models have fell far behind with the times. Changing market competition and more urgent internal pressures require the establishment of the ideological concept of strategic cost management, the use of scientific methods of cost management, and reduction of operating costs of institutions. Then it can make public research institutions maintain and create competitive advantages of sustainable development.This paper takes the case of BZH Institute in Chengdu as an example and researches on related issues on cost management. It firstly introduces Strategic Cost Management, overall cost control system and target costing system to the work of cost management. That is, letting BZH Institute based on the overall development goals and the level of pre-defined standard costs, determining the overall target cost from the global perspective, and then decomposing overall target cost to responsibility cost centers. The main cost control are personnel cost, direct cost of operations, daily public charges, development fund, and depreciation of fixed assets. Then it combines with the cost of content development of relevant measures to form a feedback mechanism, analyzes and adjusts on the difference in time. Finally, it assesses overall cost-effectiveness, implements the incentive mechanism and prepares for the next round of cost management. BZH Institute initially establishes a suitable workflow of cost management.Through this study, the author tries to introduce a new model of cost management, change the original concept of financial management of BZH Institute, improve the efficiency of cost accounting and control then ultimately create more incomes. The author hopes this attempt would attract more enterprises to explore innovation of cost management which is suitable and increase awareness of cost management of institution, then create concepts, methods and models of cost management which are adapted to the times.