Integration of Capacity-Driven Cost Approaches in Support of Lean Management: A Theoretical Study

Abstract

The study's goal is to combine cost techniques that employ capacity as a foundation for allocating indirect costs, avoiding the disadvantages of these approaches while merging their benefits into a framework that can accept changes in administrative thought. The emphasis is largely on two cutting-edge cost methodologies to assist lean management initiatives: time-driven activity-based costing (TDABC) and resource-consumption accounting (RCA). The study indicates the potential of building an approach that combines the substantial RCA base and the flexibility of TDABC into a framework suitable to boost lean management initiatives through a theoretical analysis.