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Hi Sir,
Part (b)
1. How do we know which aspects do we talk about when the question says “improve business performance”? It’s very broad and general.
2. Is there some kinda matrix or certain few aspects that we need to cover?
Also, ABM is said to be used as performance management and performance improvement.
3. How so we distinguish both?
4. As well as not to write unnecessary points relating to performance management since this question is asking about performance improvement? (Or do they come hand in hand?)
Thank you in advance, Sir!
Also, I do understand that ABM can be performed at two levels, operational and strategic.
However, why does the answer in part (b) relate to performance measurement? Does it relate to either operational or strategic ABM?
1 Depends on the business and information provided. ABC deals only with fixed cost accounting so look to see whst fixed costs might be better understood and managed.eg storage, transfer and inspection costs.
2 No
3 and 4 Performance management is hitting current targets; peformance improvement would be setting better targets. In fact, one runs on from the other as hitting current targets will often cause improvememt anyhow. Even withinmthe exam title, Advanced Performance Management, the idea of performance improvememt is really there.
Don’t worry about operational and strategic distinctions. They are really just differing time scales and differing scopes. Reducing inspection costs per unit by inspecting fewer units is operational; outsourcing inspection to achieve cost savings would probably be strategic. I think markers are grateful for any reasonable suggestions.
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