MINGGU 9

Manajemen Biaya
Pokok Bahasan:
Productivity, Marketing Effectiveness, and Strategic
Profitability Analysis

Tujuan Instruksional Khusus:

Mahasiswa mampu memahami tentang Productivity, Marketing
Effectiveness, and Strategic Profitability Analysis

Referensi:
Blocher at all, Cost Management a Strategic Emphasis, International Edition
4th, McGraw Hill, Boston 2006

MANAJEMEN BIAYA Minggu 9 Page 1

COST MANAGEMENT

Don R. Hansen
Maryanne M. Mowen

MANAJEMEN BIAYA Minggu 9 Page 2

Chapter Fourteen

Activity- and Strategic-Based

Responsibility Accounting

MANAJEMEN BIAYA Minggu 9 Page 3

 Learning Objectives

 Compare and contrast functional-based,

activity-based, and strategic-based
responsibility accounting systems.
 Explain process value analysis.
 Describe activity-based financial
performance measurement.

MANAJEMEN BIAYA Minggu 9 Page 4

 Learning Objectives (continued)

 Describe activity-based budgeting.

 Explain the basic features of the Balanced
Scorecard.

MANAJEMEN BIAYA Minggu 9 Page 5

 Responsibility Accounting Model

The responsibility accounting model is defined by

four essential elements:
 assigning responsibility
 establishing performance measures or benchmarks
 evaluating performance
 assigning rewards

MANAJEMEN BIAYA Minggu 9 Page 6

 Types of Responsibility Accounting

Management accounting offers the following three

types of responsibility accounting systems.
 Functional-based
 Activity-based
 Strategic-based

MANAJEMEN BIAYA Minggu 9 Page 7

 Functional-Based Responsibility
Accounting System

A functional-based responsibility accounting system

assigns responsibility to organizational units and
expresses performance measures in financial terms.
It is the responsibility accounting system that was
developed when most firms were operating in relatively
stable environments.

MANAJEMEN BIAYA Minggu 9 Page 8

 Activity-Based Responsibility
Accounting System

An activity-based responsibility accounting system

assigns responsibility to processes and uses both
financial and nonfinancial measures of performance.
It is the responsibility accounting system developed for
those firms operating in continuous improvement
environments.

MANAJEMEN BIAYA Minggu 9 Page 9

 Elements of a Functional-Based
Responsibility Accounting System
Individual Organizational
in Charge Unit
Responsibility
is Defined
Operating Financial
Efficiency Outcomes

Unit Standard
Budgets Performance Measures Costing
are Established
Currently
Static Attainable
Standards Standards
MANAJEMEN BIAYA Minggu 9 Page 10
 Elements of a Functional-Based
Responsibility Accounting System
Financial Controllable
Efficiency Costs
Performance
is Measured
Actual versus Financial
Standard Measures

Promotions Bonuses
Individuals are Rewarded
Based on
Financial Performance
Profit Salary
Sharing Increases
MANAJEMEN BIAYA Minggu 9 Page 11
 Elements of an Activity-Based
Responsibility Accounting System
Team Process

Responsibility
is Defined
Value Financial
Chain

Optimal Dynamic
Performance Measures
are Established

Process- Value-
Oriented Added
MANAJEMEN BIAYA Minggu 9 Page 12
 Elements of an Activity-Based
Responsibility Accounting System
Time Quality
Reductions Improvement
Performance
is Measured
Cost Trend
Reductions Measures

Promotions Bonuses
Individuals are Rewarded
Based on Multidimensional
Performance
Gain- Salary
sharing Increases
MANAJEMEN BIAYA Minggu 9 Page 13
 Strategic-Based Responsibility
Accounting System
A strategic-based responsibility accounting system
(Balanced Scorecard) translates the mission and
strategy of an organization into operational
objectives and measures for four different
perspectives:
The financial perspective
The customer perspective
The process perspective
The infrastructure (learning and growth) perspective

