Cost management - Financial definition
Concise definition of the term cost management
Cost management is the process of planning, controlling, and optimizing expenses within an organization to achieve financial efficiency.
Comprehensive definition of the term cost management
Cost management encompasses strategic decision-making and operational practices aimed at minimizing expenses while maximizing value creation. This involves analyzing cost structures, implementing cost-saving measures, and fostering a culture of efficiency across all facets of the organization, from procurement to production and distribution.
Effective cost management strategies may include activity-based costing, lean manufacturing principles, outsourcing non-core functions, and leveraging technology for process automation. By actively managing costs, companies can enhance profitability, competitiveness, and sustainability in dynamic market environments.