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Title: CALL CENTER OPPORTUNITIES Author: Abdullah Butt Last modified by: Abdullah Butt Created Date: 11/27/2004 3:21:42 AM Document presentation format – PowerPoint PPT presentation

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Title: 29TH


1
29TH 30TH JANUARY 2005 -
KARACHI SHERATON
Presents
INTERNATIONAL CONFERENCE "CALL CENTER INVESTMENT
OPPORTUNITIES"
Supported by
2
THIS CONFERENCE BRINGS AN INVESTMENT OPPORTUNITY
FOR PAKISTAN FOR THE ESTABLISHMENT OF A 50
BILLION INDUSTRY WITH 30 PER ANNUM GROWTH RATE
LINKED WITH 700 BILLION E-COMMERCE TRADE
WORLD-WIDE!
3
INDIA IS THE WORLD LEADER TODAY IN THE CALL
CENTERSPAKISTAN HAS A CHANCE OF REPLACING
INDIA AS THE WORLD LEADER IN THIS INDUSTRY
4
WHY IS INDIA THE WORLD LEADER IN CALL CENTERS ?
  • Lower input costs, reasonably good
    infrastructure, a trained English-speaking
    workforce and a favorable time zone differential
    vis-à-vis the US have spurred the growth of the
    call center industry in India.
  • India has emerged as a major location for
    IT-enabled services such as call centers,
    customer support centers.

5
WHAT DID INDIA GET FROM THESE SERVICES ?
  • A revenue of US 2.3 billion, year ending March
    31, 2003, up almost 60 percent from the previous
    twelve months
  •   A prospect of Indian exports in this area
    exceeding 15 billion annually before the end of
    the decade.  

6
WHAT IS INDIAS POSITION TODAY ?
  • Today, there are almost 400 call centers
    operating in India (including "captive"
    operations, e.g. GE Capital) employing 170,000
    people in all of these centers.
  • Research indicates that over the next few years,
    about a dozen Indian call centers will have
    revenues in excess of 100 million.

7
PROMINENT PLAYERS IN THE CALL CENTER AND BPO
MARKET IN INDIA (2002)
  • Sales (million USD) People
  •        Wipro Spectramind 41 5000
  •        Daksh eServices 35 4,000
  •        WNS 35 2,500
  •        Exl Service.com 28 2,300
  •        OfficeTiger 25 1,000
  •       

8
PROMINENT PLAYERS (CONTINUED)
  • Sales (million USD) People
  • HCL Technologies BPO.. N/A 1,646
  • ICICI OneSource N/A 2,175
  • Hinduja TMT 24 1,400
  • MsourcE 20 3,162
  • Tracmail 11 1,000
  • Progeon 4.4 685

9
WHY HAS BEEN INDIA ATTRACTIVE ?
  • Entry barriers to set up a call center in India
    are low.
  • Typically, the average investment levels for a
    100-seat call center vary between Rs 40-60
    million (0.8-1.2 million).
  • Salary levels are at around 280-300 per month
    per person.
  • Currently the operational cost per seat per hour
    in India is approximately 10.
  • Estimates vary depending on location, skills,
    service levels, etc. As a rule of thumb it costs
    40-60  percent less to operate a call center in
    India than in the US.

10
WHAT CAN PAKISTAN OFFER OVER INDIA IN THIS
INDUSTRY?
  • There are many constraints for growth of Indian
    Call Centers that include
  • In the case of voice-based call centers, the
    Indian accent is considerably different from an
    American accent
  • Infrastructure problems Transportation for
    employees, power reliability, phone reliability,
    etc

11
CONSTRAINTS FOR GROWTH OF INDIAN CALL CENTERS
  • High attrition of employees -- 35-40 percent
    annual employee turnover is typical
  • Regulatory action against Indian vendors in
    reaction to job losses in the US. Several U.S.
    state legislatures are considering bills that
    would require state contractors to use U.S.-based
    employees

12
-CONT-
  • There is also a proposal to replace
    state-to-state customs duties (octroi) with a
    national value added tax. Both those tax
    proposals could be combined into a single scheme.
  • For India that is a blow on foot, for Pakistan
    that is a golden opportunity

13
OPPORTUNITY FOR PAKISTAN !
  • To take advantage of this scenario, Govt of India
    is all set to impose a income tax of 36 on all
    call centers owned by foreign companies
  • Plus, a proposal is under consideration in new
    Delhi to tax activities conducted over
    international private leased connections (IPLC)
    that carry most of India's voice and data traffic
    to and from the outside world.

