Capability Costing is undertaken using the concepts of Activity Based Costing (ABC). ABC provides a unique management tool for enhancing the quality of decision-making. Activities are linked to the resources consumed, which ultimately incur costs; enabling management to more effectively manage and control costs.
The ABC consulting assignment approach follows a structured approach with the implementation strategy incorporating the following process:
Education and Training
Selecting the ABC team
Defining the Capabilities
Defining the Customers
Agreement on the Cost Base
Linking Cost Base to Activities/Cost Pools to Capabilities to Customers
Defining the Drivers
Collecting data
Building the model
Verifying the model and scenario testing
This unique process provides the link between business planning, identification and costing of capability with the performance of the organisation. The process identifies the key business processes within the organisation and the actions required to move the organization forward.
The consulting assignments that have been undertaken have been successful due to the unique methodologies that have been employed. The success achieved is due to an appreciation of the assignment in terms of:
Keeping it simple
Making it meaningful and practical
Developing a structured approach
Keeping it cost effective
We have developed a leading edge in the delivery of many high profile assignments. The process of transferring ownership to the client through "facilitation consultancy" has proved to be both cost effective and efficient.
Capability Costing can include:
Identification of Capabilities
Development of performance measures
Activity Based Costing - a complete solution
Accrual Output Budgeting
Designing & negotiating performance contracts
Design of effective diagnostic and monitoring systems
