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Business World, New Delhi

 
Theme - Parties are on
9th December, 2002.


Call centre debutantes like Spectramind, Daksh and EXL have all grown up. (Yes! We are crowing again. We are compulsive. These were the start-ups we featured in one of our covers very early on.) Many of them are now big boys (or girls?). Their ability is a given – and there is a price war on. Spectramind apparently won the $10-million a year (according to market rumours) Delta Airlines contract solely on the price factor. A computer manufacturer that outsourced tech support also gave business to a second supplier with a 20% price drop in just one year. Now the computer maker is scaling up its own support centre in Bangalore rapidly. In just a year it has grown to become 2,000-people strong. Anyone who wants business from it now, will have to compete with the in-house centre on costs.

There is commoditisation. Getting customers is no longer a problem. They walk in themselves. It is now an execution game – employ the best technology, get global scale and operate at the lowest cost.

Sanjeev Aggarwal of Daksh would still argue that it is possible to differentiate even in a market such as this. Even here, consultative customer support can fetch a bigger price. “For example, if a call centre agent is talking to the customer of a telecom company on which plan he has to be on and putting him on to the right one, and activating his connection. It’s very high value add compared to telemarketing.” Aggarwal’s company has 800 people serving just one telecom customer and does everything from putting customers on to plans and billing to provisioning a new service. Including Daksh, the telecom giant has 19 such centres across the globe.

But ask him if there is a place for the late walk-in and the answer is: “No, They have to find a niche.” This party is no longer open to the rookies, but the global big boys, save Convergys and European company 7C, are yet show up. They can still find space to salsa. This party is what the market calls a “horizontal play.” They will take any calls or make any calls.

The theme parties, however, are just about beginning. The third party business process outfits in India are all very small, like the 300-strong India Life Hewitt. Even big boys like Spectramind are doing very little of that. The biggest so far in WNS with 3,000 people, It was spun off by British Airways and funded by Warburg Pincus. But that is exception. Most of the back office work that is happening now is an captive centres of large companies like Axa Insurance and Standard Chartered Bank.

But in the queue are several players.

According to Pijush Sinha of Avendus Advisors, the four things you need to enter in this business are domain or process knowledge, customer access, market reputation and capital base. The last three is what several large Indian companies like Vysya Bank and IT services have, and want to trend on. NIIT, Cognizant Technology Solution, Patni, Datamatics and even the tech brahmin Hughes software, have all announced plans.

The global IT biggies, which have all four aplenty are coming in early this time. IBM, EDS and CSC are putting up business process outsourcing centres here.

However, domain expertise is in short supply. In short, you need to know the customer’s business. There are a few companies like Kale Consultant who know the airlines reservations business already because it built that technology in the first place. But most players like India Life Hewitt started small, built templates and are now ready to scale up. But since this game is gathering speed, you need to learn the tricks first.

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