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Article
Publication date: 10 August 2015

Ahmed E. Haroun

The purpose of this paper is to present the use of activity-based costing (ABC) approach as an alternative option to the traditional cost accounting system. The contribution of…

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Abstract

Purpose

The purpose of this paper is to present the use of activity-based costing (ABC) approach as an alternative option to the traditional cost accounting system. The contribution of this study is to demonstrate, through a simple example, the application of that costing system in a service (maintenance) industry, i.e. the paper intended to develop a procedure for a cost model that help in calculating any maintenance job cost, to a reasonable degree of accuracy, based on the actual activities performed.

Design/methodology/approach

This research uses a simple example whereby hypothetical activities and cost data of maintaining an injector and a pump, of an internal combustion engine, are used, presented and analyzed based on the use of the developed procedure.

Findings

ABC system provides more accurate cost estimates rather than the traditional “order costing” methods that uses unit-level costs which are variable in relation to change in service volume. Traditional cost methods distort the costs by applying overhead uniformly over different jobs of varied complexities and activities scope. On the other hand, ABC is a useful means to distribute the overhead costs in proportion (fairly) to the actual activities performed in a specific job and, hence, enhance the rationality of decision making, i.e. will not distort the accounting information used for cost reduction, pricing, and evaluation matters. The results obtained from the analysis showed that allocating costs to the maintained injector decreased from $83.55 to $71.95 and, finally, to $67.57 when using the workshop-wide, two-stage and ABC overhead allocation methods, respectively; while that of the pump increased from $298.90 to $340.34 and, finally, to $359.48 when using the same three methods, in the same order, respectively. The result is quite fair when considering the complexity of the fuel pump, in terms of design and maintenance, when compared with the injector. Notice that using volume to allocate overhead costs results in over costing high-volume products, e.g. injectors (simple in terms of design and operation) and under costing low-volume products, e.g. pumps (more complex in terms of design and operation). The paper recommends to use ABC as a more accurate and fair method when charging maintenance job orders based on the analysis of costing two maintained items in the same premise while consuming different overhead resources.

Practical implications

This study attempts to analyze different methods to calculate a specific corrective maintenance job order. It strives to remedy the drawbacks of the traditional overhead costing of a job order when using principles related to the size of service, such as the direct labor cost/hours, as an allocation base. Consequently, the study proposed a new costing method, i.e. application of ABC. The traditional costing approach is considered by many firms as the best costing method. Nevertheless, it allocates overhead cost over job performed uniformly (equally) not differentiating between the complexity of the job and variety of the activities performed, e.g. using the same allocation base for “oil change” and “fuel pump adjustment” activities. So, ABC prevents cost distortions (unfairness) that could not be prevented by traditional cost accounting system. The author believes that the method presented in this paper will provide a useful management tool for costing maintenance jobs based on the appropriate selected activity drivers in maintenance workshops. The method could be applied for costing maintenance activities in maintenance of all industrial sectors.

Originality/value

The use of traditional costing method has proven to be distorted by applying overhead uniformly over different jobs of varied complexities and activities scope. In this paper the authors strive to present an effective costing alternative that outperforms the traditional ones with regard to overhead allocation. The paper aims to find reliable and fair maintenance costing method, i.e. to find out the relationships between maintenance activities and cost drivers. Although, ABC is widely used in manufacturing industry, no application or current research has presented an applicable thorough worked-out example, with the exception, to the author’s knowledge, of one in the aeronautical industry, to implement ABC method in maintenance industry. The importance of using this method comes from the fact that it provides, relatively, accurate and fair maintenance bills that provide customer satisfaction and firm good image. Hence, the paper is relevant in this respect and intended to contribute to the practice of maintenance management.

Details

Journal of Quality in Maintenance Engineering, vol. 21 no. 3
Type: Research Article
ISSN: 1355-2511

Keywords

Article
Publication date: 1 June 1988

A.M. Whiteley

The Problem in Cleveland In May 1985 it came to the attention of the Cleveland Area Manpower Board, via the Careers Service, that 40 per cent or more of those youngsters who had…

Abstract

The Problem in Cleveland In May 1985 it came to the attention of the Cleveland Area Manpower Board, via the Careers Service, that 40 per cent or more of those youngsters who had previously had difficulty in coping in their school environment were failing to succeed in YTS. A review of the literature of “both sides” — government/MSC proponents versus their critics in education and industry — revealed that there was cause for concern regarding the sector of youth referred to as low achievers. Some aspects of the problem, if indeed one did exist, were self‐evident. At some time during the school career the low achiever's ability to conceptualise within the school framework of cultural values and academic subjects either did not develop, or ceased to develop at some point, or was not yet sufficiently developed to keep up with class norms. This meant that, relatively speaking, while the rest of the class built layer after layer of verbal and numerate expertise it went on outside the scope of the low achiever's comprehension.

Details

Education + Training, vol. 30 no. 6
Type: Research Article
ISSN: 0040-0912

Article
Publication date: 21 November 2008

Bob Glass

The purpose of this paper is to provide a flavour of the content of the LILAC conference held in Liverpool, UK in March 2008.

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Abstract

Purpose

The purpose of this paper is to provide a flavour of the content of the LILAC conference held in Liverpool, UK in March 2008.

Design/methodology/approach

An outline of the issues, content, keynote speakers and delegates is provided.

Findings

This conference covered the themes of supporting researchers, diversity and social justice, practical approaches to information literacy, the Net generation, ethical information, staff development and information literacy and marketing information literacy.

