BKFin.com

BKFin.com

provides banks access to sophisticated financial information
and analysis systems over the Web. The company combines these tools with
benchmarking data access, including e-mail and wireless communications,
so that banks can instantly evaluate individual loan applications and
entire loan portfolios.
BKFin.com’s CEO Jon Wise is happy with the
company’s growth. To better focus on client service, Wise is considering
outsourcing some functions. CFO Jenny Lee suggests that the company’s
e-mail may be the place to start. She recently attended a conference and
learned that companies like Continental Airlines, DellNet, GTE, and NBC
were outsourcing their e-mail function. Wise asks Lee to identify costs
related to BKFin.com’s in-house Microsoft Exchange mail application,
which has 2,300 mailboxes. This information follows:
Variable costs:
E-mail license…………………………………………………………………. $7 per mailbox per month
Virus protection license …………………………………………………… $1 per mailbox per month
Other variable costs………………………………………………………… $8 per mailbox per month
Fixed costs:
Computer hardware costs………………………………………………… $94,300 per month
$8,050 monthly salary for two information technology
staff members who work only on e-mail …………………………. $16,100 per month
Requirements
1. Compute the total cost per mailbox per month of BKFin.com’s current e-mail function.
2.
Suppose Mail.com, a leading provider of Internet messaging outsourcing
services, offers to host BKFin.com’s e-mail function for $9 per mailbox
per month. If BKFin.com outsources its e-mail to Mail.com, BKFin.com
will still need the virus protection software, its computer hardware,
and one information technology staff member, who would be responsible
for maintaining virus protection, quarantining suspicious e-mail, and
managing content (e.g., screening e-mail for objectionable content).
Should CEO Wise accept Mail.com’s offer? 3. Suppose for an additional $5
per mailbox per month, Mail.com will also provide virus protection,
quarantine, and content-management services. Outsourcing these
additional functions would mean that BKFin.com would not need either an
e-mail information technology staff member or the separate virus
protection license. Should CEO Wise outsource these extra services to
Mail.com?

Is this the question you were looking for? If so, place your order here to get started!