Purposes and methods of research and development cost management at the aircraft engine-building enterprises

Economics


Аuthors

Mikhailova E. A.1*, Krylov S. V.2**

1. Rybinsk State Aviation Technical University named after P.A. Soloviev, RSATU, 53, Pushkin St., Rybinsk, Yaroslavl region, 152934, Russia
2. United Engine Corporation “Saturn”, 163, Lenin av., Rybinsk, Yaroslavl region, 152903, Russia

*e-mail: economy@rsatu.ru
**e-mail: krylovsv37@gmail.com

Abstract

The article considers the main requirements to a research and development cost management system at the aircraft engine-building companies. These requirements are claimed both in terms of research and development features as an activity category, and relative to the aircraft-engine-building branch peculiarities stipulated by specifics of life cycle of gas-turbine engines. We determined the main limitations imposed on the research and development cost management system with a view to the necessity to carry out the existing norms of active legislation, implemented to ensure State defense order. Based on an information available in free access the paper gives the examples of practical suppositions of the necessity of research and development cost management at aircraft engine-building enterprise JSC NPO Saturn.

The paper considers the classification of cost management methods according to organizational and administrative level of applied approaches. Based on the considered requirements and limitations we suggest recommendations on development, organization and selection of trends of development of research and development cost management system at an aircraft engine-building company.

The research and development cost management system should provide sustained management in conditions of:

  • uncertainty and risk;

  • existence of a set of diverse projects.

Cost research and development management at the aircraft-engine-building companies should be carried out by the integrated subsystem of business management providing rational distribution of resources between existing projects according to the purposes of the organization, and representing generally system of norms and the rules supported by mechanism of their execution.

One of the variants of classification of cost management methods is the group of cost management methods depending on organizational and administrative level on which administering is exercised. By following this classification, it is possible to split cost management methods into three main groups: operational methods, managerial methods and strategic methods. Examples of popular cost management methods are target costing and earned value analysis. These methods are widely used in the sphere of management of research and development and in project management.

It is worth noting that only reasonable application of various methods of cost management at operational, managerial and strategic levels will allow minimize disadvantages of applied approaches, and achieve synergetic effect from a combination of their advantages. Methods of target costing and earned value analysis considered in the present article are widespread methods of cost management at the enterprises and have considerable theoretical and practical base of use. Nevertheless, their full integration into an enterprise management system is still involves considerable difficulties and related to resistance, both from managers, and from the staff.

Increase of efficiency of use of methods of target costing and earned value analysis is obviously possible by organic integration of these methods into the intra- corporate institutes providing comprehensive support of adoption of administrative decisions at all administrative levels.

Keywords:

cost management, research and development, aircraft engine-building

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