MANAJEMEN BIAYA Minggu 9 Page 14

 Elements of a Strategic-Based
Responsibility Accounting System
Financial Customer

Responsibility
is Defined
Process Infrastructure

Communicate Balanced
Strategy Performance Measures Measures
are Established

Alignment of Link to
Objectives Strategy
MANAJEMEN BIAYA Minggu 9 Page 15
 Elements of a Activity-Based
Responsibility Accounting System
Financial Customer
Measures Measures
Performance
is Measured
Process Infrastructure
Measures Measures

Promotions Bonuses
Individuals are Rewarded
Based on Multidimensional
Performance
Gain- Salary
sharing Increases
MANAJEMEN BIAYA Minggu 9 Page 16
Activity-Based Management (ABM)

Activity-based management (ABM) is a systemwide,

integrated approach that focuses management’s
attention on activities with the objective of
improving customer value and the profit achieved by
providing this value.
Activity-based management encompasses both product
costing and process value analysis.

MANAJEMEN BIAYA Minggu 9 Page 17

Activity-Based Management Model
Cost Dimension

Resources
Process Dimension

Driver Analysis Activities Performance Measures

Why? What? How Well?

Products and
Customers
MANAJEMEN BIAYA Minggu 9 Page 18
 Process Value Analysis

Process value analysis is fundamental to activity-

based responsibility accounting, focuses on
accountability for activities rather than costs, and
emphasizes the maximization of systemwide
performance instead of individual performance.
Process value analysis is concerned with:
Driver analysis
Activity analysis
Performance measurement

MANAJEMEN BIAYA Minggu 9 Page 19

 Activity Analysis

Activity analysis should produce four outcomes:

What activities are performed?
How many people perform the activities?
The time and resources required to perform the activities.
An assessment of the value of the activities to the organization,
including a recommendation to select and keep only those that
add value.

MANAJEMEN BIAYA Minggu 9 Page 20

 Value-Added Activities

A discretionary activity is classified as value-added

provided it simultaneously satisfies three conditions:
The activity produces a change of state.
The change of state was not achievable by preceding
activities.
The activity enables other activities to be performed.

MANAJEMEN BIAYA Minggu 9 Page 21

 Nonvalue-Added Activities

Nonvalue-Added Activities are activities that add cost and impede

performance.

Scheduling
Moving
Waiting
Examples Inspecting
Storing

MANAJEMEN BIAYA Minggu 9 Page 22

 Activity Analysis

Activity Analysis Can Reduce Costs in Four Ways:

Activity elimination
Activity selection
Activity reduction
Activity sharing

MANAJEMEN BIAYA Minggu 9 Page 23

Activity Performance Measurement

Three Dimensions of Activity Performance

 Efficiency
 Quality
 Time

MANAJEMEN BIAYA Minggu 9 Page 24

 Measures of Activity Performance

Financial measures of activity

efficiency include:
Value and nonvalue-added
activity cost reports
Trends in activity cost reports
Kaizen standard setting
Benchmarking

MANAJEMEN BIAYA Minggu 9 Page 25

 Value- and Nonvalue-Added
Cost Reporting

Consider the following data:

Activity Activity Driver SQ AQ SP
Welding Welding hours 10,000 8,000 $40
Rework Rework hours 0 10,000 9
Setups Setup hours 0 6,000 60
Inspection# of inspections 0 4,000 15

MANAJEMEN BIAYA Minggu 9 Page 26

 Value- and Nonvalue-Added
Cost Report (continued)

Value- Nonvalue-
Activity Added Costs Added Costs Actual Costs
Welding $400,000 $ 80,000 $480,000
Rework ---- 90,000 90,000
Setups ---- 360,000 360,000
Inspection ---- 60,000 60,000
Total $400,000 $590,000 $990,000
======== ======== ========

MANAJEMEN BIAYA Minggu 9 Page 27

Trend Report: Nonvalue-Added Costs

Nonvalue-Added Costs
Activity 2000 2001 Change
Welding $ 80,000 $ 50,000 $ 30,000
Rework 360,000 200,000 160,000
Setups 90,000 70,000 20,000
Inspections 60,000 35,000 25,000
Total $590,000 $355,000 $235,000
======== ======== ========

MANAJEMEN BIAYA Minggu 9 Page 28

 The Role of Kaizen Standards

Kaizen costing is concerned with

reducing the costs of existing
products and processes.
Controlling this cost reduction process is
accomplished through the repetitive use
of two major subcycles:
(1) the kaizen or continuous improvement
cycle, and
(2) the maintenance cycle.

