Activity-based classification

The full name of ABC classification should be ABC classification inventory control method.

Also known as Pareto analysis or barreto analysis, Plato analysis, primary and secondary factor analysis, abc analysis, classified management, material key management, ABC management, Barrett analysis, we also call it the "80 to 20" rule. EMBA, MBA and other mainstream business education have introduced the enlightenment of ABC classification to enterprise management and its influence on managers' organizational decision-making. ABC classification of applied economics and business management was initiated by Italian economist vilfredo pareto.

ABC analysis is a common analysis method in warehouse management, and it is also a basic work and understanding method in economic work. The application of ABC analysis in warehouse management can easily achieve the following results: first, it reduces the total inventory; The second is to liberate the occupied funds; The third is to straighten out the inventory structure; Fourth, save management power.

In 1879, Pareto found that the income of a few people accounts for most of all people's income, while the income of most people only accounts for a small part. He showed this relationship with a picture, which is the famous pareto chart. The core idea of this analysis method is to distinguish primary and secondary factors among many factors that determine a thing, and find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it.

Later, Pareto method was continuously applied to all aspects of management. In 195 1, management scientist H.F.Dickie applied it to inventory management and named it ABC method.

From 195 1 year to 1956, Joseph Zhu Lan introduced ABC method into quality management to analyze quality problems, which was called pareto chart. In 1963, Peter ·P·f· Drucker extended this method to all social phenomena, making activity-based costing a widely used management method for enterprises to improve efficiency.

This rule identifies some controversial issues by ranking similar issues or projects. Through long-term observation, Pareto found that 80% people in the United States only own 20% of the property, while the other 20% people own 80% of the property in the country. Many things conform to this law.

So he applied this law to production. His main point is that you will get better results by reasonably allocating time and strength to a small part of A-total.

Of course, it is also dangerous to ignore Class B and Class C. In Pareto Rules, Class B and Class C receive much less attention than Class A.. ABC classification, also known as Pareto analysis, also known as primary and secondary factor analysis, is a commonly used method in project management.

It is an analysis method, which classifies and queues things according to their main technical or economic characteristics, distinguishes key points from general points, and thus determines different management modes. Because it divides the analyzed objects into three categories: A, B and C, it is also called ABC analysis.

In the analysis diagram of ABC method, there are two vertical coordinates, one horizontal coordinate, several rectangles and a curve. The left ordinate represents the frequency, and the right ordinate represents the frequency, expressed as a percentage. The abscissa represents the factors that affect the quality, which are arranged from left to right according to the influence size, and the curve represents the cumulative percentage of the influencing factors.

Generally speaking, the cumulative frequency of the curve is divided into three levels, and the corresponding factors are divided into three categories: Class A factors, the cumulative frequency is 0%~80%, which is the main influencing factor. In cumulative percentage, 80%~90% of Class B factors are secondary influencing factors.

Class C factors are general influencing factors, and the cumulative frequency is 90%~ 100%. Application and explanation of ABC classification ABC classification is a method to classify and arrange things according to their main technical and economic characteristics, so as to realize different treatment and management.

ABC Law is a law derived from Pareto Law 80/20. The difference is that the 80/20 law emphasizes grasping the key points, while the ABC law emphasizes distinguishing the primary and secondary, and divides the management objects into three categories: A, B and C.

195 1 year, management scientist dyke first applied ABC rules to inventory management. From 195 1 to 1956, Zhu Lan applied activity-based costing to quality management, and creatively formed another management method-Pareto diagram method.

In 1963, Drucker extended this method to a wider range of fields. 1.ABC rule and efficiency In the face of complex and messy processing objects, if you can't distinguish between primary and secondary, you can imagine that its efficiency and benefit can't be high.

However, by prioritizing and grasping the main objectives, we can certainly achieve twice the result with half the effort. For example, in inventory management, applying this rule can greatly improve work efficiency and benefit.

