5 Questions for Better Cost Management Discussions (Industry Week Series Part 1)
Hello Cost Management aficionados!
We have an exciting new series that our managing partner, Eric Hiller, is writing for Industry Week, who has eagerly accepted all the content. The series is all about how an executive (and other people who are not cost experts) can understand what the cost management team is communicating. The first in the series was just published yesterday. Here is a short snippet as a teaser:
A big part of the communication problem is that there is not just one type of cost model. Cost management is a broad field with a variety of methodologies to address the almost infinite world of situations for which one wants to know the cost of manufacture or service delivery. Even if an executive has some understanding of one particular cost-modeling technique, it can often be confusing when the analytics team uses different technique.
This can lead to uncomfortable meeting, where executives and colleagues outside of the cost management team are confused how to understand the results and/or have low confidence in the results. Conversely, the cost management team may feel frustrated that executives are not listening to them or do not trust their conclusions.
What is the solution? The short answer is that the product cost management team needs to better educate their audiences, not only on their results, but how they got to those results. In addition, it is incumbent upon their colleagues to be willing to learn, and invest the time to become conversant in the terminology of cost management just like they would in other function areas, e.g. product development, purchasing, finance, etc.
Please click this link to read the article: 5 Questions for Better Cost Management Discussions
We look forward to your engagement, comments , and sharing.