Xu Ji Electric Company Case Study

4) Describe in details the real life companies that have adopted ABC especially on their success stories.
It is kind of hard to find the companies that are using the ABC system because some of them are facing lots of loss in their company but our group manage to find one which successfully use the system. In China, there is one company named Xu Ji Electric Co. Ltd that is using the system without failing. They learnt some successful techniques from the developed country like US and Japan (using the kaizen costing). They wanted to improve and widen their company by implementing the systems. This is a large Chinese manufacturing company which switched from a state-owned enterprise (SOE) to public limited company (PLC). The ABC systems not only changing the traditional costing systems, but it also acts as a catalyst to the company’s IT developments. They managed to implement the ABC in one of their main production divisions when ABC was at a theoretical level. With the low technology that they have in China back in 1990s, Xu Ji decided to improve their technological systems together with the management tools. With these, they could manage the ABC concepts easily and this is the caused for their success
Ltd is using ABC system because they urgently need a new system to replace the traditional system. Xu Ji Electric Co. Ltd wants a better costing system on tracing the direct labour costs directly to product and client contracts and also to allocate manufacturing overheads on the basis of update direct labour hours to contracts. The system that they used before have the inaccuracy for the costing information and this have affect their ability to compete on pricing. Xu Ji Electric starts to implement the ABC system on 2003 and they success on the implementation when some problems were solved. Some of the problems occur when the implementation needed that are the compatibility of information system and misinterpretation of ABC concept by IT