CC BY
58
♦
♦
equipment on a market prevent emerging of competition. The right-holders may use various schemes to preserve its existing rent-earning status.
Manufacturer often selects different behavior models for separate products, thus competing the representatives both proprietary and interoperable strategies. The manufacturer often chooses various behavior models for single products, thus competing with the representatives of proprietary and interoperable strategies. The manufacturer chooses lobbying of characteristic standardization of its product in relation of the interoperable products. The lobbying of copyright and patent legislature is carried out towards the proprietary products. HTC, Iconbit, Asus are the examples of the companies, following the interoperable model of behavior Apple, Sony, HP are manufacturers -proprietors. It should be noted, that the given examples are of conventional nature: proprietary strategy of Apple company has a rather vivid character, and the product line of Asus net-books is partly proprietary, but a separate distributive Linux - Eeebuntu under the licence of free software GNP GPL is developed especially for them.
Such quality of proprietary system allows to consider any site, restricted by the right of property, ownership, regulation or engineering. It may be park, restaurant or any other establishment territory, in the frames of which the services or sale of goods may be done only by the authorized vendors. It may be the car's saloon, where the peculiarities of the design provide the usage of only the equipment of the authorized manufacturer. BMW Station for Apple IPhone is the example of such model, supplied the BMW cars [4]. The other manufacturers are simply not allowed on this market and don't have abilities to find a final consumer, because the usage of their products will involve significant costs or inconveniences.
The choice of the behavior model on the market is determined by the ability of manufacturer to participate in rent distribution from the equipment usage. If the manufacturer is able to serve and upgrade the equipment, form the authorized complex of services, initiated by the technological
peculiarities of equipment and has the resource for lobbying his interests in a regulator circle, he is inclined to choose a proprietary model of behavior. Under interoperable strategy he may increase the rent from invention due to the standardization of characteristics of his product or increasing of the market share. If the option of strategies is successful the manufacturer possessing a certain market niche can obtain a long-run usage of invention.
The remarkable feature of domestic industry is the absence of its own developments. As a result - domestic manufacturer either can't choose a proprietary model of behavior or suffer increased industrial costs if he chooses it. In the total the product price on the market is much higher than of the competitive models. As consequence, motivation of consumer will be done via protectionist methods or unfair competition (GLONASS). Domestic products of high-tech branches account for less 1%, the economic growth of Russia through technological sectors account for 8%, while in developed countries this index is at the level of 60% [3, p. 4 - 11]. The fact of fixation of timeless right-holding for the objects of copyright, innovations and inventions has negative externalies for society development. Depending on the personal manufacturer's interest there is a lobbying either toughening or mitigating of norms of law. According to the social conflict theory bad institutions appear as a result of absence of profit to groups, possessing political power, or, as in our case, resources or influence leverages. It is necessary to develop institutional norms, promoting motivation of manufacturers to positive externalies of innovations.
1. Civil code of Russian Federation 18.12.2006 № 230-03 (approved by the State Duma of RF in 24.11.2006) p. 4 art. 1259, 1281.
2. Trubnikova H.I. Strategy of interoperability of products under conditions of manufacturers integration // Samara State Economic University.
3. Fedorov I. Engineering training: state, problems, prospects // Higher education in Russia. 2008. №1.
4. URL: (Date of access: 1.03.2011).
удк 338.45 VM Khanin
TRENDS OF TARGET COSTING CONCEPTION IN THE INDUSTRY
Approaches to cost management, developed in a domestic science are considered. The basic methodological positions of a Japanese cost management method are described. Problems and target-costing prospects development and its introductions at the domestic enterprises are established.
Key words: target costing, industry, cost price, competition, enterprise.
B.M. Ханин
ТЕНДЕНЦИИ РАЗВИТИЯ ТАРГЕТ-КОСТИНГА В ПРОМЫШЛЕННОСТИ
Рассматриваются подходы к менеджменту затрат, выработанные в отечественной науке. Описываются основные методологические положения японского метода управления затратами. Определяются проблемы и перспективы развития таргет-костинга и его внедрения на отечественных предприятиях.
Ключевые слова: тарает-костинг, промышленность, себестоимость, конкуренция, предприятие.
