Explicit Cost Dynamics: An Alternative to Activity-Based Costing.

Explicit Cost Dynamics: An Alternative to Activity-Based Costing. By Reginald Tomas Yu-Lee. John Wiley & Sons, 220 pages. $49.95.

Most high-ranking financial officers are familiar with the concept of activity-based costing, which has gained wide popularity in recent years. But like most financial management techniques, it's been the target of skepticism -- and efforts to develop something better.

That's where explicit cost dynamics (ECD) comes in. Author Yu-Lee, a Ph.D and consultant in costing and information systems, offers this methodology as a way of maximizing profits. Traditional cost management systems often fall short by institutionalizing practices that don't optimize performance, he argues. ECD, on the other hand, creates a system "that cannot be manipulated to make performance numbers appear better, is well-suited to 'what-if' analysis and is far simpler than allocation-based models."

This is a serious volume, with a plethora of charts and tables, as well as mathematical equations. The writing style brings to mind a lot of high school textbooks, but at least it doesn't overreach and muddy what is already a complex subject.