Course detail

Strategic Cost Management

FP-srnPAcad. year: 2021/2022

The course deals with methods and procedures for strategic cost management and the use of cost functions in price decisions and designing pricing strategies, methods and procedures for calculations and their application in decision-making tasks of strategic cost management in companies and non-profit organisations. The course focuses on modern tools of strategic cost management, decision-making tasks, the use of the ABC methods and the related method of process and activity management (ABM). The course mainly provides information for strategic cost management and, in particular, information for decision-making in practice.

Language of instruction

Czech

Number of ECTS credits

5

Mode of study

Not applicable.

Guarantor

prof. Ing. Alena Kocmanová, Ph.D.

Department

Institute of Economics (ÚE)

Learning outcomes of the course unit

Students will understand the importance and need of strategic cost management for companies and non-profit organisations and their interdependence with managerial accounting and control. Students will take the theory of managerial accounting as a basis and know the strategy of cost management; they will also know the information about past phenomena, as well as the information necessary for decision-making – tools of calculation methods and decision-making tasks. Upon completion of the course, the students will be able to evaluate the results achieved, find shortcomings, propose their solutions and make justifications and decisions from the point of view of the strategic cost management.

Prerequisites

Students are expected to have general economic knowledge.

Co-requisites

Not applicable.

Planned learning activities and teaching methods

Lectures consist of an explanation of basic principles, methodology of the discipline, problems and their solutions.

Assesment methods and criteria linked to learning outcomes

The credit is composed of professional skills, which are verified on the basis of one control test. The student can reach a maximum of 40 points (minimum score of the test is 25 points).
The examination consists of professional knowledge which is verified by written and oral exam. At the written and oral exam, the student will be asked professional questions from the theoretical part defined by lectures from the given area of strategic cost management. Students are classified according to ECTS classification scoring rating scale, max. 60 points.

Course curriculum

1. Content and concept of cost and strategy management. Use of cost management. System approach to cost management. The current international business environment. The strategic focus of cost management.
2. Concept of strategic cost management, factors influencing strategic cost management (TQM, JIT, The Theory of Constraints).
3. Breakdown of costs and revenues from the point of view of management needs oriented at decision-making; opportunity costs.
4. Decision-making tasks; basic classification aspects of these tasks; strategic role of CVP (Cost-Volume-Profit) analysis. CVP analysis for planning the break-even point; CVP for planning revenues/income and costs/expenses.
5. Decision-making tasks on production volume optimization, range of products optimization and decision-making tasks “either or”.
6. ABC method (Activity-Based Costing) – calculation by partial activities (use in manufacturing companies, non-profit organisations). ABC and strategic cost management.
7. ABC/M method (Activity-Based Costing and Management) – process and activity management.
8. Target costing and life cycle costing.
9. Strategic cost estimates. Methods of cost estimation. Analysis. Regression analysis.
10. Cust cutting – alternative cost cutting approaches.

Work placements

Not applicable.

Aims

The aim of the “Strategic Cost Management” course is to acquaint students with methods and procedures of strategic cost management, using cost functions for price decision-making and designing pricing strategies, with the methods and procedures of calculations and their application in decision-making tasks of cost management. Students will also learn about modern tools of strategic cost management, TC and LCC, the calculation of costs according to partial activities (ABC) and the related method of process and activity management (ABM); these tools are widely used in foreign companies. Upon completion of the course, students will be able to use these tools for various decision-making tasks related to the management of costs and strategies in manufacturing companies and non-profit organisations.

Specification of controlled education, way of implementation and compensation for absences

The checking during the semester is based on the completion of the test. In the case of excused absence from seminars, teacher can, in justified cases, set a alternative condition - usually the procession of the alternative.

Recommended optional programme components

Not applicable.

Prerequisites and corequisites

Not applicable.

Basic literature

KRÁL, B. a kol. Manažerské účetnictví. 4.aktual. vyd. Praha: Management Press, 2019. 790s. ISBN 978-80-7261-000-00. (CS)
ŠOLJAKOVÁ, L. Strategicky zaměřené manažerské účetnictví. Praha: Management Press, 2009. ISBN 978-80-7261-199-7 (CS)

Recommended reading

BLOCHER J. E. et al. Cost Management – A Strategic Emphasis. Published by McGraw-Hill/Irwin, 2016. ISBN-13: 978-0077733773.
DRURY, C. Management and Cost Accounting.Cengage Learning EMEA, 2016. ISBN 978-1-4808-9393-1.

Elearning

eLearning: currently opened course

Classification of course in study plans

  • Programme MGR-MEO Master's 2 year of study, summer semester, compulsory
  • Programme MGR-SRP Master's 2 year of study, summer semester, compulsory

Type of course unit

 

Lecture

20 hod., optionally

Teacher / Lecturer

prof. Ing. Alena Kocmanová, Ph.D.

Exercise

10 hod., compulsory

Teacher / Lecturer

Ing. Markéta Kruntorádová, Ph.D.

Elearning

eLearning: currently opened course