preview

Activity-Based Total Quality Management at American Express

Better Essays
Open Document

Cost
Management

Journal of

A WARREN GORHAM LAMONT PUBLICATION

Vol. 7, No. 1 Spring 1993

Target Costing at Toyota
Activity-Based Costing in Cellular Manufacturing Systems
Controlling Quality on a Multidimensional Level
The Effect of JIT on Management Accounting
Activity-Based Total Quality Management at American
Express
From the Editors / Barry J. Brinker
Cost Management Practice / Steven C. Schnoebelen
The Factory in Transition / Arun Maira

Reprinted with permission from The Journal of Cost Management, Volume 7, Number: 1 c1993
Research Institute of America, Inc., Warren Gorham Lamont Professional Publishing Division,
210 South St., Boston, MA 02111. All rights reserved.

Activity-Based Total Quality …show more content…

IPS appears to have made important progress, however.
Activity-based TQM
The TQM initiative at IPS began by getting all employees involved in continuous improvement efforts. Customer satisfaction, vendor satisfaction, and employee satisfaction were processes that were assessed regularly, and efforts were made to gain a better understanding of the activities and performance measures at IPS.
Activity analysis began in the customer service department and telephone operations and quickly became interwoven with concerns about product costing. In particular, senior management wanted to manage growth better by gaining a better understanding of fixed versus variable costs for each product line.
Product costing was connected with the quality strategy because both efforts tried to answer the

Spring 1993 -- 49

COST MANAGEMENT

difficult questions of how and where information workers spent their time.
ABC is central to recent efforts to redesign cost accounting systems to account for a wide variety of changes that have occurred in high-technology manufacturing and service firms. These changes require accountants and all other employees to alter their mindsets away from cost accounting toward “cost management.”
Cost management emphasizes an active approach to planning and managing an

Get Access
Related
Get Access