Topic: BUSINESS PERFORMANCE: THE ROLE OF COST MANAGEMENT

Chapter One

INTRODUCTION

1.1 Background of the Study

With the dynamic and sophistication in the management of business in contemporary Nigeria, one would think these challenges will be greatly met in part through the instrumentally of cost management. However, the above lastly wish being put to practice by some organization and even when it has been established. No conscious effort is made to mobilize the necessary resources and create a conducive environment to make the system work. Any business form in whatever form and size have an objective to accomplish every section or goals to pursue which one tailored towards achieving the overall objective of the organization. In other to achieve the goal set by the management. There is the need to established a form plan of action which will provide the organization with a sense of directory and to work towards the realization of the set target. An important management tool that provides the sense of direction and formalized the pans of the organization is cost. If the organization has no sense of direction it is not far from grouping in the dark. Success in any business organization has to be worked for by the management paying attention to all phases of operations. The relevance of government in any business organization is being provided with quantitative management expression of plans through cost control. The planned activities of the organization are controlled by contemporary actual performance with the cost. This is achieved through the framework of performance passed by increased modern business. There is a constant used form management to be more conscious and cost conscious in their business. Whatever the level of uncertainty a business entity may face, there is need for planning form obvious. The benefit will outweigh the cost. Many company haste derived by engaging techniques of cost management tools create for the confidence of creditors institution so that credit would be extended to them without consciously putting in place it work. This is made a scope-goal of the system of which the ills of the light of the above that this study is uncertain and aimed at establishing the importance of cost management in order to raise the level of profit planning. Also the fact that the more emphasis needed to make the more the level of awareness and in addition, the business community needed to be more cost conscious in order to meet the difficulties posed by the challenging government regulations. Customers need economic situation and technological advancement. This project therefore attempt to look at the prospect by cost management.

1.2 Statement of Problem

Cost management in the organization is the fundamental instrument for monitoring the flow of resources within business organization. It requires review of hanger practitioners in modern day business arrangement. Perhaps, no time is more important than to stress the sense of cost management. In daily affairs of the business, for one thing almost all large public sector concerned in Nigeria today are experiencing ongoing privatization scheme with the ownership structure moving to investors. The performance of stock divided pay out become very important issue which all boiled down to the profitability of the business. Furthermore, in the past years, the discomforting trends discernible from customers and practitioners in the beverage industry is a process where increases are in cost continue to out pose generated revenue. The simply translates into mounting heavy marking lying variable personnel. Going by the trends, it is obvious that business organization can no longer afford to post pone consideration effective cost till the need arises business managing in the 1990s and beyond has assures a highly vocative dimension thus the ability of a firm to budget control financial resources will separate the owners from the losers in preventing economic structure reform in Nigeria. A cost therefore should be seen as the amalgamation of various function areas in business firms. The contention of the project therefore is that cost management should be constructed with appropriated techniques is an essential profitability in an organization.

1.3 Aim and Objectives of the Study

The major objective of this research work is to try provide significant ways in which the amount of business failure can be reduce and also to provided foresight in business activities. This project is aimed at bringing to the render the relevance and prospect offered by cost management irrespective of the level of uncertainties surrounding the business in order to create more conscious awareness of the fact that management toil will not work unless a conducive environment has to be created for the management.

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