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Bharti Airtel: Opportunity for Cost Reduction
 

Bharti Airtel: Opportunity for Cost Reduction

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Opportunity for Cost Reduction: An analysis with special reference to Bharti Airtel Nesa. Its a final presentation given on MBA curriculum of Dibrugarh University. ...

Opportunity for Cost Reduction: An analysis with special reference to Bharti Airtel Nesa. Its a final presentation given on MBA curriculum of Dibrugarh University.
For full project report with Synopsis, you can mail me at partha89.mahanta@gmail.com

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    Bharti Airtel: Opportunity for Cost Reduction Bharti Airtel: Opportunity for Cost Reduction Presentation Transcript

    • PRESENTED BY Partha Pratim Mahanta MBA 4th Semester Roll No. 83/11 OPPORTUNITY FOR COST REDUCTION: AN ANALYSIS WITH SPECIAL REFERENCE TO OPEX AT BHARTI AIRTEL LIMITED, NESA CIRCLE
    • INTRODUCTION TITLE OF THE PROJECT Opportunity for Cost Reduction: An analysis with special reference to OPEX at Bharti Airtel Limited, NESA ORGANISATION Bharti Airtel Limited, NESA Bharti House 6-Mile Khanapara, Guwahati- 781022 ORGANISATIONAL GUIDE Pankaj Kumar, DGM (Finance), NESA INSTITUTIONAL GUIDE Jyotish Barmah Deka Assistant Professor,NERIM
    • RESEARCH METHODOLOGY RESEARCH TYPE Analytical Research RESEARCH DESIGN Descriptive Research Design SOURCES OF DATA PRIMARY DATA • Schedules • Unstructured Interviews SECONDARY DATA • General Ledger Report • Annual Report • Broachers & in-house magazines • Journals • Websites STATISTICAL TOOL USED • Tabulation • Cross Tabulation • Line Diagram • Sub-divided Bar Diagram • Pie-Charts LIMITATIONS OF THE STUDY 1. Due to restrictions in the organization could access to a limited numbers of documents. 2. Non-proficiency in technical aspects of financial work in telecommunication companies might have hindered the research work. 3. Due to limited time could not study the all heads of OPEX individually. 4. Chances of some biasness could not be eliminated. STATEMENT OF THE PROBLEM 1. Bharti Airtel Limited establish a fixed OPEX budget mechanism. 2. There is a provision of revising the budget in NESA circle as per the company procedure as well. 3. In NESA, during the period of the study (1st Jan to 31st Dec 2012) no revised budget was done. 4. They rather stick to a fixed OPEX budget. 5. This study was undertaken to finding out the scope for cost reduction in OPEX under the principle of fixed budget mechanism.
    • OBJECTIVES OF THE STUDY To study the different heads of OPEX To study the different areas of cost reduction To study the scope for reduction in an OPEX To examine the trend of OPEX in different departments and zones during the period (January 2012-December 2012)
    • FINDINGS In Bharti Airtel Limited, NESA circle there are total 12 heads of OPEX. • Accounting expenses • License fees expenses • Maintenance & repairs expenses • Advertising expenses • Office expenses • Utilities expenses • Domestic travelling expenses, • International travelling expenses, • Conveyance expenses • Network expenses • Meeting & conferences expenses • Marketing expenses In Bharti Airtel Limited, NESA circle there are total 11 Departments. • Business Head Department • HR Department • SCM Department • Finance Department • Legal Department • IT Department •Marketing Department • Sales Department • CSD Department • Retail Department • OE Department There is a scope for cost reduction for domestic travelling expenses in business head, SCM, finance, legal, sales, CSD, retail and in OE department. Analysis
    • FINDINGS There is a scope for cost reduction for conveyance expenses in legal, sales, CSD and retail departments. Analysis- 2 For meeting and conferences expenses, the budgeted amount is sufficient. So, there is no scope for cost reduction for meeting and conferences expenses for all these departments. Analysis-3 • The domestic travelling expenses shows the inclined trend. • In conveyance expenses it shows the fluctuated trend. • In meeting & conferences expenses, it shows the diminishing trend. Analysis The trend of OPEX heads over the zones of NESA circle shows that the maximum employees belonging to Circle office incurred all the three OPEX heads expenses. Analysis-4
    • SUGGESTIONS The budget for OPEX head should be made according to the needs of the department. The monthly equal distribution of the budget should be avoided. The advance booking of train, air or hotel should be implemented, so that organization can be avail benefit of advance booking. The structure of pay-band allowance of employees should be restructured. The staff should minimize air travel wherever possible. It will reduce domestic travelling expenses in some extent. Encouraging employees to be more cost-conscious while travel can have positive effects, both financially and in other ways. Implementation of audio and video conferencing mode for meetings and conferences may be proved ideal.
    • CONCLUSION It is believed that cost controlled is cost reduction; more so, if it is related to OPEX cost in any organization.At Bharti Airtel, NESA, this study reveals that, its management give utmost care for OPEX control and its effective management; so that elements in OPEX cost does not stands as barriers for proper functioning of various cost centers in managing sales and profitability.It is found that the present methodology of OPEX management has scope for improvement besides the everlasting solution is only in continuous scaling and measurement of such head of expenditure can bring permanent solution to address the issue.
    • Examining the trends of Domestic travelling expenses (on yearly basis) -15 -10 -5 0 5 10 15 20 BusinessHead HR SCM Finance Legal IT Marketing Sales CSD Retail OE PERCENTAGEcHANGE DEPARTMENTS Departments Percentage of Change (%) Business Head 1.39 HR (12.94) SCM 0.45 Finance 2.78 Legal 4.29 IT (4.79) Marketing (0.16) Sales 17.08 CSD 0.34 Retail 7.47 OE 7.53BACK
    • Examining the trends of Conveyance expenses (on yearly basis) Departments Percentage of Change (%) HR (3034.79) SCM (121.82) Finance (0.91) Legal 1.57 IT (3034.79) Marketing (144.37) Sales 6.57 CSD 14.99 Retail 20.12 -100% -80% -60% -40% -20% 0% 20% 40% 60% 80% 100% HR SCM Finance Legal IT Marketing Sales CSD Retail PERCENTAGEcHANGE DEPARTMENTS BACK
    • Examining the trends of Meeting & Conferences expenses (on yearly basis) Departments Percentage of Change (%) Business Head (300.00) HR (13.40) Finance (143.90) Legal (39.07) IT (94.62) CSD (257.14) -350 -300 -250 -200 -150 -100 -50 0 BusinessHead HR SCM Finance Legal IT Marketing Sales CSD Retail OE PERCENTAGEcHANGE DEPARTMENTS BACKFINDINGS
    • Examining the trends of Domestic Travelling expenses on the basis of zone Zones Total Expenses (in Rs.) Percentage (%) Circle Office 3938424 60.24 Guwahati 496452 7.59 NES 1 146047 2.23 NES 2 718735 10.99 Upper Assam 1238435 18.94 Total 6538093 100.00 BACKFINDINGS
    • Examining the trends of Conveyance expenses on the basis of zone Zones Total Expenses (in Rs.) Percentage (%) Circle Office 1074562 36.89 Guwahati 844075 28.98 NES 1 488393 16.77 NES 2 393897 13.52 Upper Assam 111838 3.84 Total 2912764 100.00 BACKFINDINGS
    • Examining the trends of Meeting & Conferences expenses on the basis of zone Zones Total Expenses (in Rs.) Percentage (%) Circle Office 173048 100.00 Total 173048 100.00 BACKFINDINGS