Costs Count in the Strategic Agenda
Financial Times (11/06/00) Vol. 13, No. 7 p.6; Hopwood, Anthony

Strategically efficient companies do not just identify costs, but rather target ways to change cost structure to better serve corporate objectives. Creating blueprints for what method a company should take to adapt cost management practices in the face of new strategic necessities is not a simple task. Often, commercial solutions offered by consultants and accountants are oversimplified and cannot truly deal with the complexity of the challenge. Here are some principles to follow: first, managers should attempt to form their costs to suit medium- to long-term corporate objectives; cost management should be a multi-functional activity; calculations needed to measure and alter costs strategically should be neither bureaucratic nor complex, all of which makes life difficult for accountants.


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