Barriers to successful implementation of ABC for continuous improvement: A case study

Abstract Continuous improvement is the process of gradually working toward the achievement and sustainment of competitive advantage. Activity based costing has been suggested as an appropriate tool for guiding and directing the process of improvement through the use of activity based management. Several case studies have been described demonstrating the use of ABC and ABM in this process of continuous improvement. Not much has been said, however, about unsuccessful implementations of ABC and ABM. We believe we can learn a lot by analyzing cases in which the use of ABC failed or turned out to be ineffective. Therefore, we present this case study: it is a description of a company in which the ABC information could not be used in a way to yield continuous improvement. It is the objective of this paper to analyze the barriers to a succesful implementation of ABC for continuous improvement in this company