The correct answer is: Not all activities are value adding and so activities must be examined and split up according to their ability to add value.

It is traditional budgeting which may make managers ‘responsible’ for activities which are driven by factors beyond their control. For example, the cost of setting up new personnel records and induction training is driven by the number of new employees required by managers other than the personnel manager.

ABB recognises that additional measures which focus on drivers of costs, quality of activities undertaken, the responsiveness to change and so on are needed.

ABB recognises that it is activities which drive costs and so the drivers (causes) of the costs should be managed.