Activity -Based Management for Systems Consulting Industry

How a consulting organization identified an Activity-Based Management system for a service company is described. An Activity-Based Information System needs to be put in place to serve as data-driven decision support for planning, pricing, budgeting, and cost management. Activities and activity centers need to be identified with their associated cost drivers as the components of an Activity-Based Information System. Quality, risk management and customer retention issues should be addressed by building specific cost and revenue drivers that develop into strategic choices. The Activity-Based Costing system for project control enabled the firm to focus on activities where costs were incurred. The same approach of measuring, monitoring, and managing the projects could form the basis for helping the management process at all levels.