Purpose -The purpose of this paper is to describe the experiences of a wholesaler with time-driven activity-based costing (TDABC). Three research questions are addressed: How are complex logistics operations modeled by TDABC? Does TDABC provide more accurate cost information than activity-based costing (ABC)? How is TDABC cost information used? Design/methodology/approach -Case study research was performed at a Belgian wholesaler. Interviews were conducted. The cost and activity database was analyzed.Findings -This case study illustrates that there are logistics operations that cannot be modeled using a single cost driver, as is done with ABC. TDABC uses time equations to estimate the time spent on each activity. The results herein show how the time equations can capture the different complexities, by including different terms or interaction terms in the time equations. The database analysis clearly demonstrates that TDABC provided more accurate cost information than ABC at this case company. ABC oversimplified 64 percent of the activities, and misallocated 55 percent of all indirect costs. Research limitations/implications -This study is one of the first, investigating the experiences with TDABC. The results are derived from analyzing all activities, at a single case company. Practical implications -The study illustrates the technique of TDABC and provides a real company example of time equations in logistics. The users declared the TDABC model very useful for profitability reporting and profit management. The time drivers provided insight into the causes of excessive distribution and logistics costs. Originality/value -This paper complements current discussion on cost drivers and subtasks and logistics costing.
PurposeThis paper sets out to develop and illustrate a model of the relationship between strategic alignment, motivation and organizational performance in a balanced scorecard (BSC) context – a comprehensive system of strategically aligned performance measures.Design/methodology/approachThe study develops theoretical arguments to show how the strategic alignment process of a BSC can help companies improve their organizational performance. The study develops a theory of the motivational mechanisms that intervene in the relationship between strategic alignment and organizational performance. The literature on operations management and management control are used to underpin the theoretical propositions. A theory illustration case study is described to provide evidence for the theoretical model.FindingsEffective strategic alignment calls for the active involvement of manufacturing executives in the BSC design and implementation process. Effective strategic alignment empowers and motivates manufacturing executives. A combination of effective strategic alignment and a BSC‐based compensation plan has a positive effect on the extrinsic motivation of manufacturing executives.Research limitations/implicationsThe case study offers an interesting setting to illustrate the theoretical predictions. However, it is not possible to generalize the results to the population of manufacturing companies. Future research could formally test the relationship between strategic alignment, motivation and organizational performance by using a survey questionnaire in companies that use BSCs.Originality/valueThis paper studies the cascading process, a systematic approach to the creation of strategic alignment using the BSC.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.