Analysis Of Strategic Cost Management Based On Value Chain

With the fierce competition among the major enterprises in the contemporary society,and with the constant changes of the internal and external environment of enterprises,higher requirements are put forward for the cost management of enterprises.The cost management of enterprises has an important influence on the formation of competitive advantage in the market.,and the enterprise needs to improve its cost management continuously.Because the traditional cost management only pays attention to the reduction of the short-term cost of the enterprise,it can’t help to improve the management level of modern enterprises.Many foreign companies have begun to adopt strategic cost management based on the value chain,and have achieved good results.With the help of value chain analysis tools,the enterprise’s cost management is promoted to the strategic height,and the cost of the enterprise is reduced from the perspective of the internal value chain and the external value chain,and the operational efficiency of the company is improved.While optimizing and improving the internal value chain of the enterprise,the rational use of the resources of the external value chain of the enterprise can better enhance the competitiveness of the enterprise in the market.Therefore,the strategic cost management based on value chain is more and more valued by modern enterprises.At present,the market of home appliance industry in China is in a saturated state,and it is facing multiple pressures such as foreign brand impact,customer consumption upgrade and production cost increase.After years of continuous development,S company has become the leader in China’s home appliance industry.Through the value chain analysis tool,it has certain practical significance to analyze the strategic cost management strategy of S company.This paper uses case analysis method,comparative analysis method and literature research method to carry out in-depth research on S company’s strategic cost management strategy.This article first elaborates the relevant theories of the value chain and strategic cost management,and describes the relationship between them,leading to the strategic cost management based on value chain.Then,the company was introduced with a case,and the specific application of the strategic cost management strategy of S company in the internal value chain,industry value chain and competitor value chain was carried out in-depth analysis,and its effectiveness was evaluated.Finally,the strategic cost management of S company is summarized,and some enlightenment is provided to the relevant home appliance companies,which has reference significance for the company to control costs and improve their market competitiveness.Through the specific analysis of S company’s strategic cost management strategy based on the value chain,it is concluded that enterprises can reduce the cost by improving the internal value chain of the enterprise,deepening cooperation with upstream and downstream enterprises to improve operation efficiency,and integrating the value chain to enhance the market competitive advantage of enterprises.It is hoped that this paper can help contemporary enterprises to enhance their competitive advantage by optimizing the strategic cost management.