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What
is CostMapping™?
CostMapping™
is a P&L performance improvement method that combines the
principles of Activity Based Costing (ABC) with the best practices of
process mapping.
CostMapping™,
created by ICMS, combines pictures, words and numbers to help leaders,
managers and employees define their:
-
"As Is" Process … document
existing process flows and costs
- "Will
Be"
Process … define changes that will be immediately implemented
to improve process flow and costs
- "Can
Be"
Process … brainstorm a breakthrough, reengineered process flow
and costs
What
is CostMapper™?
Managing processes is key to the success of any organization. CostMapper™
is a new software tool that combines easy-to-understand process maps
with spreadsheet-style ABC worksheets to manage and measure any organization's
processes. The following screenshot shows a typical CostMapper™
process map and activity cost worksheet.
How does CostMapper™ differ from
other ABC software?
- CostMapper™
makes process and performance improvement easier to achieve by combining
flowcharts and ABC into one software tool.
- CostMapper™
uses a single cost driver … time … to allocate costs to
activities and cost objects (e.g., orders, products, customers). Most
ABC software products require gathering many different cost drivers.
CostMapper™ uses a simpler approach, called Time-Based ABC. For
a comprehensive explanation of Time-Based ABC, we recommend the following
article in Harvard Business Review: http://hbswk.hbs.edu/item.jhtml?id=4587&t=finance
-
CostMapper™ measures activity and process cost.
- CostMapper™
measures capacity. Idle, excess capacity is the largest non-value
added cost of most organizations.
-
CostMapper™ uses a simple "point & click" method
to create a Bill of Activity. Most ABC software products require the
user to allocate activities to cost objects using different cost drivers
gathered from multiple sources.
Each path through the process… commonly called a Bill of Activity…
can be used to calculate the Activity Based Cost and time consumed by
an order, customer, product, service, project or any cost object.
Uses of CostMapper™?
-
Process improvement
- Customer
profitability analysis
-
Price quoting
-
Service Costing
-
Product Costing
-
Competitive Bidding
-
Reverse Auction costing
-
Reengineering
- Lean
Costing
-
What-if Analysis
-
FTE Analysis
-
Performance Measurement
-
Capacity Analysis
-
Set minimum order policy
-
Much more
CostMapping™
training?
CostMapper™ comes with pre-defined CostMaps™, activity dictionary
and tutorial. ICMS provides two-hours of free software training via
WebEx to everyone that purchases CostMapper™ software.
Onsite
training or implementation consulting is available from ICMS. For a
proposal, e-mail tompryor@icms.net.
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