Originality/value

A conference report of value to library and information professionals regarding various information literacy themes, with a link to web site information.

Details

New Library World, vol. 109 no. 11/12
Type: Research Article
ISSN: 0307-4803

Keywords

Article
Publication date: 1 January 1985

Bob Crew

The impact of video‐based distance learning technology will give women who are currently prevented from studying by time, money or geographical considerations, the chance to…

Abstract

The impact of video‐based distance learning technology will give women who are currently prevented from studying by time, money or geographical considerations, the chance to undergo further training and progress up the management ladder, an opportunity to reverse the trend that allows management still to be seen as a masculine role. Henley Management College (in conjunction with Brunei University) offers a two‐ to four‐year distance learning MSc, in addition to its full‐time courses, having the aim of training women managers and getting them into positions of seniority. (Article includes a listing of opportunities for women in management education).

Details

Industrial Management & Data Systems, vol. 85 no. 1/2
Type: Research Article
ISSN: 0263-5577

Keywords

Book part
Publication date: 7 December 2006

Christina H. Drew, Michael Kern, Todd Martin, Max S. Power and Elaine M. Faustman

Openness is critical to long-term cleanup and stewardship of former nuclear weapons manufacturing facilities. Openness is especially challenging in such facilities because a…

Abstract

Openness is critical to long-term cleanup and stewardship of former nuclear weapons manufacturing facilities. Openness is especially challenging in such facilities because a culture of secrecy has dominated them since the earliest days of nuclear weapons development. This paper describes a multi-year effort at the Hanford Site called the Hanford Openness Workshops. The Workshops were convened to address and resolve issues impeding the availability and understanding of information important to public health, the environment, and decision–making. Lessons from the workshops can improve dialogue about nuclear waste cleanup and long-term stewardship among regulators, decision makers, stakeholders, and Tribes.

Details

Long-Term Management of Contaminated Sites
Type: Book
ISBN: 978-1-84950-419-5

Book part
Publication date: 19 June 2020

Tashmin Khamis and Anil Khamis

In the present era of the sustainable development goals (United Nations, 2015), what is the trajectory of education and social development in Kenya and other sub-Saharan African…

Abstract

In the present era of the sustainable development goals (United Nations, 2015), what is the trajectory of education and social development in Kenya and other sub-Saharan African countries? What forces are impinging on decision-making and how are these forces in turn supporting systemic development that relies on national policy-making and implementation frameworks? What is the role and purpose of higher education institutions, particularly to underwrite quality and relevance? Finally, what are the intended outcomes, and what benefits accrue to the citizenry?

These complex and contested questions require conceptual, theoretical, and methodological tools to address. This chapter outlines the initiative and mandate of the Aga Khan University (AKU) that has led on quality assurance and enhancement linked to faculty educational development to promote excellence in teaching in higher education institutions in East Africa. AKU is presented as a qualitative case study, building on a descriptive analysis of published work, to elucidate issues and opportunities that must be addressed by higher education institutions with regard to the SDGs from the lens of quality.

Assessing the initiatives of AKU raises critical questions of the role of education, particularly higher education institutions, to support development that in turn address and advance the diverse needs of global populations. Arguably, this is the transformative function of the SDGs.

Article
Publication date: 1 October 2003

Stefan A. Seuring

Strategic outsourcing and supply chain integration issues have gained considerable attention in recent years. Concentration on core competencies usually addresses examples along…

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Abstract

Strategic outsourcing and supply chain integration issues have gained considerable attention in recent years. Concentration on core competencies usually addresses examples along one supply chain. However, a different phenomenon appears in the strategic “dis‐integration” of companies. As explored in five cases taken from the German chemical industry, a separation of two kinds of companies can be observed. Product manufacturers concentrate their business on specific products and technologies, while facility operators, which can also be conceived as service factories, are formed to operate the infrastructure of a production site. This will be described and analysed on building outsourcing and service management thought. A model will be derived describing how the formation of facility operators takes place. The services offered are analysed to yield insights into the business of facility operators. The link between product manufacturers and facility operators offers challenges for future research in supply chain management.

Details

International Journal of Operations & Production Management, vol. 23 no. 10
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 15 March 2013

Nicolas Ceasar and Nadine Page

The purpose of this paper is to describe a management development intervention, facilitated by two consultants, to support the leaders of a multinational organisation to make…

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Abstract

Purpose

The purpose of this paper is to describe a management development intervention, facilitated by two consultants, to support the leaders of a multinational organisation to make sense of sustainability through experiential dialogue and engagement. Participants from different communities and organisations convened to develop an open and challenging framework for discussion.

Design/methodology/approach

The two‐day, off‐site intervention focused on what it means to create sustainability for the business in the long term, with a particular emphasis on the responsibilities faced by the leaders and the organisation’s value chain. The workshop was designed around the principles of sensitizing, re‐visioning and transforming.

Findings

The intervention supported participants to discuss and engage with sustainability and allowed them to increase their understanding and vision, at both a personal and organisational level. Success factors included developing a solid contract between the consultant and client, the role of trust, sufficient time, open but goal‐directed facilitation skills, location congruence and being away from usual routines.

Originality/value

Management development interventions for sustainability need to take leaders away from their usual settings and relocate to a different place where they can challenge their current cognitions, values and beliefs. Human resource/Learning and development specialists need to continue to support their managers to make sense of the complex yet critical issues of sustainability.

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