The relationship between strategy and target cost management system-a comparative case study on two domestic enterprises
Authors:Wen-Ying Wang;
Journal: Chia Da Management Review. Dec. 2007, 27(2): 203-248.
Keywords: Target Cost Management;Management Strategy; Contingency Model; Case Study Method
Abstract:
To verify the contingency model, this study investigates the relationship between corporate strategy and target cost management system. I use
the case study method to examine two domestic automobile enterprises. The implementation processes are explored and comparative analyses are
implemented from three perspectives: organization management type, target cost management process, and the relationship with suppliers. The
results are as follows. (1)The target cost management system assists the implementation of management strategy. Consequently, to carry out the
strategy into day-to-day management activities, enterprises should consider what strategy they take when designing or choosing the operational
ways of target cost management system. (2)The management strategy does affect the implementation processes of target cost management system.
The implementation content and method of target cost management may differ among firms with different strategies. (3)No matter what strategy
is, there are some commonalities that companies should emphasize on or adopt when implementing target cost management.