Activity-based cost management. Part II: Applied to a respiratory protection program.
To demonstrate the relevance of activity-based cost management (ABCM) for the occupational and environmental health community, the investigators used data generated by an ABCM model of a respiratory protection program (RPP) to develop options for solving a business problem. The RPP manager in this hypothetical but realistic business scenario is faced with a 25% budget cut and a 10% increase in demand for RPP services. The manager's dilemma is to maintain the integrity of the RPP while absorbing a significant budget cut. Various cost savings options are developed, and the assumptions under which these options operate are presented. It is emphasized that the RPP manager's primary responsibility is to assure worker health and safety by first understanding the technical issues, merits, and implications of any cost-cutting option that may be considered. It is argued that only then should the manager consider the financial merits of the possible solutions to this business problem. In this way worker health and safety, and environmental protection goals, can continue to be achieved in an economic climate of cost cutting and downsizing.
Brandt
M T
MT
Los Alamos National Laboratory, Environmental, Safety and Health Division, NM 87545, USA.
Levine
S P
SP
Smith
D G
DG
Ettinger
H J
HJ
Gallimore
B F
BF
D000066:Accounting / Q000379:methods*; D002017:Budgets; D003361:Cost Allocation / Q000379:methods; D003363:Cost Control; D003365:Costs and Cost Analysis; D004782:Environmental Health / Q000191:economics*; D006801:Humans; D019570:Inhalation Exposure / Q000517:prevention & control*; D017146:Models, Organizational; D009786:Occupational Health Services / Q000191:economics*; D012134:Respiratory Protective Devices / Q000191:economics*