Enhancing key success factors in companies through the integration of time-driven product life cycle costing and activity-based management techniques \ Applied study
Abstract
Achieving the basic success factors is a strategic goal sought by industrial organizations in an environment characterized by market fluctuations, increasing competition, and growing customer demands in terms of quality, cost, and time. Based on this context, the research aims to highlight the role of integration between two advanced cost accounting techniques—time-oriented product life cycle costing and activity-based management—in enhancing the basic success factors in industrial organizations by applying them to the Kufa Cement Factory.
The research relied on building an integrated framework that combines a temporal analysis of the product's cost throughout its life cycle, from the design stage to the post-sales stage, and an analysis of the activities that consume actual resources and linking them to actual cost drivers. Actual data from the plant's operational environment was employed, and the primary and secondary activities were identified and linked to time-oriented cost units, with precise mechanisms adopted to measure the cost performance of each activity.
The research results revealed that applying time-driven product life cycle costing (TD-PLCC) provides a high ability to accurately calculate the costs associated with each product stage, especially when combined with activity-based management (ABM), which enables the identification of activities that add value and those that do not, thus rationalizing the use of resources. This has been tangibly reflected in several vital indicators, including reducing overall costs, improving productivity, and reducing wasted time. It also enhances the clarity of information upon which management relies in planning, control, and decision-making processes. It also enhances the industrial organization's ability to achieve key success factors, which include cost, time, quality, innovation, and sustainability.