MANAJEMEN BIAYA Minggu 9 Page 29

Improving Performance Through
Benchmarking

Organization A Share
Organization B
Cost of Processing a
Information
Cost of Processing a
Purchase Order is Purchase Order is
$20 $15

How do we improve?

MANAJEMEN BIAYA Minggu 9 Page 30

 Activity-Based Budgeting

Activity flexible
budgeting is the
prediction of what
activity costs will be as
activity output changes.

MANAJEMEN BIAYA Minggu 9 Page 31

Flexible Budget: Direct Labor Hours

Cost Formula Direct Labor Hours

Fixed Variable 10,000 20,000
Direct materials --- $10 $100,000 $200,000
Direct labor --- 8 80,000 160,000
Maintenance $ 20,000 3 50,000 80,000
Machining 15,000 1 25,000 35,000
Inspections 120,000 --- 120,000 120,000
Setups 50,000 --- 50,000 50,000
Purchasing 220,000 --- 220,000 220,000
Total $425,000 $22 $645,000 $865,000 ========== =======
=======

MANAJEMEN BIAYA Minggu 9 Page 32

 Activity Flexible Budget
Driver: Direct Labor Hours
Formula Level of Activity
Fixed Variable 10,000 20,000
Direct materials --- $10 $100,000 $200,000
Direct labor --- 8 80,000 160,000
Subtotal $0 $18 $180,000 $360,000
== ===

Driver: Machine Hours

Fixed Variable 8,000 16,000
Maintenance $20,000 $5.50 $64,000 $108,000
Machining 15,000 2.00 31,000 47,000
Subtotal $35,000 $7.50 $95,000 $155,000
====== ====

MANAJEMEN BIAYA Minggu 9 Page 33

Activity Flexible Budget (continued)
Driver: Number of Setups
Fixed Variable 25 30
Inspections $80,000 $2,100 $132,500 $143,000
Setups --- 1,800 45,000 54,000
Subtotal $80,000 $3,900 $177,500 $197,000 ====== =====

Driver: Number of Orders

Fixed Variable 15,000 25,000
Purchasing $211,000 $1 $226,000 $236,000 =========
Total $678,000 $948,000
==============

MANAJEMEN BIAYA Minggu 9 Page 34

Activity-Based Performance Report

Actual Costs Budgeted Costs Budget Variance

Direct materials $101,000 $100,000 $1,000 U
Direct labor 80,000 80,000 ---
Maintenance 55,000 64,000 9,000 F
Machining 29,000 31,000 2,000 F
Inspections 125,500 132,500 7,000 F
Setups 46,500 45,000 1,500 U
Purchasing 220,000 226,000 6,000 F
Total$657,000 $678,500 $21,500 F ======= ======= ======

MANAJEMEN BIAYA Minggu 9 Page 35

Variances for the Inspection Activity

Activity Actual Cost Budgeted Cost Variance

Inspection:
Fixed $ 82,000 $ 80,000 $2,000 U
Variable 43,500 52,500 9,000 F
Total $125,500 $132,500 $7,000 F ==============
=====

MANAJEMEN BIAYA Minggu 9 Page 36

 Financial Perspective

The financial perspective have three strategic

themes:
 Revenue Growth
 Cost Reduction
 Asset Utilization

MANAJEMEN BIAYA Minggu 9 Page 37

Summary of Objectives and Measures:
Financial Perspective
Objectives
Revenue Growth:
Increase the number of new products
Create new applications
Develop new customers and markets
Adopt a new pricing strategy
Measures
Percentage of revenue from new products
Percentage of revenue from new applications
Percentage of revenue from new sources
Product and customer profitability

