Yves Levant

Cost modeling in logistics using time‐driven ABC: Experiences from a wholesaler

Purpose - The purpose of this paper is to describe the experiences of a wholesaler with time-driven activity-based costing (TDABC). Three research questions are addressed: How are complex logistics operations modeled by TDABC? Does TDABC provide more accurate cost information than activity-based costing (ABC)? How is TDABC cost information used? Design/methodology/approach - Case study research was performed at a Belgian wholesaler. Interviews were conducted. The cost and activity database was analyzed. Findings - This case study illustrates that there are logistics operations that cannot be modeled using a single cost driver, as is done with ABC. TDABC uses time equations to estimate the time spent on each activity. The results herein show how the time equations can capture the different complexities, by including different terms or interaction terms in the time equations. The database analysis clearly demonstrates that TDABC provided more accurate cost information than ABC at this case company. ABC oversimplified 64 percent of the activities, and misallocated 55 percent of all indirect costs. Research limitations/implications - This study is one of the first, investigating the experiences with TDABC. The results are derived from analyzing all activities, at a single case company. Practical implications - The study illustrates the technique of TDABC and provides a real company example of time equations in logistics. The users declared the TDABC model very useful for profitability reporting and profit management. The time drivers provided insight into the causes of excessive distribution and logistics costs. Originality/value - This paper complements current discussion on cost drivers and subtasks and logistics costing.

Georges Perrin and the GP cost calculation method: the story of a failure

After the Second World War, a number of costing methods were developed in France in response to the perceived limitations of Rimailhos ‘homogeneous sections’ method. The common feature of all these methods was the provision of a more thorough analysis of operations through the adoption of techniques which were simple to use. The GP method, developed by Georges Perrin, was the most successful but, despite its many advantages, its success was limited, due to deficiencies in Perrins communication policy and his network of contacts.

Can cost and financial accounting be fully re-integrated? The role of the French state in the separation of accounting systems and the failed attempt of the système croisé to re-integrate them

This article questions whether the separation of financial and cost accounting in France is an irreversible trend. We begin by showing that the integration of financial and cost accounting was quite “natural” up until the 1940s. We then show that after that date, State-imposed standardization of financial accounting led to separation of the two types of accounting. Last, we study the efforts of one individual, Jean-Pierre Lagrange, to promote a return to an integrated accounting system in the 1980s by means of his method named the système croisé. His efforts were in vain. In our opinion, this failure was not due to technical reasons, but can be attributed to the interaction of the interests of the main actors. Among these actors, the State played a dominant role in France by standardizing financial accounting. In addition, Lagrange was unable to obtain the backing of a network of allies to spread his accounting system.

Business simulation as an active learning activity for developing soft skills

ABSTRACT Business simulations are innovative instruction models for active or cooperative learning. In this paper, we look at the social constructionist roots of these education models in light of the current efforts to enhance employability skills in undergraduate and graduate studies. More specifically, we analyse the role of business simulations in developing soft skills based on an international survey of students’ perceptions of developing soft skills during business simulations. Our objective is to test whether business simulations contribute to the development of soft skills and whether gender, ethno-cultural origin, and professional experience affect the acquisition process. We also discuss the use and benefits of these innovative instruction models. The analysis suggests the need to take into account specific factors, especially ethno-cultural origin, when instructing via business simulations. It also calls for sharing best practices in the context of a globalised education.

From adoption to use of a management control tool: Case study evidence of a costing method

Purpose - The purpose of this paper is to investigate the processes involved in implementing a full costing method – the unite de valeur ajoutee (UVA) (added value unit) method – as well as to explore the uses made of it. Design/methodology/approach - Firms that adopted the UVA method between 1995 and 2009 were studied by means of semi-structured interviews with individuals concerned in the firm and with the external consultants. The interviews, which lasted two to three hours, were conducted both during the implementation process and several months later. Secondary data in the form of all the documentation regarding the initial setting up and updating of the method were also collected. Findings - The main advantages of the UVA method are the fine breakdown of costs, facilitating decision making, and its modest use of resources. Generally, it was adopted by small firms with a “defensive” strategic behaviour. The success of its implementation was largely a result of the strong involvement of management. Nevertheless, it found limited use as a management tool compared to the activity based costing (ABC) method, owing to the small size of the firms that adopted the UVA method. Originality/value - This research paper is the first to examine the various stages of setting up the UVA method of cost accounting method, by collecting data from users on two occasions, separated by an interval of eight years.

