THE IMPLEMENTATION OF MARGINAL COST PRICING TO THE DECISION MANAGEMENT

Assagaf, Aminullah (2014) THE IMPLEMENTATION OF MARGINAL COST PRICING TO THE DECISION MANAGEMENT. The First International Conference on Enterpreneurship (ICEON). ISSN 2356-3206

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Abstract

The concept Margnal Cost Pricing (MCP) is particularly relevant when used in the environment of Government company or Badan Usaha Milik Negara (BUMN), especially for companies engaged in the field of community service and has strategic position in national economic growth. Pricing controlled by the government and Parliament or DPR to preserve the stability of the business, avoid inflation and unemployment. Therefore it is important for the ministry of state enterprises to study the application of MCP concept, since relevant research results have shown that the this concept has been widely used by developed countries such as American and European countries, especially in determining the electricity rates, train fare, busfare, ships fare, and public utility rates provided by the government. In an environment of Badan Usaha Milik Negara (BUMN) there were none research result that led to the implementation of this concept due to the following difficulties: (a) the mechanism that is influenced by political considerations, (b) consideration of qualitative decision-makers without using a quantitative basis, (c) lack of dissemination of this concept and its nation-wide application is very limited,(d) there has been no comprehensives studies in the environment of Badan Usaha Milik Negara (BUMN) related to the application of this concept, (d) in adequate financial statements or unadjusted yet since the accounting information is not realistic because of historical based reports, and others.Technically, the application of the MCP concept in the environment of Badan Usaha Milik Negara (BUMN) can be done, however the willingness and commitment of stakeholders are very required.This is where the role of corporate management in the environment of Badan Usaha Milik Negara (BUMN) or the ministry of Badan Usaha Milik Negara (BUMN) as Share holder meeting (RUPS)s as well as annual Share holder meeting (RUPS) meeting (RUPS) board initiate steps that begins with the study to convince the feasibility and benefits of the MCP implementation. The benefits are especially in improving the performance of related Badan Usaha Milik Negara (BUMN), reducing the burden of subsidies, and improving public services. Further more, this paper is expected to inspire the decision makers in the environment of Badan Usaha Milik Negara (BUMN) such asstate electricity company, railway company, Pelni, Damri, Hospitals, Pertamina, Gas, and other public facilities provided by the government.

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