In a large company, there are usually many kinds of inventory, which may be hundreds of thousands or even hundreds of thousands. The management of trivial affairs makes managers very tired, but it has little effect, and there may be confusion, which may cause great losses: First, it is very difficult to make inventory and inspection, and it is difficult to ensure accuracy.

For unimportant materials, such as low-value consumables, the impact may not be great, but for important materials, such as key parts of products, if the count is wrong, it may lead to material shortage, and production will inevitably be affected, thus failing to meet market demand, losing market opportunities and losing customers. Second, it is difficult to control the stock.

The inventory of important materials should be monitored as a key point to ensure that there is no shortage of materials. Non-important materials can be reserved according to a certain expected amount because of their low importance and small capital occupation. If we carry out management, we may pay attention to a large number of unimportant materials and ignore the control of important materials.

There is a saying: "Picking up sesame seeds and losing watermelon", which means that people who can't apply ABC rules are also significant in our daily affairs. Faced with many problems, if we classify ABC and then deal with the main problems, the minor and unimportant problems will often be solved.

2. How to classify ABC The objects we are dealing with can be divided into two categories, one is quantifiable and the other is not quantifiable. For those that cannot be quantified, we can usually only judge by experience.

For those that can be quantified, classification is much easier and more scientific. We take inventory management as an example to illustrate how to divide it.

What is Abc analysis?

Because it divides the analyzed objects into three categories: A, B and C, it is also called ABC analysis. ABC cost method is also called activity-based costing, activity-based costing and activity-based costing. ABC analysis is an activity-based costing system. Some scholars believe that this idea of cost accounting originated from the idea of American accountant E.Kolher in the late 1930s and early 1940s. Kohler found that the traditional method of allocating indirect expenses by working hours could not correctly calculate the cost of hydropower industry, because compared with the labor mainly used for monitoring and maintaining equipment, the main cost of hydropower generation is indirect expenses such as depreciation and maintenance of fixed assets such as power generation facilities. Raw water does not need to be purchased from the market. Therefore, Kohler put forward "activity-based costing". ABC analysis method, also known as Paré analysis method, ABC classification management method and key management method, etc. It is an analytical method that classifies and queues things according to their main technical or economic characteristics, distinguishes key points from general ones, and implements different management. Because it divides the analysis objects into three categories: A, B and C, it is called ABC analysis method. ABC analysis method was put forward by Italian mathematical economist and sociologist viollet Paré in 1879. In 1879, when studying the distribution of individuals, barreto found that the income of a few people accounted for most of the total population income, while the income of most people only accounted for a small part. He showed this relationship with a picture, which is the famous barreto diagram. The core idea of this analysis method is to distinguish primary and secondary factors among many factors that determine a thing, and find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it. Later, barreto method was continuously applied to all aspects of management, and in 195 1 year, management scientist Dyke applied it to inventory management. Name the ABC method. 195 1 year-1956, Zhu Lan introduced ABC method into quality management to analyze quality problems, and called it pareto chart. 1963, Drucker extended this method to all social phenomena, making ABC method a widely used management method for enterprises to improve efficiency. The basic principle can be summarized as ". Classified management ". It divides the management objects into three categories: A, B and C, among which Class A is the key management object. The key is to distinguish between the general majority and the extremely important minority. Brief introduction of analysis methods ABC analysis method is also called Paré analysis method, ABC classification management method and key management method. It classifies and queues things according to their main technical or economic characteristics, and distinguishes between key and general. Analysis method of implementing differentiated management. Because it divides the analysis objects into three categories: A, B and C, it is called ABC analysis method. ABC analysis method was put forward by Italian mathematical economist and sociologist viollet Paré in 1879. When studying the distribution of individuals, barreto found that the income of a few people accounted for most of the total population income. Most people's income only accounts for a small part. He showed this relationship with a picture, which is the famous barreto diagram. The core idea of this analysis method is to distinguish primary and secondary factors among many factors that determine a thing, and find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it. Later, barreto method was continuously applied to all aspects of management, and in 195 1 year, management scientist Dyke applied it to inventory management and named it ABC method. 195 1-1956. Zhu Lan introduced ABC method into quality management and used it to analyze quality problems, which is the so-called pareto chart. Drucker extended this method to all social phenomena. Make ABC method a widely used management method to improve the efficiency of enterprises. The basic principle can be summarized as "prioritize and classify management". It divides the management objects into three categories: A, B and C, among which Class A is the key management object. The key is to distinguish between the general majority and the extremely important minority. fr=ala0_ 1_ 1。

