Sustaining Competitive Advantage through Strategic Cost Management (Essay Sample)

STRATEGIC COST MANAGEMENT
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The adoption and implementation of low-cost leadership can help organizations increase their sales, market shares, profitability, and competitive advantage. However, strategic cost management has also been proved to achieve the same. Strategic Cost Management (SCM) is a technique that has been used to reduce the total costs of business, bringing about competitive advantage while also improving the various strategic positions of companies (Anderson, 2006, p. 26).
In increasing sales of the organization, the Strategic Cost management approach helps understand various costs that support the company's strategic positions. These costs weaken it or do not bring any impact on a business. Strategic Cost Management aims to align and manage costs to be the same as the company's strategic operations. Strategic Costs Management can, in turn, help organizations gain a competitive advantage with objectives of outperforming the other emerging competitors to dominate the market. This leads to an increase in sales as more people get comfortable with the associated costs. It also helps guide the organization to make sure the necessary changes are evaluated in the business world (Henri, Boiral, and Roy, 2016, p. 270). These changes may come from an internal environment that is introduced by managers such as policy changes in the businesses, and various procedures carried out and also change in the external environment such as changes in the rules governing the firms by the government, from competitors, and change of taste and preferences