14
SOME FOREIGN OWNED OPERATIONS
  • Examples of Captive Operations in IndiaGE
    Capital............... Customer service
    American Express......... Customer service
    Standard Chartered....... Back office admin
    EarthLink................ Customer service AOL
    Time Warner.......... Customer service
    Citibank................. Back office admin
    HSBC..................... Back office admin
    AXA...................... Insurance claims
    adjudication Willis................... Insurance
    claims adjudication American Annuity
    Group... Insurance claims adjudication
    Lufthansa................ Accounting, frequent
    flier programs World Bank............... Payroll
    processing McKinsey................. Research

15
WHY PAKISTAN ?
16
PAKISTAN OFFERS FOLLOWING ADVANTAGES OVER INDIA
  • Western experience
  • Executives at IT firms in Pakistan often have
    worked and gone to school in the U.S, which is
    Pakistan's largest export market.
  • Indian IT firms whose managers have worked in the
    West are generally more expensive than similarly
    positioned Indian firms,
  • without always providing noticeable differences
    in program implementation capabilities.
  • The willingness of Pakistanis to return home from
    the West stands in marked contrast to most
    Indians who arrive for school or work in the West
    and never look back.
  • Higher labor availability
  • Fewer holidays in Pakistan means less slippage in
    staff availability compared to India.
  • IT firms in India are advised to hire a diverse
    workforce so that members of one community can
    enjoy important festivals while members of other
    communities cover the phones and keep production
    going.

17
-CONT-
  • Good accents
  • Pakistan's official language is English.
  • Only Kolkata (formerly Calcutta) and the Punjabi
    areas of India can come close to competing with
    accents in Pakistan,
  • Language skills and accents provide Pakistan with
    a major advantage over all other Asian
    outsourcing destinations.
  • Low cost talent pool
  • India's top-tier labor force for IT work has been
    stretched thin, especially Bangalore, escalating
    wage rates, turnover and higher outsourcing
    prices are reaching critical mass.
  • The urban infrastructure has exceeded its
    carrying capacity.
  • Annual turnover rates reported to International
    Staff.net for most merchant call center
    facilities in India are approaching 100.
  • High turnover rates are causing a shift to second
    tier Indian cities and to Kolkata.
  • Escalating turnover rates are one of the Indian
    outsourcing industry's dirty secrets.
  • Whereas Pakistan's top-tier talent pool is
    largely untapped and turnover rates are less than
    20 percent.

18
WHAT PAKISTAN OFFERS
  • SWOT
  • Strengths
  • OK communication infrastructure with wide
    Internet connectivity getting cheaper and more
    reliable
  • Highly educated, English speaking work force
    engineers, computer experts, doctors, lawyers,
    MBAs, accountants
  • Returning professionals with foreign
    education/training
  • Local graduates of increasing number of high
    caliber institutions
  • Professionals trained at local operations of MNCs
  • Extensive Diaspora in N. America, UK, Europe and
    ME
  • Adoption of international standards CMM ISO
    900x
  • Supportive and increasingly relaxing government
    policies
  • Low cost of operations
  • Weaknesses
  • Image and perception
  • Missing service culture and customer orientation
  • Numbers not as large as Indias
  • PTCLs mindset and negative attitude towards any
    change in policies

