What is one purpose of strategic cost management?

One important purpose of strategic cost management is to align cost management with overall business strategies. This involves ensuring that cost management practices directly support and facilitate the organization's broader strategic goals. By doing so, organizations can effectively allocate resources, optimize operational efficiencies, and enhance competitiveness in the market.

Aligning cost management with business strategies allows companies to make informed decisions regarding pricing, investment, and resource allocation, ultimately leading to improved profitability and sustainability. It encourages a holistic approach, where cost considerations are integrated into strategic planning rather than being viewed as a standalone function. This focus on strategic alignment is vital for adapting to changing market conditions and achieving long-term objectives.