What is Activity-based management (ABM)?

activity based management is a management tool aims to evaluate the activities of the company which got allocated with indirect costs through the activity based costing allocation method. the aim is to increase  and encourage the activities that add value to the organization while trying to eliminate the activities that do not add value.

Approach to management that aims to maximize the value adding activities while minimizing or eliminating non-value adding activities.
The overall objective of ABM is to improve efficiencies and effectiveness of an organization in securing its markets.
It draws on activity based-costing (ABC) as its major source of information and focuses on (1) reducing costs, (2) creating performance measures, (3) improving cashflow and quality and, (4) producing enhanced value products.

ABM is an administrative method which examine how a company incurs cost from the standpoint of its activities rather than its products.
its aim is to maximize the value adding activities while minimizing or eliminating non-value adding activities.
OR In other words, we can say that the ABM is used to improve efficiency and effectiveness of an organization in securing its market.