Which costing technique helps organizations optimize overhead costs in SAP FICO?

Activity-based costing (ABC) is the correct answer because it focuses on identifying and managing the costs associated with specific activities within an organization. This technique allows companies to allocate overhead costs more accurately by considering the actual resources consumed by each activity, leading to more precise product costing and profitability analysis.

By utilizing ABC, organizations gain insight into which activities are driving costs and how they can be optimized. This level of detail helps decision-makers identify opportunities for cost reduction, enhance operational efficiency, and support strategic planning. In contrast, other costing methods, while useful, do not provide the same granularity in understanding the overhead allocation.

Standard costing, for instance, relies on pre-established costs and does not necessarily reflect the actual resource consumption, which may lead to less accurate cost management. Budget variance analysis focuses on analyzing differences between budgeted and actual performance rather than optimizing cost structures. Process costing aggregates costs for similar products rather than providing insight into the specific activities causing overhead costs, which limits its effectiveness in overhead cost optimization.