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Activity-Based Management - An Overview (Technical …

Activity-Based Management and Activity-Based costing (ABM/ABC)have brought about radical change in cost Management has grown largely out of the work of the Texas-basedConsortium for Advanced Manufacturing-International (CAM-I). Nolonger is ABM s applicability limited to manufacturing principles and philosophies of Activity-Based thinking applyequally to service companies, government agencies and processindustries. The acronym itself has evolved from ABC to ABCM (activ-ity- based cost Management ) to ABM, and the application of ABCevolved from a manufacturing product costing orientation to a man-agement philosophy of activity Management applied in industries andorganisations other than manufacturing.

Activity-based costing/activity-based management fills this information need by providing cost and operating information that mirrors the horizontal view. The focus of ABC is on accurate information about the true cost of products, services, processes, activities, distribution channels, customer segments, contracts, and projects.

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