Report on Strategic Cost Management - doc
Added on 2020-06-05
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Business DevelopmentFinanceLeadership Management
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Strategic Cost Management
Table of ContentsINTRODUCTION...........................................................................................................................1NATURE OF TOYOTA'S BUSINESS .....................................................................................1STRATEGIC COST ACCOUNTING TOOLS ADOPTED BY TOYOTA .................................2PERFORMANCE OF TOYOTA ..................................................................................................3RECOMMENDATION...................................................................................................................4REFERENCES................................................................................................................................6
INTRODUCTIONOne can only think about two ways of increasing profit, increase sale or decreaseexpenditure.Strategic cost management Focuses on minimising the total cost, it also concentrateon strengthening the strategic position of an organisation (Nixon and Burns, 2012). It helps acompany in improving their production and operational activity. If a company adopt right plansthen they can get some extra edge over their competitors. SCM support an enterprise by makinga clear cost structure, it reduces various kind of confusions that can come in the mind ofmanagers (Netland and Aspelund, 2013). Sometime increasing some cost can be beneficial for acompany, this increased expenditure can help in attaining more profit in less time period. Thisreport will discuss about profile of the a chosen company. Various strategic cost accounting toolsthat is adopted by the firm will also become part of this file. Some comments regardingperformance of the organisation will be included in this report. Both financial and non-financialareas will be explained at the time of commenting on company's performance. Ownrecommendation will be present at the end of this assignment. This report is based on Toyota.This corporation is considered as one of the most successful corporation in auto-mobile sector(Karjalainen, 2011).NATURE OF TOYOTA'S BUSINESSToyota Motor corporation is a Japan based multinational company, their revenue isaround 2.32 trillion Yen and almost 365000 people are working in this firm (Chiarini, 2012).This organisation is manufacturing and selling motor vehicles. This enterprise have manysubsidiary firms like Lexus and they are running their business in different part of this world.Toyota was the first company who made 10 million vehicles in a year. Auto-mobile industry iscontinuously growing and they are earning huge amount of profits. The sector has seen manychanges because of technology and strict environmental rules made by government. When a firmoperates in at such a large level then they face various kind of difficulties in making fastdecisions (Zimina, Ballard and Pasquire, 2012). This industry saw depression at the time of world wars but besides it has not face anymajor setback. Government of Japan made many favourable policies for this sector and this canbe considered as the prime reason that Toyota became leader of this industry for a significantamount of time. This enterprise has a sound production system which is popular by the nameToyota Production System (TPS). Its main aim is to produce high quality at a low cost and in1
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