Time-Driven Activity-Based Costing (TDABC) model for Performance Optimisation of Offsite Manufacturing Methods for Housebuilding

Offsite manufacturing (OSM) for construction is increasingly considered a means of improving the productivity and performance of the industry by incorporating innovative methods techniques and best practices. However, many offsite manufacturers face challenges in remaining competitive, partly due to the absence of an analytical performance evaluation model at the activity level for assessing and comparing production process designs. This study addresses this gap by developing a tailored Time-Driven Activity-Based Costing (TDABC) model for OSM to evaluate performance. A case study approach was employed, involving mixed-method data collection through observations, document analysis, interviews, and focus groups. The data were systematised using BPMN process maps and the tailored time equations were developed to analyse the cost and time associated with two different OSM processes, enabling comparative analysis. The TDABC model developed in this study offers two key contributions: (i) it enables OSM manufacturers to identify and use appropriate time drivers to evaluate the impact of production design on process costs, and (ii) it serves as a decision-making tool by providing analytical insights into critical areas for cost reduction, allowing inefficiencies to be designed out and competitiveness to be improved. The model's adaptability makes it applicable to a wide range of OSM production designs, offering a valuable framework for performance evaluation and process optimisation.