Strategic Applications of Activity-Based Management in AviationAbstractThis paper attempts to link the benefits of activity-based management and activity-based costing to the strategic success of the transportation industry airplane. The study hypothesizes that the failure or distress of the airline industry is linked to the use of an inadequate traditional cost accounting method. The solution to the situation is to apply asset-based accounting methods in managing aviation-related industries to produce strategic and competitive advantage and resurrect the industry from bankruptcy. Strategic Applications of Activity-Based Management in Air Transport Business strategy, up until twenty years ago, was usually based on the idea of ​​doing things "the way they have always been done". Today's business strategy, however, is based on Total Quality Management (TQM), constant evolution and the company's need to establish a long-term competitive advantage. Just as business dynamics have changed since 1988, it logically follows that business operations should too. However, the airline industry seems to be stuck in the last century. Although the airline industry is undergoing a major process of international and economic reengineering, the airline industry is struggling to make a profit; this may be partly due to their use of conventional cost accounting methods, instead of a more contemporary cost accounting method. To develop and establish a competitive advantage, strategic managers use cost/resource analysis tools to help them make decisions about the best uses of the business. resources. Conventional or traditional cost accounting (TCA) methods, primarily used until the 1980s, assign all costs to a primary cost driver and a specific product or service. As effective as this system is for a simple or single-product manufacturing company, its effectiveness is lost when applied to business conditions outside of these parameters, as many 21st century aviation organizations have become. Traditionally, accountants arbitrarily add a large percentage of expenses to direct costs to account for indirect costs. However, as indirect or overhead cost percentages increase, this technique becomes increasingly inaccurate because indirect costs are not caused equally by all products. For example, one product might take longer to install on an expensive machine than another product, but because the amount of direct labor and materials might be the same, the additional cost of using the machine would not be recognized when the same large margin Cost percentage is added to all products.