Strategic Cost Management
Year / Semester: 
4th Semester

This course aims at providing the student the understanding of cost management as a strategic tool for the management of the organization.


Introduction: Cost Accounting versus Cost Management , Cost Management the Basic Philosophy, Cost Management its scope and relevance ,What is a Cost Management System (CMS)? , Scope of a CMS, Strategic Relevance of a CMS; Strategic Management An Overview: Objectives and Goals, Situation Audit, Benchmarking; Strategic Alternatives: Evaluating Achievements Accounting and Reporting Implications; Value Chain Analysis; Strategic Positioning; Activity Based Costing and Management; Total Quality Management; Customer Orientation in Business: Mass Customization Target Costing, Life Cycle Costing, Product Profitability Analysis, Customer Profitability Analysis Channel Profitability Analysis, Distribution Cost Analysis; Managing Business Processes: Value Analysis and Value Engineering Control of Wastage, Spoilage and Defectives Disposal Management Continuous Improvement (Kaizen) Business Process Re-engineering Total Preventive Maintenance Energy Audits Safety Audits Automation, Computer Aided Design and Manufacturing Value Added Management, JIT Scheduling, Theory of Constraints, Cost Driver Analysis, Economics of business process outsourcing; Productivity Measurement and Control; Measuring Marketing Effectiveness; Decision Making: A Strategic Emphasis; Employee Involvement and Commitment: Total Employee Involvement (TEI) Shop floor Democracy Lateral Thinking Mentoring versus policing Recognition and Reward; Strategic Performance Measurement: Financial Performance Measures Non-financial performance indicators Risk measurement Predictive Models; The Balanced Score Card; Making Corporate Boards Accountable: Management and Operational Audits Cost Audit under the Companies Act Environmental costs: measurement and control Making Audit Committees effective

Suggested Readings: 

1. Cost Accounting A Managerial Emphasis Charles T. Horngren and George Foster
2. Advanced Management Accounting Robert S Kaplan Anthony A. Alkinson
3. Management & Cost Accounting Cohn Drury
4. Principles & Practices of Cost Accounting Ashish K. Bhattacharya
5. Quantitative Techniques in Management N.D. Vohra