Current construction industry requires effective process improvement to enhance the productivity and managerial capability. However, construction projects are found to have a limited number of tools for process management on construction sites. Activity-based costing (ABC) technique can provide insightful information on areas for process improvement to minimize waste or non-value-adding activities. However, the ABC has the limitations in reflecting complicated and interactive nature of construction processes. This paper explores how ABC can be practically used for construction process improvement with the support of discrete event simulation (DES) technique. Activity hierarchy is presented as a way to allow sustainable activity cost tracking. The proposed approach can contribute to facilitating easy and practical process control on a basis of more accurate cost information
Activity-based costing, discrete event simulation, process improvement.