19
PAKISTANS LABOR ARBITRAGE POTENTIAL
Sources (1) National Education Policy document,
Ministry of Education, Government of
Pakistan (2) Business Week (3) Industry
sources (4) TMT Ventures estimates
Pakistan is producing over 600,000 graduates
every year in various disciplines vs 2m in India
of these 30-50 are of the required quality
20
PAKISTANS LABOR ARBITRAGE POTENTIAL US SALARY
RATES
Source Business Week
Salaries in Pakistan are 5-10 of US salaries in
some trades as low as 2
21
PAKISTANS LABOR ARBITRAGE POTENTIAL CALL
CENTER COST COMPARISON
Source Nasscom Strategic Review 2003, Merill
Lynch, TMT Ventures estimates
The wage cost in India is just about one-fifth
or one-sixth of US levels. Salaries represent
only 50 of the total costs. When you add the
other costs (real estate, telecommunication,
utilities, etc) Indian operations would cost
about a third of what they would in the US.
Alok Aggarwal, Co-founder Chairman of
Evalueserve, a large Indian BPO company
22
WHAT ARE WE DOING ?
  • IN ORDER TO ADDRESS, THIS OPPORTUNITY, WE ARE
    HOLDING THE FIRSTEVER INVESTMENT CONFERENCE ON
    CALL CENTERS
  • THIS CONFERENCE IS IN KARACHI ON 29TH-30TH
    JANUARY 2005
  • LEADING SPEAKERS AND BUSINESS HOUSES FROM USA,
    UK, AUSTRALIA, MALAYSIA, SWEDEN, SOUTH AFRICA,
    HONG KONG, SINGAPORE INDIA ARE COMING TO SPEAK
    AND SHARE THEIR EXPERIENCES
  • CALL CENTER BUSINESS WILL BE OFFERED AND PLEDGED
    BY INTERNATIONAL COMPANIES TO PAKISTANI
    INVESTMENT COMMUNITY
  • JOINT VENTURES WILL BE OFFERED BY INDIAN CALL
    CENTERS ALREADY OVERLOADED WITH PROJECTS
  • GOVT OF PAKISTAN HAS ENDORSED THIS CONFERENCE
  • MINISTRY OF IT TELECOM, PAKISTAN SOFTWARE
    EXPORT BOARD (PSEB), BOARD OF
    INVESTMENT AND PASHA ARE THE PARTNERS

23
SOME OF THE COMPANIES ATTENDING AS SPEAKERS?
  • Nortel Networks A internationally renowned
    company on Call Center Telecom
    solutions-UK.
  • AOL Time Warner Operates a major call centers in
    INDIA
  • 3D Networks Call Center Integration solution
    providers-Singapore
  • Teleopti Work force Management system ( used
    worldwide)- Sweden
  • WNS Operators of 3000 seats at their call
    centers in India (British Airways, and 10
    other airlines) are operated through these
    call centers which are located at Pune,
    Mumbai, Nastiq as well as in Colombo,
    Srilanka.
  • Concerto Customer Relation Management Systems
    (CRM)- USA
  • DELL Computer terminals and network servers-USA
  • AstraNetcom A major call center operator from
    Dehli, INDIA
  • Khoday Systems A Major Call Center, INDIA
  • SEIBEL World renowned company in CRM
    solutions-USA
  • Davox Predictive Dialers USA
  • NovaTel Call Center Integrator, USA
  • Global Connect Business Out sourcing company
    USA
  • CinCom Call Center Business outsourcing company
    from Cincinnati-USA
  • PCW Formerly known as HONG KONG Telecom

24
SOME OF THE SPEAKERS
  • Carl Bildt Chairman, Teleopti Former Prime
    Minister of Sweden
  • Chris Luxford Chairman, 3D Networks, Australia.
  • Mark Stevens Asian Head, Nortel Networks,
    Singapore
  • S. K. Jha Country Manger 3DNetworks,India.
  • Atul Pai CTO, Khoday Systems, India
  • Rakesh Gupta Chairman, Astra Netcom, India
  • Romi Malhutra Managing Director, DELL India
  • David Tibble Head of WNS call center for
    British Airways and 10 major airlines of USA,
    India
  • David Smith CEO Global Connect USA.
  • Asish Paul CEO, CinCom, USA
  • Imran Aftab Global Outsourcing, AOL Time Warner,
    USA
  • Michael Parker COO, NovaTel, USA

25
THANK YOU
www.callcenter.net.pk
info_at_callcenter.net.pk
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