Where does ABC classification apply? What are the advantages?

ABC classification was initiated by Italian economist vilfredo pareto. In 1879, Pareto found that the income of a few people accounts for most of all people's income, while the income of most people only accounts for a small part. He showed this relationship with a picture, which is the famous pareto chart. Later, Pareto method was continuously applied to all aspects of management. In 195 1, management scientist H.F.Dickie applied it to inventory management and named it ABC method. From 195 1 year to 1956, Joseph Zhu Lan introduced ABC method into quality management to analyze quality problems, which was called pareto chart. In 1963, Peter ·P·f· Drucker extended this method to all social phenomena, making activity-based costing a widely used management method for enterprises to improve efficiency.

The uniqueness of this analysis method is to distinguish primary and secondary factors among many factors that determine a thing, and to find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it.

The main point is that you will get better results by reasonably allocating time and strength to Class A (a small part of the total). However, it is also dangerous to ignore classes B and C. In Pareto rules, they are much less concerned than Class A..

ABC material classification

ABC classification of inventory and Pareto principle have similar ideas. Pareto chart was first used to explain a phenomenon in economics, that is, 20% of the population controls 80% of the wealth, which is summed up as "the important minority and the unimportant majority", which is the Pareto principle.

Pareto principle is also applicable to the inventory management decisions of enterprises (most decisions are not very important, but a few decisions have great influence). 1. Classify materials that account for 20% of the inventory unit but 80% of the total cost as Class A inventory; 2. Materials with inventory unit of 20%-50% and cost accounting for 15% of total cost are classified as Class B inventory; 3. Materials with inventory unit of 50%- 100% and total cost of 5% are classified as Class C inventory.

Letters A, B and C stand for different categories, and their importance is declining. There is no special significance in choosing these three letters, and it is not absolute to divide materials into three grades. This classification is not the only criterion that affects the importance of materials. In addition, there are other classification criteria: the unit cost of materials; Whether the resources of materials are easy to obtain; Lead time, material shortage cost, etc.

The key to the application of ABC method is how to divide the inventory materials of the management object into ABC three categories according to the classification index through qualitative and quantitative analysis, and then adopt corresponding control strategies, which is the basic idea of ABC classification. Second, the implementation strategy In practice, people often take the number of product varieties and the corresponding amount as the dividing standard. It should be emphasized that this is not the only standard for material classification, but a general ABC classification.

The general procedure of ABC classification is: 1. Confirm the annual usage of each material in the inventory; 2. Multiply the annual usage of each material with the material cost to calculate the annual usage of each material; 3. Add up the annual usage of all materials to get the total annual inventory; 4. Divide the annual usage of each material by the total annual inventory to calculate the annual total usage percentage of each material; 5. Classify the materials according to the percentage of annual use from big to small; 6. Check the distribution of annual usage and classify materials according to the percentage of annual usage. Thirdly, the purpose of classifying inventory by control strategy is to treat inventory units differently according to their utilization value, and to control them separately by using different inventory control strategies.

Generally speaking, for high-value class A materials, we should concentrate on controlling them to reduce the inventory; On the contrary, for low-value materials, such as Class C materials, a large inventory is usually kept to avoid shortage. The material control strategy can be implemented in the following aspects: 1. A. Materials-such materials should be strictly tracked, the ordering point and quantity should be accurately calculated, and they should be maintained frequently; 2. Class B materials-under normal control, higher limit control can be given only under special circumstances, and economic batch orders can be made; 3. Class C materials-the control is as simple as possible, and a large amount of inventory can be supplemented by semi-annual or annual inventory, giving the minimum operation limited rights control.

