The core of the ABRP system is the ABC ratio (see exhibit 2), a relative measure that represents how all the areas are using their resources.
Given that the salaries of permanent staff accounted for such a large proportion of the CPS's running costs, the significant variation under the ABRP approach (see column B of exhibit 3) would result in serious crisis for some area offices eg.
ABRP has proved to be a fairer approach to internal budget allocation.
A better method was urgently needed and the ABRP system, which helped to allocate limited budgets between areas based on their relative past performance, was seen by senior managers as "the better tool to allocate running-cost budgets cost-effectively".
There are four steps to a quantity structure and an effective ABRP process:
Quantities, not values, are used in ABRP so the omission of values in Step 3 has no effect on the planning result in Step 4.)
ABRP decreases the excess capacity account (Table 3) under the planning scenario to compensate for increased cabin crew demand.