Managing Information in Toyota Motor Corporation Research Paper

Managing Information in Toyota Motor Corporation - Research Paper Example The objective here is to achieve optimum cost control so that it will reflect positively on the bottom - the line of the company’s profits and give maximum returns to the stakeholders of the company. Efforts at cost control, without compromising on quality, are an everyday effort within the company Cost control can be defined as â€Å"Application of (1) investigative procedures to detect variance of actual costs from budgeted costs, (2) diagnostic procedures to ascertain the cause(s) of variance, and (3) corrective procedures to effect realignment between actual and budgeted costs.† The type of information that is required to achieve cost control is wide-ranging and has to be acquired from a variety of sources. The types of cost that are incurred in a typical manufacturing concern include direct costs, indirect costs, hidden costs, future liability costs, intangible costs, external costs etc.a. Direct costs: Direct cost is costs that can be readily identified as those d irectly incurred in them the manufacturing process. It includes raw materials, wages depreciation etc.  b. Indirect costs: Costs, which cannot be attributed directly to production, are termed as indirect costs. These include salaries, rent, marketing expenses etc.  c.   An example would be where customers are not satisfied with the product which results in a fall in sales. â€Å"Some examples of hidden quality costs are customer dissatisfaction with a product or defects in a product that causes a loss of sales.