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Media Focus | Professor Shou Yongyi: Gain Profit from Management
Date:2016-05-24 Readed:873 【Print

    Nowadays,the downward pressure is increasing ,which has an influence on the enterprise’s benefit. On one hand ,at home ,reducing the cost from top to bottom will lessen the burden of the enterprise’s external environment .On the other hand,the best way to lower the cost is to start from inside and improve the management capability. Most enterprises are under the pressure of the cost,with the regard that it’s the high cost that lead to the decrease of the profit.In Shou’s opinion,the cost is not the one be to blame,namely,the enterprises are supposed to find problems from inside.In conclusion,the management is the most variable affecting the benefit between the industry.

Shou Yongyi: Associate Professor of School of Management, Zhejiang University

    In recent years ,people are more concerned about the cost.For instance,in Zhejiang province, some Zhejiang businessmen  refuted to ask for order with the fear of the cost pressure.

     The cost pressure exists in every parts of the supply chain.Prof.Shou used the example of the Starbucks coffee to explain the of the cost structure in the supply chain. Although the raw material of the coffee is very cheat,from the logistic perspective,purchasing imported coffee involves the international trade fees and related expenses. Apart from it,manufacturing coffee needs equipment leading to the depreciation allowances.What’s more,the room rental cost and the logistics cost  should also be took into account.Consequently ,it is obvious that the actual cost is totally different from what we take for granted .

     For the manufacturing companies,when receiving the order,money should be put into investment and manufacture,which forming the capital cost.In addition,during the manufacture process,the human cost , depreciation allowances and the logistic cost make up a large part of the cost.In short ,we can’t ignore the existent of the cost and the cost difference between the enterprises exert an influence on the enterprise’s decision making .

     In the past ,we emphasize the marketing capacity ,whereas,under the new normal , the risk management,such as ,the cost management and financial risk management plays an essential role in the enterprise’s development.

    The order assessment ,the buyer analysis and the countermeasures are capacities enterprise should enhance under the circumstance.If these factors are handled well,it will avoid the risks .This kind of management ability is the one the enterprise need most under the new normal.

      We can analyze the cost management from short term and long term. In the short term,the raw material cost and the exchange rate volatility pose a threat to the company.As far as the raw material is concerned ,the volatility of staple commodities price has a significant effect on the raw material cost ,owing to it,once purchasing in a wrong time,the company will have a deficit.In recent years,hedge turn out to be a good way to avoid the risks.

     In the long run,we should emphasize the investment management including the management objects .Most importantly,when it comes to investment we should avoid following the trend without a second thought. For example,in the previous years,some company follow the trend to invest in real estate which take up a lager amount of the capital.As a result,once the company run into risks ,they went bankrupt.

 

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