Supply Chain Cost Control Using Activity-Based Management

Having an accurate assessment of company expenditures is a key to staying in business. Activity-based management (ABM) is the only system that offers the tools to correctly assess the outflow involved in a tightly knit supply chain and enables understanding not only of the total cost of ownership (TCO), but also how these costs should be allocated. Supply Chain Cost Control Using Activity-Based Management discusses the competitive advantage that cost analysis and management can bring to companies within a supply chain.

Addressing a number of strategies to evaluate the total cost inherent in a customer-supplier relationship, this book uses TCO, activity-based costing (ABC), and ABM to analyze and control supply chain costs. It employs industry survey data to examine whether these techniques are being used in real life, which factors affect their usage in the supply chain, and whether they are producing results. Combining survey results with game theory, the authors suggest cost reduction strategies for competitive environments and predict the outcomes of these strategies. This cost-effective system helps businesses remain competitive and profitable.

Supply Chain Cost Control Using Activity-Based Management shows the importance of partnerships in applying ABM principles to suppliers and demonstrates the positive results that ABM can have on elements of the TCO.

About the Authors

Sameer Kumar is a professor and Qwest Endowed Chair in global communications and technology management in the College of Business at the University of St. Thomas, Minneapolis, Minnesota. Prior to this position he was a professor of engineering and technology management at the University of St. Thomas. Before joining St. Thomas, Dr. Kumar was a professor of industrial engineering in the Department of Industrial Management, University of Wisconsin—Stout. His major research areas include optimization concepts applied to design and operational management of production and service systems.

He has been actively involved in a wide variety of challenging industry projects for more than 25 years in the United States and India. He has published and presented articles in various research journals and conferences. He is a registered professional engineer, certified manufacturing technologist, certified manufacturing engineer, and certified plant engineer, and has earned master's degrees in mathematics (University of Delhi), computer science (University of Nebraska), and industrial engineering and operations research (University of Minnesota). He received his Ph.D. in industrial engineering from the University of Minnesota.

Matthew Zander is a procurement quality engineer at IBM where he supports its engineering and technology services (E&TS) group in Rochester, Minnesota. He graduated from Michigan Technological University in Houghton with bachelor of science degrees in mechanical engineering and scientific and technical communications and from the University of St. Thomas in St. Paul, Minnesota, with a master's degree in manufacturing systems engineering. He has previously worked in procurement cost engineering and server software system documentation at IBM and held quality system internship positions at Super Steel Products Corporation in Milwaukee, Wisconsin, and General Motors Corporation Technical Center in Warren, Michigan.