Cost Reduction:
Reduce unit product cost Unit product cost
Reduce unit customer cost Unit customer cost
Reduce distribution channel cost Cost per distribution channel

Asset Utilization:
Improve asset utilization Return on investment
Economic value added

MANAJEMEN BIAYA Minggu 9 Page 38

Summary of Objectives and Measures:
Customer Perspective
Objectives
Core:
Increase market share
Increase customer retention
existing customers
Increase customer acquisition
Increase customer satisfaction
Increase customer profitability
Measures
Market share (percentage of market)
Percentage growth of business from
Percentage of repeating customers
Number of new customers
Ratings from customer surveys
Customer profitability

Performance Value:
Decrease price Price
Decrease postpurchase costs Postpurchase costs
Improve product functionality Ratings from customer surveys
Improve product quality Percentage of returns
Increase delivery reliability On-time delivery percentage
Aging schedule
Improve product image and reputation Ratings from customer surveys

MANAJEMEN BIAYA Minggu 9 Page 39

Summary of Objectives and Measures:
Process Perspective
Objectives
Innovation:
Increase the number of new products
Increase proprietary products
Decrease new product development time
Measures
Number of new products vs. planned
Percentage revenue from proprietary
products
Time to market (from start to finish)

Operations:
Increase process quality Quality costs
Output yields
Percentage of defective units
Increase process efficiency Unit cost trends
Output/input(s)
Decrease process time Cycle time and velocity
MCE
MANAJEMEN BIAYA Minggu 9 Page 40
Summary of Objectives and Measures:
Process Perspective (continued)

Objectives Measures

Postsales Service:
Increase service quality First-pass yields
Increase service efficiency Cost trends
Output/input
Decrease service time Cycle time

MANAJEMEN BIAYA Minggu 9 Page 41

 Process Perspective (continued)

Definitions
Cycle Time: The time required to produce one unit of product
Velocity: The number of units that can be produced in a given
period of time (e.g., units per hour)
Manufacturing
Cycle
Efficiency
(MCE) = Processing time

Processing time + Move Time +

Inspection Time + Wait time

MANAJEMEN BIAYA Minggu 9 Page 42

Operational Measure of Responsiveness
(time based) (continued)
Example 1
A plant has the theoretical capability of producing 10,000 bikes per
quarter. There are 20,000 production hours available each quarter.
Compute the theoretical cycle time and velocity.
Cycle time = 20,000 hrs/10,000 bikes
= 2 hrs per bike
Velocity = 10,000 bikes/20,000 hours
= 0.5 bikes per hour

MANAJEMEN BIAYA Minggu 9 Page 43

Operational Measure of Responsiveness
(time based) (continued)
Example 2
A product has the following activities and times:
Processing (three departments): 10 hours
Moving (four moves): 3 hours
Waiting (for the second and third processes): 8 hours
Storage (before delivery): 19 hours
Compute MCE.
MCE = 10/(10+3+8+10) = 10/40
= 0.25 or 25%

MANAJEMEN BIAYA Minggu 9 Page 44

Summary of Objectives and Measures:
Learning and Growth Perspective
Objectives
Increase employee capabilities
Increase motivation and alignment
Increase information systems capabilities
feedback capabilities
product information
MANAJEMEN BIAYA
Measures
Employee satisfaction ratings
Employee turnover percentages
Employee productivity (revenue/employee)
Hours of training
Strategic job coverage ratio (percentage of
critical job requirements filled)
Suggestions per employee
Suggestions implemented per employee
Percentage of processes with real-time
Percentage of customer-facing employees
with on-line access to customer and
Minggu 9 Page 45
End of Chapter 14

MANAJEMEN BIAYA Minggu 9 Page 46