An American Red Cross employee in Vermont recently started a new business: Recession Ride Taxi. Displaying recession-era innovation at its finest, he doubled up his SUV as a taxi and printed the words "Pay What You Can" at the back, asking patrons to pay what they feel is decent. He says he’s never been stiffed, and business is pretty good with him making over $600 in two weeks. ( We have invented this long time back ....Share Auto....)
With a slightly larger amount at stake is Media Mogul Rupert Murdoch, who suffered losses of over £2 billion as a result of collapse in advertising revenues, pushing him to describe 2009 as the “most difficult in recent history.” His solution? Charge customers for accessing the online news content of his newspapers.
Clearly, the tough economic environment has prompted individuals and companies to relook at the way they do business and has spawned alternative retooling of cost structures. For providers in the outsourcing space, this transformation comes in the form of the ‘pay as you go’ business model where transaction pricing is based on the number of transactions.
For instance, in the accounts payable world, you can either get paid based on the number of full time employees or the number of invoices you process (pay by drink) However, as you improve the rate of processing invoices, if you ask a CFO what their ideal situation is, they won’t say they need us to process it at 1 cent lower cost or 2 days faster--they’ll want more discounts from their suppliers – the lowest possible price. And the ultimate evolution of this model would be when the provider gets paid based on the delivery of those metrics.
Courtesy - Tiger COO- Genpact
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