Based On The Objectives Of The Strategy Cost Management In The International Engineering Contracting Projects

With the continual development of the market economy, especially the entering WTO, the course that our economy integrated with the world economy is expedited. At the same time, due to the world economy is changing from industry economic to knowledge economic, information technology is developing swiftly, and the owner's demand is growing individually and changeably. As the result, the competition in the international engineering contract market is more and more violent. To conform with such environmental change, the management mode and methods of international engineering project are innovated. The project management methods according with the international convention are introduced into our international engineering enterprise and are generalized among them.The cost management is the essential road of making persistent profit for international engineering enterprise which as economic substantive. Looking back to the traditional project cost management, we can find they are all limited in the tactical level. Some theories and methods have not met the engineering management's requirement now. So the international contractor must cultivate their continual competition advantage on the strategic level.This thesis begins with the change of the international engineering cost management. After analyzing the limitation of traditional project cost management, the author puts forward a new cost management method: target cost management based on strategy. The author expounds the theoretic structure of this method, and analyzes its practical application in a certain international project.The thesis is divided into four parts:In the first part, the author illustrates the concept of the project costmanagement and explains it's connotation, then analyzes the application background and the significance of the project cost management in the international engineering contract industry. The author also analyzes the limitation of traditional cost management in its conception, target, instruments and content.The second part is the key portion of this thesis. The author expounds the theoretic structure of target cost management based on strategy. Firstly, analyzes the principle of target cost management based on strategy. Secondly, expounds the contents of target cost management based on strategy, including its target, procedure, principal and characteristic. Last, introduces its analyze instrument.In the third part, the author expounds the proper cost management factors in the international engineering project and their control keys. Including equipment cost, material cost, labor cost, management cost and financial cost.In the fourth part, the author analyzes the method's practical application in a certain international engineering project:Yalong hydropower construction project, including cost forecast, cost decision-making, cost plan, cost control and cost management evaluation.