Fuzzy activity-based costing: An investment evaluation approach for management information system of a smart factory

Abstract

The investment in a smart manufacturing factory with corresponding management information systems is strategic, complex, and costly. This paper aims to develop a cost estimation framework for a smart factory management information system (SFMIS). This paper proposed a fuzzy activity-based costing (FABC) model for the evaluation of the SFMIS under conditions of uncertainty. The model presented a multi-step procedure to do the identification, estimation, determination, calculation, and computation of the resource costs, activity costs, and systems as cost objects. The fuzzy Delphi method is adopted, and seventeen experts are surveyed in two rounds of a questionnaire assessing the importance of resources, activities, systems, and industry type and company size. The proposed FABC cost estimation model is illustrated by a case study. This model can identify and allocate resources and estimate SFMIS costs accurately and efficiently. By using this FABC cost evaluation framework, policymakers facilitate smart factory implementation for its management information system under uncertainty.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Kung-Jeng Wang

Dr. Kung-Jeng Wang is a professor of the Department of Industrial Management, National Taiwan University of Science and Technology, Taiwan, ROC. Dr. Wang received his PhD in industrial engineering and MS in computer science from University of Wisconsin at Madison (USA). His current research interests are in the areas of operations management and intelligent systems.

Melissa T. A. Simarmata

Miss Melissa T. A. Simarmata is a PhD program candidate from the Department of Information Management, National Taiwan University of Science and Technology. Her current research interests are in the areas of accounting management and information process reengineering.