Cost Driver Analysis & Activity Based Costing

Most businesses struggle to understand why their costs behave the way they do. Expenses rise without explanation, margins tighten unexpectedly, and decisions about pricing, staffing, or scaling feel like guesswork. Traditional financial reports simply show what was spent — not what actually drives the spending. Without visibility into cost drivers, inefficiencies stay hidden, departments argue over budgets, and leaders hesitate to make moves because the financial impact is unclear.

Cost Driver Analysis solves this by giving you a clear, structured view of how costs flow through your business and what truly influences them. You gain visibility into fixed and variable behaviours, activity-level costs, efficiency bottlenecks, and the operational factors behind margin shifts. With this clarity, you can pinpoint waste, improve resource allocation, make pricing and staffing decisions confidently, and strengthen profitability with evidence — not assumptions. It’s analytics that replaces guesswork with control.

INDUSTRY EXPERTISE

Manufacturing

Financial Services

Healthcare

Business Process Outsourcing

Logistics

Core Modules

Cost Structure Mapping
Fixed vs variable, direct vs indirect, and main cost buckets clearly laid out.

Cost Centre & Category Mapping
Assigning costs to logical centres (departments, functions) and categories for visibility.

Cost Driver Identification
Systematic identification of what drives each major cost (volume, time,, channels, etc..)

Cost Trend & Variance Analysis
Historical trends + basic variance breakdown (period-on-period, budget vs actual).

Basic Cost Allocation Framework
Simple rule-based allocations of shared/overhead costs to products, services, or units.

Cost–Volume–Profit (CVP) View
Basic understanding of how volume changes affect total costs and breakeven from the cost side.

Clear, essential visibility into what drives your costs.

Insights that explain cost behaviour & reveal margin opportunities.

Multi-Level Cost Driver Tree
Visual and numeric mapping from resources → activities → outputs, showing how costs flow through the business.

Activity-Based Costing (ABC) Model
Standard ABC model for costing activities and assigning overheads to products/services.

Scenario-Based Cost Modelling
Impact of volume, mix, and policy changes (e.g. overtime, outsourcing) on total costs.

Efficiency & Utilisation Analytics
Cost impact of utilisation levels (capacity use, idle time, overtime, rework).

Cost Benchmarking (Internal / External)
Comparing cost levels and structures across periods, units, locations, or external benchmarks.

Cost Savings & Opportunities Map
Structured view of where and how cost improvements are possible & quantified impact.

Cost Impact on Margins (Focused View)
Linking cost drivers to high-level margin changes, without going into full profitability modelling.

Advanced Modules

model-driven costing systems that unlock strategic savings.

Time-Driven Activity-Based Costing
Time-based cost rates per activity, using capacities & time equations for higher accuracy

Predictive Cost Driver Modelling
Statistical/ML models to quantify how costs change with drivers (volume, service levels, etc.).

Cost Elasticity & Sensitivity Modelling
measures how sensitive cost pools are to volume, process or complexity changes .

Integrated Cost & Capacity Planning
Links cost drivers to capacity (people, machines, hours) to support planning and staffing decisions.

Cost Simulation & Risk Modelling
Simulates cost ranges under uncertainty (demand swings, price changes, disruption scenarios).

Cost Driver BI & Monitoring Dashboard
Ongoing monitoring of key drivers, cost pools, and efficiency via a dedicated cost-driver dashboard.

Cost Governance & Policy Framework
Defined rules, driver definitions, and update processes to keep cost models reliable over time.

Extended Modules