Target Costing: The Key To Supply Chain Excellence

This paper provides a descriptive and qualitative analysis of how cost management practices should be redesigned to accommodate a shift from traditional management to value chain management strategies. First, the drawbacks of using traditional cost management techniques will be examined. Second, the advantages and disadvantages of using activity-based management will be explored. Finally, target costing and its impact on supply chain performance will be investigated through case studies. Our case studies illustrate how companies achieved better supply chain performance through integrated cost management techniques.