A STUDY ON THE ABC APPROACH IN COST MANAGEMENT PRACTICE
Activity-based costing (ABC), an alternative approach to traditional accounting, represents a costing methodology that identifies the main cost drivers, or the main activities in an organization, thus assigning the cost of the products and services according to the number of specific activities or transactions used in the development process of a product or service. This system is based on the measurement of all the activities performed within an organization and provides the companies with the opportunity to efficiently improve their activity or to reduce the costs with no quality loss for their customers. The primary aim of ABC method was to implement a logical system of additional allocation with a better information and improvement in the field of managerial policies, a real cost structure on the basis of which strategic managerial decisions could be further adopted. Under the terms of a continuous growth of fixed cost weighting, we will become more interested in the calculation system of process costing. This costs calculation method can bring on important benefits, especially for service provider companies, considering the high share of common- indirect costs (overhead), in their unit.
An Integrated Dashboard and Balanced Scorecard Solution
Access to information has always been a stringent necessity for any organization. This necessity has become more stringent in the actual economic context, as decisions must be taken in the shortest time. That is why since, the early sixties, the Decision Support Systems appeared. These have evolved together with the client-server technology, during the eighties, towards the today’s Executive Support Systems. Nowadays, these systems tend to be replaced by Dashboards and Balanced Scorecards (BSC), which fulfill the more and more sophisticated and growing information needs of the decision factors. In this article, we shall present an integrated solution for creating dashboards and scorecards using an enterprise portal. In the same time, we will analyze the advantages and disadvantages of a such integrated solution vs. independent solution.
Economical Aspects when Deploying Enterprise Portals
Enterprise portals have become the backbone for the integration of a large number of different applications, content, and services (Smith, 2004). Nowadays, electronic business can hardly be imagined without the use of these portals as central entry points. At the same time, companies become more and more aware that portal projects are complex, timeand cost-consuming, with a high risk of failing. Costs and benefits to build up and operate an enterprise portal have to be weighed up in a systematic manner, including makeor-buy decisions with regard to packaged portal platforms vs. open source developments, individually developed vs. purchased standard portal components (Hazra, 2002). However, often clear figures describing the economic impact of portal solutions are missing. Furthermore, there is still uncertainty which methods are suitable, at which stage of the implementation process they have to be used, how they have to be adapted and customized, and which preconditions have to be set in order to assess the economic impact of enterprise portals. In addition, enterprise portals can be deployed across a broad range of industries and application areas, thus enabling the implementation of such different portals like knowledge portals, employee portals, ERP portals, collaborative portals, process portals, and partner portals. All these types of portals need a specific and individual approach to evaluate the economic impact. The goal of this article is to contribute to the decision of how to analyse and evaluate the economic impact when deploying large enterprise portals. For that purpose, we present a framework that can be applied by carrying out the following steps: At first, important preconditions and assumptions concerning the portal solution have to be collected. Then, key factors, derived from the results of the previous step, can be identified. Finally, these factors have to be evaluated and, if possible, quantified and measured. Consequently, these steps have to be embedded in the development process of the portal solution. We describe a procedure model, based on the stages of the PDCA-approach (plan, do, check, act), which can be used to carry out a structured analysis taking into account the whole life cycle of the deployed portal solution. As foundation of the framework, we provide a classification, where measurable key factors of portal costs, benefits, and risks are collected and structured (according to the main portal types B2E, B2B, and B2C). In particular, qualitative factors play an important role in portal projects. Even though these factors are hard to measure, they are urgently needed to draw a complete picture of the profitability of a portal project. Based on this classification, existing methods to measure the economic impact are reviewed and assigned to the corresponding items of the classification.