This ABC classification is simple and easy to use, which is helpful to analyze and control key materials. However, its shortcomings are also obvious: first, the criterion is not comprehensive, and it is difficult to classify scientifically only according to varieties and amounts. For example, some spare parts or more important materials have a great influence on production and a long procurement cycle, so they should also be classified as Class A materials. However, according to the general ABC classification, such materials may be classified as Class B or Class C.. Therefore, the classification of ABC depends not only on the variety and amount, but also on the importance of materials and the length of procurement cycle. Only by comprehensively considering these factors can ABC be reasonably distinguished.

In addition, the general classification is only a rough difference, because there are usually many kinds of materials, which are difficult to divide at one time, which is also difficult to control. Therefore, a more detailed, specific and targeted division method is needed. In addition, it should be noted that different products, such as purchased parts, self-made parts, independent demand products and related demand products, should be analyzed by ABC.

In the process of analysis, we can't ignore the demand and future development trend. The quantity of inventory and the focus of inventory management should be dynamically adjusted according to the changes of market demand. One minute it's class A material, and the other minute it's probably class B material. In addition, the warehouse management department and other departments (such as sales department and engineering department) should realize information sharing. If the sales department plans to give up a product within a certain period of time, it should feed this information back to the warehouse management department in time. The warehouse management department should also keep in touch with suppliers, because a product may not be produced due to market changes, so suppliers must obtain information in time to decide to adopt corresponding inventory management strategies.

What is ABC classification? Briefly explain the basic principles of ABC classification.

ABC classification, also known as Pareto analysis, also known as primary and secondary factor analysis, is a commonly used method in project management. It is an analysis method, which classifies and queues things according to their main technical or economic characteristics, distinguishes key points from general points, and thus determines different management modes. Because it divides the analyzed objects into three categories: A, B and C, it is also called ABC analysis.

Basic principle: among many factors that determine a thing, distinguish between primary and secondary factors, and find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it. Later, Pareto method was continuously applied to all aspects of management.

Extended data

Draw ABC analysis diagram:

Taking the cumulative project percentage as the abscissa and the cumulative capital occupation percentage as the ordinate, according to the data provided by the third and eighth columns of ABC analysis table, take points on the coordinate map, connect the curves of each point, and draw ABC curve.

According to the data corresponding to the ABC analysis curve and the ABC analysis table, determine the methods of three categories A, B and C, and mark the three categories A, B and C on the diagram to make the ABC analysis diagram. In management, if the ABC analysis chart is still not intuitive enough, it can also be drawn as a histogram. According to the results of ABC classification, the management intensity and economic effect are weighed, and the ABC classification management standard table is formulated.

Sogou encyclopedia -ABC classification

How to understand abc classification in detail

Size is divided into three categories: A, B and C, and then treated separately according to their importance. ? Class a material

Refers to the material with few varieties, small physical quantity and high value, and its cost accounts for about 70%, but it is real.

The turnover does not exceed 20%. ? Class C materials refer to materials with many varieties, large physical quantity and low value.

Capital, the cost of which accounts for about 10%, and the physical quantity is not less than 50%. ? Class b materials are between

Between class a and class c materials. Its cost accounts for about 20%, while the physical quantity does not exceed 30%.

? ABC can be used when the inventory of an enterprise is various, the unit price varies greatly and the inventory is different.

Classification can distinguish priorities, grasp key points and treat them differently, making inventory control more convenient and effective.

?

Principle and application scope of ABC classification

ABC classified inventory control method.

