Outsourcing Activity is Boon or Bane: A Case Study of City Circle Bhopal

Abstract

Outsourcing is a very common word in these days. Outsourcing is nothing but allowing someone else to do your work for you so that you are able to devote your time to more important jobs. Outsourcing is a better way of doing business. It is used by small as well as huge business firms in achieving greater success. More and more firms are looking at new ways to reduce costs and meet the pressures of increasing accountability. The main purpose of outsourcing is to take advantages of service providers of their expertise in non-core activities with the economies of scale in order to reduce the expenses and ensure quality services of M.P.M.K.V.V.Co.Ltd. It will help to reduce the incurred cost and improve their financial position. This research paper reflects cost effectiveness of outsourced MRBD activity of city circle Bhopal. The M.P.M.K.V.V.Co.Ltd. Bhopal carried out various activities to run their business, out of them some activities were outsourced. This research study covers only one activity i.e. MRBD. MRBD is a very important activity for any distribution company as the monthly receivables from consumers is largely depends on how effectively this activity is carried out. Efficient and accurate Meter reading and bill distribution not only results in high earning but also reduces the consumers complaints, most of which arises only due to wrong reading of meters. In this regard we have taken a case study of City Circle Bhopal and compare the cost of outsourced MRBD with the cost if these MRBD would be done departmentally and found that departmental cost is very high and we come to the conclusion that the outsourcing of MRBD activity is boon to the organisation.

Keywords: Outsource, Non-core, Service Provider, MRBD, in House, Receivables, Cost Effectiveness, Boon, Bane

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