SPC enhances ABC

The limitations of traditional costing systems are well documented in modern cost management literature. In response to these limitations and to address the need for more accurate and timely information, activity-based costing (ABC) has become one of the more widely accepted and used cost management...

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Bibliographic Details
Published in:Industrial Management 2001-11, Vol.43 (6), p.27
Main Authors: Crance, Joseph, Castellano, Joseph, Roehm, Harper A
Format: Magazinearticle
Language:English
Subjects:
Activity based costing
Control charts
Costs
Methods
Process controls
Purchase orders
Statistical process control
Strategic planning
Variance analysis
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Summary:The limitations of traditional costing systems are well documented in modern cost management literature. In response to these limitations and to address the need for more accurate and timely information, activity-based costing (ABC) has become one of the more widely accepted and used cost management tools. ABC, when used in combination with other continuous improvement strategies (often referred to as activity-based management or ABM), improves a firm's decision-making process by focusing attention on the specific activities a firm performs: how they do things, why they do them, and what it costs. When ABC data is used in combination with ABM, the result is a better understanding of a firm's processes.
ISSN:0019-8471