Today many machine-building enterprises face the prob- much attention to it. Thus, according to one of the approach-
lem of cost lowering. Modern domestic economists pay es, all costs of enterprises are divided into two groups:
1GG
costs of turnover and production costs. Turnover costs -are summary costs, expressed in a pecuniary form, emerging in the process of turnover of material values, including transportation, storage, etc. Production costs - are total labor and means of production costs, used in products manufacturing. Cost management is treated as planning, audit and analysis [1, p. 54].
From the point of financial management all costs are divided into three groups: costs related to profit derivation, costs not-related with profit derivation, and levied costs. The first costs are the costs for maintaining production processes, costs for products sales. The second group of costs is the costs of consuming character, spent on charitable and humanist purposes. The third type of costs is the taxes and tax payments, different assignments, obligatory insurance costs, etc.
From the bookkeeping accounting cost management is considered as a complex process, embracing planning and rating operations, accounting and analysis of production costs, control over the process of their formation.
All these approaches have much in common, mainly -the enterprise determines the cost limit for product manufacturing, and then establishes its price depending on a planned amount of profit.
We would like to focus on Japanese approach to cost management, where establishing cost is performed in the contrary order. This approach is called target-costing.
Target-costing (cost - target planning) emerged in Japan in 1960-s, but remained unknown during many years. But since 1980-s, when this method was recognized as one of the main factors to strengthen competitiveness of Japanese companies, many firms in the USA and Europe tried to apply it for improving their own cost management, and consequently, to increase their competitiveness.
The “contrary” approach to define cost price of the product (that is one of the most important constituents of target-costing) may be found at the beginning of the last century in Ford' s company, and in development of a Volkswagen “bug” in 1930-s in Germany.
To reach a certain price of DM990 car, Volkswagen Company considered the alternative technical solutions on the basis of costs. The approach to target-costing was completely shaped after the World War Second that was caused by essential scarcity of production resources. In that time Americans created the conception of maximization of desirable product characteristics and simultaneous minimization of its price cost.
The method acquired the name of “cost projecting” and later was accepted by Japanese companies to oppose a tough competition within the country In 1960-s cost projecting was combined with the idea to effect price cost of the product at the stages of product planning and developing [5].
The first employment of a cost projecting in Japan known there as “genka kikaku” took place in Toyota Company in 1963. Later «genka kikaku»was translated from the Japanese language as “target-costing”, - the term is widely used through out the world. And though some specialists, for example U. Kato [6, p. 33 - 47], criticized the translation of the term, it has become generally accepted in the Western World. At the annual meeting of Japan Cost Society in 1995 the method got the official name target cost management, on the ground that the term “tar-
get-costing” is too ambiguous and doesn't render the true meaning of the term «genka kikaku».
The main idea of target-costing is simple: consumer-orientation makes company calculate the price the buyer is ready to purchase goods, and later develop and manufacture the product exactly at this price [3, c. 198 - 204].Price formation is presented on a figure.
Традиционная система ценообразования
Ценообразование при таргет-костинге
Price formation schemes
Thus, a classical scheme of pricing, where price cost of goods is initially shaped, and then increased due to a sales price markup, experience essential changes. At the same time the Japanese scientists are not unanimous in a strict definition of term «genka kikaku».According to T. Khiromoto, “companies not only develop products, applying their technologies and production capacities at most, they design and produce goods, that correspond to price market expectations, which may not be supported by the current capacity of production . This fact is especially important for planning”. M. Sakurai (1989) considers that “target-costing may be regarded as a cost management mechanism in order to decline product cost at all stages of its life cycle (in this case Research and development, marketing, accounting departments are engaged))». Then «genka kikaku»was treated as profit management instrument. Foe example, Y. Monden affirmed that target-costing is defined as profit management in frames of the whole company, and this activity includes:
1) product planning in order that the product quality meets the clients' needs;
2) establishment of costs level for a new product, the expenditures are determined by a necessity to get a requested profit in middle- and long-run perspective under the current market conditions;
3) product development, the price cost of which corresponds to the established level of costs under remained quality indices.
Detailed discussion of various definitions of Japanese scholars is found in V. Seidenshwarts' work [7], who classifies definitions regarding three categories:
- market-oriented (Khiromoto);
- technology-oriented (Sakurai and Monden);
- product function -oriented (Tanaka and Yoshikava).
