2. Cost benefit analysis
Overview
 Cost-benefit analysis provides an organizational
framework for identifying, quantifying, and
comparing the costs and benefits (measured in
dollars) of a proposed policy action. The final
decision is informed (though not necessarily
determined) by a comparison of the total costs
and benefits.

3. General Information
 tool for comparing the benefits of proposed projects
with the costs.
 help users identify the alternative with the maximum
net benefit (benefits minus costs).
There are four basic steps to performing a cost-benefit
analysis:
 Identify the project or program and alternatives
 Describe quantitatively the inputs and outputs of each
alternative
 Estimate the value of the costs and benefits
 Compare benefits and costs

4. Application
 Gives manager a better understanding of the impact of
alternative courses of action in terms of costs and
benefits.
 Identify alternatives that are the most beneficial,
comparing projects that differ in magnitude and duration.
 Cost-benefit analysis requires the conversion of all
benefits and costs into common units.
 cost-benefit analysis is an important tool for helping
managers do the most environmental good with limited
time, funding, and other resources at their disposal.

5. Strengths
 Compares costs and benefits using equal terms
 Provides a clear indication of net cost or benefit
helping justify decisions at various levels
 Simplifies complex concepts and processes
 Accepted more readily than other economic methods
 Is all pervasive.

6. Limitations
 Difficult to determine accurately the discount rate of
future costs and benefits, as well as indirect impacts
 Often requires non market valuation methods with
varying degrees of complexity and accuracy
 Costs are easier to estimate than benefits
 Can be a time-consuming and expensive process
 Does not usually consider questions of
environmental justice and how costs and benefits
are distributed across different groups

7. Confidentiality
 Information having value and is worthy of
protection. Information relating to new products,
 trade secrets,
 financial performance ,
 customers
 valuable asset ,
 gives it an advantage over its competitors.
 Businesses guard this information closely.
 It is vital that this information is properly protected
from unauthorised use and disclosure.

8. Benefits of confidentiality
Protecting Sensitive Information
 Keep sensitive business information secret from
the public and competitors.
 special formulas, plans, processes or devices
that they use to gain an advantage over
competitors.
 confidentiality of such trade secrets can allow a
company to maintain its competitive advantage.
 For example, a soft drink company might keep
its recipe confidential so that no one can copy it
or use it to form new ideas.

9. Marketing Advantages
 Allows companies to pick and choose the
information actually released to the public.
 Sometimes, businesses do not want consumers
to know everything about the development of
their products.
 For instance, a software company might not want
to release information about software that is
under development because early versions of
software are often replete with problems that
need to be fixed before release.

10. Drawbacks
Marketing Drawbacks
 Decrease awareness of products and services.
 If a company updates consumers with news about
upcoming products and services, it can help create
demand for those products and services before they
become available.
 Transparency of business practices, such as
releasing information about how products are
produced, can also build consumer trust.

11. Information Leaks
 A major drawback of confidentiality is the
possibility of information leaks.
 Many companies choose to patent inventions,
which serves as legal protection against
anyone trying to copy the invention.
 If confidential information is leaked, a
company might not be able to defend its
intellectual property as effectively is it could
otherwise.

12. Security and confidentiality in
outsourcing
 Any organization that decides to outsource
part of its operations puts its reputation, along
with any data processed or customer
interactions performed on its behalf, in the
hands of a third party.
 Organizations need to consider who has
access to sensitive or confidential information
and how that access affects compliance with
regulations and policies.

13. Those responsible for the outsourcing process
should consider several issues, including:
 Will the vendor limit its employees’ access to
sensitive information?
 Is information stored at a vendor site? If so, is
every storage location known to the outsourcing
organization?
 What controls and security practices does the
vendor enforce to provide assurances that critical
information is handled appropriately?

14. Banks
Why Do Banks Outsource Activities?
By outsourcing through experienced service providers,
 a bank can quickly improve the quality of its services,
 increase its operational or financial efficiencies,
 and, in many cases, reduce costs.
 increase its focus on the core business functions,
 high capital investment and technology requirement
ACTIVITIES THAT ARE CURRNTLY OUTSOURCED
 Processing of applications collected which includes data capturing,
preparation of
bank schedules, etc.
 Clearing of instruments
 Tallying of Instruments and Reconciliation

15.  CRM and KYC software
 Setting up of ATMs
 Clearing of instruments
 Tallying of Instruments and Reconciliation
Analysis:
Outsourcing needed
But keep a close watch on how the disclosed
information is being handled.
No compromise with confidentiality.

16. Case studies
case 1
 October 2003 - Lubna Baloch and University of
California San Francisco Medical Center(UCSF)
 Facts:
- Compensation for work not paid
- Threatened to post medical records on the
Internet
 Result:
- Patients aggrieved
- No further work to Baloch from America
- Legal Action taken

17. Case 2
 Several offshore workers, based in Bangalore, India,
employed by Heartland Information Services of
Toledo, Ohio.
 Facts:
- Threatened to expose confidential information
unless they received payment.
- The officers of HIS failed to notify clients and
shareholders
- Something unexpected: One of their clients
filed a case against HIS for failing to disclose
the incident.
- Image damaged

18. How is India dealing with data
privacy and security issues?
 Most of the security fears unfounded.
-Strong legislation
-Clear agreements and measures set up between companies.
-Confidential data stored on servers of the companies that are
outsourcing and their Indian vendors have tightly controlled access.
 No reason to panic - One has to understand that Indian companies have
as much to lose as their clients if an incident were to occur. This is why
efforts to counter any mishaps are being taken.
 The country is not only moving up the value chain by offering more
complex services, but is determined to establish its trustworthiness.

19. Precautions
 Ensure that you have an exit plan
 Only disclose information to people who need to know
that information
 Ensure each recipient is under an obligation of
confidence owed directly to your business.
 Impose a requirement that all confidential information
must be destroyed or returned to your business when no
longer required.
 Keep accurate and up to date records of exactly what
information has been disclosed and to whom.
 Mark all sensitive and commercial information as
“confidential” prior to release.

20. Conclusion
Every piece of information when disclosed becomes
redundant”
Cost benefit remains a part of vital information for
the organisation, if disclosed may lead to
opportunities lost and other forms of damage.