Also known as Pareto analysis or barreto analysis, Plato analysis, primary and secondary factor analysis, abc analysis, classified management, material key management, ABC management, Barrett analysis, we also call it the "80 to 20" rule. EMBA, MBA and other mainstream business education have introduced the enlightenment of ABC classification to enterprise management and its influence on managers' organizational decision-making. The theoretical basis of 1 ABC analysis

Anything complicated in society has the law of "key minority and general majority". The more complicated things are, the more obvious this rule becomes.

If the limited power is mainly (mainly) used to solve a few decisive things, and the limited power is evenly distributed in all things. Compared with the two, of course, the former can achieve better results, while the latter is slightly worse.

Under the guidance of this idea, ABC analysis method finds out the "key minority" through analysis and determines the appropriate management methods, which forms a class A thing that needs to be managed emphatically. This can achieve 7-8 times the effect of "getting twice the result with half the effort".

General steps of 2.2. ABC analysis Here, ABC analysis and key inventory management methods are taken as examples.

Generally speaking, the inventory of an enterprise reflects the level of the enterprise. By investigating the inventory of an enterprise, we can get a general understanding of its operating conditions. Although ABC analysis has formed a basic management method in enterprises and has wide applicability, it is still widely used in inventory analysis at present.

The general steps of ABC analysis are: collecting data, processing data, making ABC analysis table, determining classification according to ABC analysis table, and drawing ABC analysis implementation countermeasures. This is the process of classified management. According to the results of ABC classification, the management intensity and economic effect are weighed, and the ABC classification management standard table is formulated to manage the three types of objects differently.

Introduction to ABC classification

ABC classification was initiated by Italian economist vilfredo pareto. ABC analysis is a common analysis method in warehouse management, and it is also a basic work and understanding method in economic work. The application of ABC analysis in warehouse management can easily achieve the following results: first, it reduces the total inventory; The second is to liberate the occupied funds; The third is to straighten out the inventory structure; Fourth, save management power. In 1879, Pareto found that the income of a few people accounts for most of all people's income, while the income of most people only accounts for a small part. He showed this relationship with a picture, which is the famous pareto chart. The core idea of this analysis method is to distinguish primary and secondary factors among many factors that determine a thing, and find out a few key factors that play a decisive role in it and most secondary factors that have little influence on it. Later, Pareto method was continuously applied to all aspects of management. In 195 1, management scientist H.F.Dickie applied it to inventory management and named it ABC method. From 195 1 year to 1956, Joseph Zhu Lan introduced ABC method into quality management to analyze quality problems, which was called pareto chart. In 1963, Peter ·P·f· Drucker extended this method to all social phenomena, making activity-based costing a widely used management method for enterprises to improve efficiency.

This rule identifies some controversial issues by ranking similar issues or projects. Through long-term observation, Pareto found that 80% people in the United States only own 20% of the property, while the other 20% people own 80% of the property in the country. Many things conform to this law. So he applied this law to production. His main point is that you will get better results by reasonably allocating time and strength to a small part of A-total. Of course, it is also dangerous to ignore Class B and Class C. In Pareto Rules, Class B and Class C receive much less attention than Class A..

ABC classification, also known as Pareto analysis, also known as primary and secondary factor analysis, is a commonly used method in project management. It is an analysis method, which classifies and queues things according to their main technical or economic characteristics, distinguishes key points from general points, and thus determines different management modes. Because it divides the analyzed objects into three categories: A, B and C, it is also called ABC analysis.

In the analysis diagram of ABC method, there are two vertical coordinates, one horizontal coordinate, several rectangles and a curve. The left ordinate represents the frequency, and the right ordinate represents the frequency, expressed as a percentage. The abscissa represents the factors that affect the quality, which are arranged from left to right according to the influence size, and the curve represents the cumulative percentage of the influencing factors. Generally, the cumulative percentage of a curve is divided into three levels, and the corresponding factors are divided into three categories:

Class A factor is the main influencing factor, and its cumulative percentage is 0%~75%.

Class B factors, with cumulative frequency of 75%~90%, are secondary influencing factors.

Class C factors are general influencing factors, and the cumulative frequency is 90%~ 100%.