Activity-Based Budgeting (ABB) is a powerful, modern approach to financial planning that provides a clear and accurate view of an organization's costs. By shifting the focus from general departmental expenses to the specific activities that consume resources, ABB allows companies to allocate funds more strategically and efficiently. This method is crucial for organizations seeking to optimize spending, improve profitability, and make data-driven decisions. This course will teach you how to implement a system that precisely links costs to the activities that create them, ensuring every financial decision is justified and value-driven.

This comprehensive program is designed to move beyond traditional budgeting methods to give you a hands-on guide to implementing ABB and a more sophisticated approach to cost allocation. You will learn to identify key activities, determine their cost drivers, and build a robust budgeting framework that aligns with your company's strategic goals. By the end of this course, you will possess the skills to transform your financial processes, eliminate wasteful spending, and provide leadership with the detailed financial insights needed to thrive in a competitive market.

Duration

5 days

Target Audience

• Chief Financial Officers (CFOs)
• Finance and accounting managers
• Cost accountants and analysts
• Operational and production managers
• Budgeting and forecasting professionals
• Strategic planners
• Management consultants
• Business unit leaders
• Supply chain managers
• Performance management specialists

Objectives

• Understand the core concepts and principles of Activity-Based Budgeting.
• Differentiate ABB from traditional budgeting methodologies.
• Identify and document key business activities and their cost drivers.
• Accurately allocate indirect costs to products, services, or customers.
• Develop a step-by-step plan for implementing ABB in an organization.
• Utilize ABB data to make informed strategic pricing decisions.
• Measure and report on the profitability of products and services.
• Overcome common challenges and resistance to ABB implementation.
• Integrate ABB with other strategic management tools for enhanced control.

Course Modules

Module 1: Foundations of Activity-Based Budgeting

• Introduction to ABB concepts and benefits.
• The differences between traditional and activity-based costing.
• Key terminology: activities, cost drivers, and cost objects.
• Why ABB is a superior tool for modern organizations.
• The critical role of cross-functional teams in ABB implementation.

Module 2: Identifying Activities and Cost Drivers

• Techniques for mapping business processes and activities.
• How to define and categorize activities.
• Practical methods for identifying activity cost drivers.
• Analyzing the relationship between activities and resources.
• Building a comprehensive activity dictionary for your company.

Module 3: The Cost Allocation Process

• The steps of the ABB cost allocation model.
• Assigning resource costs to activities.
• Allocating activity costs to cost objects.
• Calculating the cost of products, services, and customers.
• The impact of cost allocation on profitability analysis.

Module 4: Implementing ABB in the Real World

• Planning and executing an ABB project.
• Securing buy-in from senior management and key stakeholders.
• Best practices for data collection and validation.
• Developing a pilot project to test the ABB model.
• Transitioning from pilot to full-scale implementation.

Module 5: Leveraging Technology and Tools

• Using spreadsheets and templates for basic ABB.
• Overview of specialized ABB software solutions.
• Integrating ABB with your enterprise resource planning (ERP) system.
• Automating data collection and analysis.
• Reporting and dashboarding for ABB insights.

Module 6: Using ABB for Strategic Management

• How ABB informs strategic pricing decisions.
• Identifying unprofitable products and services.
• Making decisions about product mix and customer focus.
• Cost reduction and process improvement using ABB data.
• Linking ABB to performance management and balanced scorecards.

Module 7: Advanced Concepts and Case Studies

• Advanced allocation methods for complex scenarios.
• The challenges of implementing ABB in different industries.
• Real-world case studies of successful implementations.
• Sustaining the benefits of an ABB system over time.
• Workshop: Building an ABB model for a hypothetical business.

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 7 working days before commencement of the training.