The Study On The Strategic Cost Management For Z Company

Nowadays, with the trend of The Great Western Development Strategy, plasticconstruction material industry in Xinjiang has been growing rapidly. The boomingdemand for related products shows great market potential. Company Z is aState-owned Enterprise plastic construction manufacturer. The company’s majorproducts are Glass Reinforced Plastic (GRP) pipes, Polyvinyl Chloride Polymer (PVC)water supply pipes, PVC profiles, Polyethylene (PE) gas and water supply pipes, andwindow and door frames. Since inception, Company Z has gradually captured marketshare with continuous effort and successfully gained its current position in theextremely competitive market.The previous cost control methodology of Company Z has achieved someprogress with a focus on cost-cutting. However,the company is lack of amarket-oriented strategic system,as the competition intensify, the control cost of thecompany has been growing at a higher rate than that of revenue and suffered profitloss in2013, due to rising cost of raw material and labor. The limited company vision,in term of lack of strategic support to cost management, has become an importantfactor to hold up company’s development.This article introduces current condition of global studies on corporate strategiccost management and carding through related theories. Then the article moves itsfocus to the analysis of Company Z’s current status on cost management andidentification of related issues. At last, a thorough analysis on Company Z isconducted with multiple methodologies, and a strategic cost control model isestablished based on the company’s strategic positioning and related theory ofstrategic cost management. The article also proposes a few protection methods toassure effective implementation of the company’s strategy.The article leverages theory study, case analysis and other methodologies todevelop Company Z’s strategic cost management solution with philosophy ofcombining “strategy and cost management”. The objective is to increase the CompanyZ’s competency level with advantages in costs.