ABB Industries: Implementing SAP's ABC

ABB Industries was told to implement activity‐based costing (ABC) for costing in their consolidated reports sent to ABB Group, their parent firm. To meet this need, they chose to implement ABC using SAP's R/3. For two of nine product lines, parallel ABC was developed. Unfortunately, the version of ABC needed to generate financial statements, operational ABC, would not be available until a later release of the software. While ABB Industries waits for the next release, key personnel associated with the implementation are being offered alternative internal and external opportunities. Further, in order for ABB Industries to implement the operational ABC, the entire firm must implement a new version of SAP's R/3.