Question

1. Prepare a memo for the management of Tesla Motors:

To explain how 'Activity Based Management (ABM)' and 'Activity Based Costing (ABC)' may help Tesla Motors achieve their strategic objectives

Answer 1

MEMORANDUM

DATE :20/03/2020

TO: Management

FROM : Jude, Director, Tesla Motors

SUBJECT : How methods to achieve strategic objectives is helpful.

As our company continues to grow, I wanted to inform you how 'Activity Based Management (ABM) and 'Activity Based Costing (ABC)' may help to achieve strategic objectives

ABC is not a method of costing, but a technique for managing the organisation better. It is a one-off exercise which measures the cost and performance of activities, resources and the objects which consume them in order to generate more accurate and meaningful information for decision-making.ABM supports business excellence by providing information to facilitate long-term strategic decisions about such things as product mix and sourcing. It allows product designers to understand the impact of different designs on cost and flexibility and then to modify their designs accordingly.

I would appreciate your cooperation during this time. I would seek more cooperation from you for the better implementation of these methods.