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Understanding Critical Success Factors in ABM

The document discusses critical success factors (CSF) and their dependence on various elements, emphasizing the importance of monitoring, building for the future, and benchmarking against ideal standards. It highlights three types of benchmarking: internal, competitor, and process, and stresses the need for quantitative performance measurement in models like SWOT. Additionally, it introduces activity-based management (ABM) and costing, which allocates overheads based on cost drivers rather than time, and outlines its strategic and operational levels.

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8 views1 page

Understanding Critical Success Factors in ABM

The document discusses critical success factors (CSF) and their dependence on various elements, emphasizing the importance of monitoring, building for the future, and benchmarking against ideal standards. It highlights three types of benchmarking: internal, competitor, and process, and stresses the need for quantitative performance measurement in models like SWOT. Additionally, it introduces activity-based management (ABM) and costing, which allocates overheads based on cost drivers rather than time, and outlines its strategic and operational levels.

Uploaded by

Sri
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

CHAPTER 1

CSF - critical success factor


 Depends on a lot of factors
 Monitoring - for now
 Building - for future
 Benchmarking - comparing with ideal standards
 Three types -
 Internal - department to department
 Competitor - someone in same industry
 Process - same process in different industry

Important to articulate answer properly - so write and practise, do not think


Exam question - are these benchmarks useful for this company? - yes or not
In APM - all models like SWOT are based on performance measurement and quantitative
measurement, not just “do a SWOT” - if opportunity, how much of an opportunity? (how
much revenue can be made etc.) (good swimmer example)

ABM -
 activity based management based on activity based costing
 cost of the product based on all direct costs and its share of overheads
 Traditionally overheads allocated based on time of each part
 But businesses have changed now, so we need a different approach
 So ABC absorbs based on cost drivers -
 Take overheads and break up based on activity - but absorb based on cost driver
 ABM at two levels - strategic and operational ABM

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