Strategic cost management: an activity‐based management approach

Abstract

The design and implementation of new strategic management initiatives, such as reengineering, have been common since the publication of Hammer and Champy’s (1993) popular book on reengineering. In the process of designing and implementing these new initiatives, however, managers have virtually ignored the cost management system. Activity‐based management (ABM) is a system that incorporates many of the concepts of strategic management reengineering and applies them to cost management. ABM consists of two viewpoints: a cost view and a process view. ABM is both an accurate cost accounting system (the cost view) and a performance evaluation tool (the process view). This paper presents the ten steps to design and implement an ABM system and offers an actual application.

Citation

Trussel, J.M. and Bitner, L.N. (1998), "Strategic cost management: an activity‐based management approach", Management Decision, Vol. 36 No. 7, pp. 441-447. https://doi.org/10.1108/00251749810227093