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Total software and services revenues were USD 22 billion in FY 2004-05. Indian IT-ITeS exports is expected reach US$ 42bn by 2010. Costing Models broadly are - activity based costing (ABC) - time and material - Fixed cost model - Dedicated capacity building.
Total software and services revenues were USD 22 billion in FY 2004-05. Indian IT-ITeS exports is expected reach US$ 42bn by 2010. Costing Models broadly are - activity based costing (ABC) - time and material - Fixed cost model - Dedicated capacity building.
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Total software and services revenues were USD 22 billion in FY 2004-05. Indian IT-ITeS exports is expected reach US$ 42bn by 2010. Costing Models broadly are - activity based costing (ABC) - time and material - Fixed cost model - Dedicated capacity building.
Copyright:
Attribution Non-Commercial (BY-NC)
Verfügbare Formate
Als PPT, PDF, TXT herunterladen oder online auf Scribd lesen
Market Overview • Over the past decade, the IT industry has become one of the fastest growing industries in India. • Total software and services revenues were USD 22 billion in FY 2004-05. • It is forecasted to register a growth of around 30-32% in FY 2005-06 • Indian IT-ITeS exports is expected reach US$ 42bn by 2010. • Over the years the industry evolved a sophisticated model of operations and created global delivery models (onsite-near shore-offshore). • The industry adopted sustainable solutions to various issues such as risk management, retention and cost management. Sector-wise break-up ( billion USD) 2005-06 2003-04 2004-05 (Est)
IT Software and Services
9.2 12.0 15.2 Exports
IT Enabled and Business
Process Outsourcing 3.6 5.2 7.3 Services Exports
Domestic Market 3.9 4.8 6.0
Total IT and related
16.7 22.0 28.5 services Costing Models
Broadly the costing models are
– Activity based costing (ABC) – Time and material – Fixed cost model – Dedicated capacity building – A combination of the above Activity based costing (ABC)
• ABC model is a systematic way of capturing effort and
cost at the source of development or service delivery based on the work breakdown structure of the project. • It has the potential to provide insight into what drives costs and profits across an enterprise. • It can provide managers with information that enables them to take meaningful and quick decisions such as pricing, key account negotiation and product strategy. • Rather than starting with the general ledger and working down through activities to cost objects it is far more effective to start with the cost objects themselves. Activity based costing Contin…
• There is a belief that activity-based costing (ABC) is
laborious and needs armies of accountants to generate any meaningful results. • Only to have them finally dismissed by line managers as being out of date and unreliable. • The ABC is time-consuming, cumbersome if we have to manually collect the data from a large number of contributors. • Which means that most management accountants cannot provide reports in line with business managers’ monthly management reporting cycles. Activity based costing Contin…
• Hence, acceptance and use of ABC was limited and
the reasons are many: – It is common with ABC to find activity dictionaries that run to many hundreds and occasionally thousands of activities, as extraneous activities that account for minute amounts of cost are included into the ABC system. – Such exhaustive list also make it difficult for the developer to enter data accurately. – In addition, few business units carry out only one activity. This means that increasing the number of activities in a model also increases the complexity. Activity based costing Contin…
– Traditionally, ABC data was collected by paper-based surveys
and therefore required collating and re-keying into the ABC model. – Furthermore, the information and insight generated by activity- based costing is worthless until executives and manager’s right across the organization can access it and use it in their decision-making. – Typically this means exporting the data out of the ABC application into spreadsheets or a business intelligence tools before manipulating it and distributing to management in a variety of formats that are meaningful to the stakeholders. – As a result the amount of time and cost expended in reporting can be extensive. Activity based costing Contin…
• However, the web-based ABC removes many of
the obstacles and can generate meaningful reports to aid managerial decisions. • Web-based ABC can have provision to schedule and monitor repetitive processes to collate data from many business units or remote branch contributors over the web. • Also pre defined reports can be generated in no time to help the line managers for business decision making. • Also, it can be integrated with the business intelligence portal already in place. Activity based costing Contin…
• More importantly, with the web-based ABC can provide
frequent reports to management, moving from quarterly to monthly reporting. • Management can be provided with monthly activity costs to understand trends in the unit cost and monitor the impact of initiatives designed to improve productivity and reduce costs. • The project managers can monitor cost and productivity data on a weekly basis using the predefined report feature. Implementing ABC model
• Identify major business units and functional teams.
• Identify all roles in each of the functional teams. • Identify major activities for each of the roles. • In identifying the major activities be realistic and don’t include activities that are rare and take very little time and inconsequential. • Build/configure the ABC in a web environment and design necessary reporting module. • Add all the members to the tracking system and assign them to various project. • Start tracking the activities/time for each business unit member including login and logout time. Implementing ABC model Contin…
• Be realistic to have a non project/non billable activities.
• Review project wise /team wise and unit wise analysis periodically. • Use user feedback to refine and improve the method of data capturing and reporting to tools. • Use historical data to analyze productivity and cost factors. Implementing ABC model Contin…
• Extend the model to capture quality related data and
the cost of rework by refining the activity list to capture rework. • Link quality and productivity data to individual and teams. • Use system to measure individual/team performance in terms of quality and productivity. • Establish benchmark for productivity, quality and cost parameters. • Export data to the organization wide ERP. Thank you Total Elements 0
Pedagogic Features Content per frame upto 150 word - raw content available 2
Content per frame over 150-250 words - raw content available 3
Mouseover/click text/tabs/flipbook 3
Problems/Scenarios 2
Case studies 2
Role Plays 2
Demonstration - Application simulation 2
Guided Practice with Hints - Application Simulation 3