Contemporary evolutions in costing methods: Understanding these trends through the use of equivalence methods in France

At the beginning of the 1950s, the main costing methods used in France, including the so-called sections homogènes method, were subjected to a lot of criticism because of their excessive complexity. This opened the door to new equivalence methods that claimed to offer a solution to the problem. They were, however, supplanted by the simpler direct costing method that came into use in France in 1960s, and just about fell into oblivion. The economic situation at the end of the 1980s nevertheless rekindled interest in the allocation of indirect costs, including the Activity Based Costing (ABC) method. Setting up this method, however, presented problems that were similar to those of the sections homogènes method, thus favouring a rebirth of equivalence methods, to which Time Driven ABC (TDABC), which appeared in 2005, can be linked. In this article we retrace this history, combining economic factors and the determinism inherent in the technique, in order to examine how methods of costing have evolved with regard to relative complexity.

Charles Eugène Bedaux (1886–1944): ‘cost killer’ or Utopian Socialist?

Charles Eugène Bedaux is best known by social scientists for his labour organisation method. This method was a great success with companies during the interwar years, thus enabling its author to set up a multinational business consultancy. The Bedaux method was, however, violently contested by employees and their unions, who organised many strikes to protest against it. Some of those who knew Bedaux, however, claimed that his method was in reality merely one part of a larger system, a simple component working towards a broader and more generous vision of society (known in French as équivalisme). His project was inspired by the Utopian Socialists of the last century, intended to provide a solution to the widespread disorder experienced by industrial societies during the interwar period. This paper explores the credibility of this project from two perspectives: a critical examination of his biographies and investigations conducted in the places where experiments in ‘equivalism’ were supposedly undertaken.

Epistemology and management science: Is accounting history still a legitimate subject of study?:

Is there any point in researching accounting history? To answer this question, the first part of this article considers some epistemological ideas based on Popperian and pragmatist philosophies. Using the conceptual framework developed by the philosopher André Comte-Sponville, the article proposes a distinction between scientific knowledge, sophism, scholastics and pragmatism. By applying this framework to management research methods, it shows that hermeneutic-historical and research-action approaches have some legitimacy in opposition to those methods based on passing trends or that degenerate into scholasticism. The second part illustrates the conceptual framework based on the particular case of accounting history. Its intellectual value is underlined as well as its contribution to the creation of new systems and to denouncing those based on sophism. We then warn of the risks facing this discipline should it ever fall into introspection and neglect and the impact it should have on management practices. The authors present a series of proposals for avoiding yielding to scholastics.

The Implementation of a New Cost Analysis Method: The Case of the GP Method

The aim of this paper is to present the cases of all the businesses that have decided, during the past ten years, to put into practice the GP method of cost analysis. This was developed half a century ago and is still diffused as the UVA (Unite de Valeur Ajoutee) method. These observations illustrate the main advantage of this approach: a refined cost analysis using limited means.

The Republic of Salé (1627–1641/1666); an alternative pirate organization model?

Abstract Critical management authors are constantly searching for alternative models. We could learn from the study of the functioning of pirate communities, for example. It would have been important for the critical authors to have an example of a real pirate city organized under libertarian principles, such as the Republic of Salé (1627–1641/1666). Unfortunately, the study of this case, based on historical sources, shows that it was not an ideal pirate city, but rather a maritime city state, a plutocracy, inserted in national and international trade networks. Even when demythologized, the pirate utopia remains a fascinating part of our collective imaginary and thus could provide us with solutions to the limitations of existing models. One could, however, say that fully assumed fiction would have more impact than this false reality to which is attributed things that did not even exist.