Strengths of ABM

Here are some of the advantages of ABM:

• It identifies activities that do not add value. By attaching a monetary value to a process, you are able to assess activities from a monetary perspective. This can tell you if Strategic Alternatives are directed at the right activities.

• It provides insight into cost by unit of measurement (customer, channel, unit of production). Customers and channels do not have the same resource consumption profile. ABM will tell you if the Strategic Alternative is being directed at the right aspects of your business.

• By using ABM, you can get a better understanding of resource consumption and allocation. This technique will show you the true cost of a Strategic Alternative by creating a more comprehensive picture of its cost.