Scorecard Concept Description

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Guide to ECR concepts

Demand Management

Supply Management

Concepts

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Integrators

I2. Cost/Profit and Value Measurement

	Score	0	1	2	3	4
Concepts	General Meaning	Nothing Planned	Plans agreed but have not yet started implementation	Pilot tests being conducted	Roll out of implementation started	Fully Implemented
Activity Based Costing (ABC)	Use of ABC techniques to analyze supply chain costs related to specific activities, channels, customers or groups of consumers.	No ABC costs collected. Costing system provides limited or no visibility asto resources and cost drivers.	Plans are in place to begin using ABC concepts. Joint decisions still based on traditional measures.	Activity costs are measured on part of the company's cost structure and are used for a limited amount of decision making.	All busines activity costs are measured on an ad hoc basis and are used for decision making as the need arises -- an ABC modelling approach is occasionally used as the basis for joint decision making.	All information systems have incorporated ABC costs and use of ABC techniques is the standard. All joint decision making leverages ABC activity costs.
Consumer Value Measurement	Use of value measurement methods to analyze business decisions in terms of value-added versus cost for consumers, the company and shareholders.	Consumer value is not measured and there are no plans to develop these capabilities.	The importance of measuring consumer value is recognised, key measures have been defined and plans to develop measurement capabilities agreed.	Prototypes of consumer value measurement systems are being pilot tested to refine understanding and assess cost and benefits.	Consumer value is routinely measured, analyzed and reported, but the results are not fully integrated management systems, nor consistently used for major business decisions. Consumer value linkage with Shareholder value starting to emerge.	Consumer value is routinely measured, analyzed and reported, and the results are fully integrated into management systems and used routinely to support major business decisions. Consumer value effectively linked to shareholder value.

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