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29 TH – 30 TH JANUARY 2005 - KARACHI SHERATON

Presents. INTERNATIONAL CONFERENCE "CALL CENTER INVESTMENT OPPORTUNITIES". 29 TH – 30 TH JANUARY 2005 - KARACHI SHERATON. Supported by.

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29 TH – 30 TH JANUARY 2005 - KARACHI SHERATON

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  1. Presents INTERNATIONAL CONFERENCE "CALL CENTER INVESTMENT OPPORTUNITIES" 29TH – 30TH JANUARY 2005 - KARACHI SHERATON Supported by

  2. THIS CONFERENCE BRINGS AN INVESTMENT OPPORTUNITY FOR PAKISTANFOR 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 INDIA’S 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 •OfficeTiger25 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 India’s • PTCL’s mindset and negative attitude towards any change in policies

  19. PAKISTAN’S 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. PAKISTAN’S 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. PAKISTAN’S 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 FROMUSA, UK, AUSTRALIA, MALAYSIA, SWEDEN, SOUTH AFRICA, HONG KONG, SINGAPORE & INDIAARE 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@callcenter.net.pk

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