Activity-based costing – connecting and providing strategic information

Abstract

Faced with a rapidly changing business environment, companies are focusing on efficient resource use to support sustainable growth. Effective cost management - rooted in optimal resource allocation and continuous improvement -drives profitability and competitiveness. Prompt collection and analysis of cost and resource data are essential for informed product development. This study examines how activity-based costing (ABC) contributes to these objectives and proposes methods to enhance ABC management. As a result, ABC plays the role of connecting information in the strategic planning, strategic implementation, and providing strategic information to managers. Implementing and researching ABC should be tailored to an organization’s resources and operations to ensure timely and effective resource utilization aligned with sustainability strategies.