Research On CHP Enterprise Activity-Based Cost Management

Under background of the current domestic and international economic environment, Chinese CHP enterprise were under dual pressures at home and abroad. the cost of the electric power industry increased sharply and its operating environment deteriorated, caused by national macroeconomic situation and the influence of electricity soar coal price. This required managers to drive the quality of cogeneration enterprise entirety management by raising the level of cost management. And ABC management mode could be overcome the limitations of CHP enterprise traditional cost management, making the cost management more effective. So research on CHP enterprise ABCM had far-reaching theoretical mean and high Realistic value.ABCM was a new centralize management method based on the ABC for the purpose of enhancing customer value and increasing enterprise profit. This paper firstly described the present situation of CHP enterprise cost management, contrasting the traditional cost management and ABCM, and analyzed the necessity of ABCM in CHP. Secondly it discussed the key steps of a success ABCM implementation, ABCM implementation plan, the basic principle of activity units classification, providing a solid theoretical basis for later empirical study. Next, taking a CHP enterprise as an example, it simply descripted and deeply analysed the activity and activity-chains. Based on this ananlysis , it proposed ideas of activity unit optimization and cost management: operation cost control mode, and flexible management thoughts, activity unit management ideas (including reducing activity, eliminating activity, sharing activity, activity choice), overall budget thought based on activity unit and specific schemes of activity optimization.