The 123s of ABC in SAP

10SAP INTEGRATED ACTIVITY-BASED COSTING COMBINED WITH OROS MODELING CAPABILITIES

Earlier chapters addressed the ABC/M capabilities supported by the SAP R/3 business applications. Each of the key integration points between the CO submodules and CO-ABC was covered extensively. All of this information indicates that SAP R/3 provides a very robust costing engine to support a number of costing philosophies, the most important of which is Activity-Based Costing. In addition to the operationally integrated ABC functionality of R/3, SAP can support other analytics via the tandem use of SAP CO with the Oros software package from ABC Technologies.

ABC Technologies, Inc. (ATI), was founded in 1989, at the very beginning of the ABC movement. According to the company’s Web page (www.abctech.com), it is the leading provider of Activity-Based Costing software in the world. The Web page states that Oros software supports an integrated solution for “activity-based cost modeling, scorecarding/performance measurement, and planning capabilities enabling organizations to increase profits, seek growth opportunities, reduce costs, and streamline operations.” This chapter addresses only the Activity-Based Cost modeling. The Oros software package is a stand-alone ABC system. Therefore, it can be used as an example to represent the type of system addressed in detail in Chapter 2, in the “Distinct Differences” section. This chapter focuses only on the integration of Oros with the SAP R/3 CO module.