Techniques of interorganizational cost management: A review essay

Cost management involves initiating and making decisions which will improve the cost effectiveness of an organization. This paper reviews the interorganizational cost management practices. In a dyadic relationship, two collaborating firms emphasize on intensive and long-term relationships. In a network relationship, the coordinating principles facilitate cooperation among members in the network. A dynamic learning capability that creates competitive advantage needs to be extended beyond firm boundaries. A number of interorganizational cost management techniques such as target costing, open book accounting, value chain analysis, information sharing etc. are greatly focused in different studies. Reviewed papers within the literature have a mixture of theoretical models, such as transaction cost economics, resource-based view, agency theory, actor network theory, contingency theory, industrial network approach, and structuration theory.