Cost transformation & Indian service sector: A case study on companies in Gurgaon and Noida location
Purpose of this case study is to understand the upcoming concept of cost transformation in service sector. Identifying the major components of the cost and transforming cost with the help of studying and analyzing the cost structure of a service industry. Identifying the factors which lead to increase in cost in services sector for companies located in Gurgaon and how it can be reduced, if they can be shifted to Noida.
Cost transformation (CT) is an extended part of cost management and is an upcoming concept which gives long term impact of cost reduction in business. Reason for increase in focus on CT is the competitive market, it’s very difficult to increase income these days and so company focuses more on CT apart from working on income generating model.
The service sector consists of the production of services instead of end products. Services also known as intangible goods, it includes attention, advice, access, experience, discussion, and affective labor. The tertiary sector of industry involves the provision of services to other businesses as well as final consumers. Services may involve the transport, distribution and sale of goods from producer to a consumer, as may happen in wholesaling and retailing, pest control or entertainment. The goods may be transformed in the process of providing the service, as happens in the restaurant industry. Indian economy depends on Service Sector and it is also known as service sector economy. It is the most dominant sector in India’s GDP. It is also attracted large amount of foreign investment flows. India’s services sector covers a wide variety of activities such as trade, hotel and restaurants, transport, storage and communication, financing, insurance, real estate, business services, community, social and personal services, and services associated with construction.