This diversity indicates that «genka kikaku» hadn't been
developed as it is from any accepted theory, but was being shaped gradually as a result of growth of competition in Japan, that proved versatile nature of the notion. For example, target-costing was closely connected with TQM (total quality management) and programs of production automation in many companies. Versatile nature of the notion “target-costing” is in the scale of its application beyond the
♦
♦
technical aspects that affects firm personnel [2, p. 83 - 87]. For instance, Y Kato and others consider target- costing as a unifying device, which combines various functional units of the company in one harmonized system. Application of target-costing helps to eliminate efficiently the internal communicative barriers between the employees. T Khiromoto underlines a motivation effect of the method and emerging of innovative activity of a staff. He believes that the aim of management is to motivate the staff and ensure them with the means permitting to act in a necessary for a company development way
Even though that the target-costing conception has existed in Japan for more than 40 years, the introduction of the method was very slow, because in many cases firms do not react immediately to the changes of the business-environment. Still as far as competition became tougher and profit dropped consequently, the application of this instrument expanded, and companies could improve the given methodology.
Until the beginning of 1990s many Japanese firms efficiently used target-costing, but its application boiled down to a few goods. This method essentially depended rather on the experience and intuition than objective scientific information. In other cases target-costing was introduced by purchase departments as an instrument of management of suppliers' interrelations. Thus, this method never covered all spheres of the company's activity. It was a widely accepted practice to introduce only some its elements instead of all-embracing system. However, as some busi-ness-processes were integrated, the approach gradually developed in a much powerful system.
At the beginning of 1990s in Japan three great events took place, they promoted a sufficient development of the target-costing conception. The first and the most important was a blow of the economic bubble 1990-1991, that forced many companies strive to meet the clients' expectations by lowering of prices. At the same time, in order to survive in crisis conditions, strategic focus of the largest Japanese companies shifted from the increasing of the market share to profit.
Consolidated efforts, aimed at costs reduction in the scale of the whole company, were focused mainly on the expanding of existing target-costing systems. The second event was increase of the Japanese yen's rate in relation
to USA dollar, started in 1993. To 1995 Japanese yen was estimated to a half of dollar's cost. The currency rate shift of 130-140 yens for a dollar to a record 84 yens for a dollar took place in 1992. As a result export and margin of the Japanese companies sharply dropped. To survive they increased the use of target-costing. A long-run recession in Japan, caused by a crisis in a financial sector, was the third reason, which forced many Japanese to reduce costs to correspond their own plans of profitability.
The conception of target -costing in Russia has become very popular during the last years. Obviously it is connected with the fact, that many enterprises, having made a breakthrough in development after 1998 default due to a price advantage over foreign firms, gradually lose it. Target-costing allows minimizing a possible damage while entering the market with new goods: the price of a product is initially determined by consumers' preferences, but not by its price cost [4, c. 35 - 40].
Thus, a brief survey of development of Japanese method of cost management proved that it had displayed its high efficiency in hard economic conditions. Better understanding of target-costing will help companies in other countries, including Russia, to implement successfully this methodology in their activity.
1. Zaitsev N.L. Economy of industrial enterprise. M.: Infra-M, 1998.
2. Kublin I.M., Vereshchagina L.S. About methodology of formation of the production program of industrial enterprise // SSSEU Bulletin.2010. № 5 (34).
3. Kublin I.M., Voronkova O.V. Trends of improving of market-
ing planning for a machine-building enterprise // Issues of modern science and practice. Association “United university named after VI. Vernadsky”. Tambov, 2008. № 2 (12).
4. Ryabkov A. Target-costing: cost price formation and product price on the basis of marketing computation // Marketing and marketing researches. 2005. № 2.
5. Buggert W, Wielpbtz A. Target Costing - Grundlagen und Umsetzung des Zielkostenmanagements, Mbnchen. Wien, 1995.
6. Kato Y. Target costing support systems: lessons from leading Japanese companies // Management Accounting Research. 1993. № 4.
7. Seidenschwarz W. Target Costing - Marktorientiertes Ziel-kostenmanagement, Mb nchen, 1993.
удк 657.6 A.G. Chernov
NATIONAL RATING ANALYSIS SYSTEM OF INDUSTRIAL ENTERPRISES
The author highlights the existing economic rating and points out the necessity of formation national rating analysis system, independent from the foreign commercial structures. The author offers a methodological approach to the organization of a rating analysis system in Russia, based on the alliance of the state and business communities’ potential.
Key words: rating, assessment of the economic enterprise, rating analyses system, Chamber of commerce and industry.
