business or in other words, to improve the business performance measurement indicators mentioned above, it is necessary to (Hiến, 2020) Principle 1 Align cost management with the goal of profit growth.
business or in other words, to improve the business performance measurement indicators mentioned above, it is necessary to:[CITATION Hiế21 \l 1033 ] Principle 1: Align cost management with the goal of profit growth and sales Most companies today not see the importance of integrating cost management with business strategy as well as the foundation for sustainable growth of the business Companies and businesses can only achieve profits at a high growth rate when there are two factors closely linked: cutting costs and increasing sales If the business has too high expenses, it will have to limit the investments for the business growth plan Competitors with a more cost-effective approach can achieve similar or even higher levels of profit while still having enough money to invest in other activities such as sales promotion, marketing and innovation new But if you focus too much on cutting costs without investing in long-term growth, it will lead to business stagnation, eroding the business position of the business Principle 2: Adjust cost-cutting goals to suit actual spending and revenue and specific business strategies The company needs to set an attractive profit growth target to encourage managers to agree on different cost reductions to achieve the set goal However, it is also necessary to determine the % of profit earned from cost reduction and % obtained from other business improvement and development efforts There are three other factors to consider when setting cost-cutting goals at any company These factors should be in balance, and none should take precedence over: How cost reductions compare to costs for other businesses in the company? How cost reductions compare with competitors' similar costs? What level of costs are needed to support the intended growth goals and ensure that the business is not impacted? Principle 3: Distinguish between good costs and bad costs The art of managing costs well or not is all about the goal of cost reduction and growth The problem for managers is how to cut down in the most reasonable way without losing essential capacity or reducing the competitiveness of the