Regional ICT strategies for ICT Services
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1 Regional ICT strategies for ICT Services BY Mohamed AbdelWahab Executive Director Arab Business Forum for Information & Communication Technology ABFICT 1
2 Agenda Definitions: Outsourcing services ICT Services: A Global Opportunity Contact Centers in the Arab Region Regional Strategies to move forward 2 2
3 Definitions Outsourcing : Shifting or delegating a company's day to day operations or business processes to an external service provider; done in anticipation of better quality & lower rates. Offshore Outsourcing: is defined as the movement of a business process done at a company in one country to the same or another company in another, different country. Almost always work is moved due to a lower cost of operations in the new location. Nearshoring Inshoring Bestshoring Business Process Outsourcing (BPO): refers to outsourcing entire business functions, such as Finance, Customer Service, Accounting etc 3 3
4 BPO Industry Business Process Outsourcing includes the following areas and a lot more Back office operations Customer Relationship Management Benefits of BPO Call Centers and telemarketing Increase productivity Cut operational costs Tele-servicing and product support Provide better service Payroll maintenance Save costs Finance / Accounting/billing Improved accountability Human Resources Logistics Management Supply Chain Management IT outsourcing repesents 28% of outsourcing market. Medical transcription HR outsourcing 15% Back Office Operations Sales & marketing outsourcing 14% Insurance Claims Processing Legal database maintenance Financial services outsourcing 11%. The rest make up 32 % with admin outsourcing & like. 4 4
5 An Opportunity 2006 : BPO addressable global market is worth $ 122-$154 bn. Of which : bn retail banking bn insurance bn hospitality / travel bn auto 8-10 bn telecoms 8 bn pharma bn others bn finance, HR & accounting Revenue /Year Offshore BPO Revenue Total BPO Market Figures in $ million , , , , , , , : Mckinsey estimate that as of 8% of capacity was utilized. 2008: BPO market is forecast to hit $450 bn by , , , , ,070 Source: Gartner Dataquest 8 % 14% m1 5 5
6 Slide 5 m1 Nick Heath, 2008 mcit15, 04/06/2009
7 Customer service outsourcing US firms have saved nearly $8 billion through outsourcing to third world nations Most third world nations like Philippines and India have Contact Center benefited immensely from the call center outsourcing Outsourcing boom. Contact centers or call India leads the call center market with over 100 call centers are specialized outlets centers and more than 300,000 agents within an organization that Philippines which has more than 20 call centers and deal with the process of around 10,000 agents. placing & answering customer Countries like China, Mexico and Ireland are entering calls, answering customer the competition queries and contacting China starting to provide English language training to high existing & prospective school candidates in order to cash in on the lucrative call customers through , fax, center market. telephone or any other Malaysia and Indonesia are also stepping up efforts to communication devices. capture a share of the booming call center market. 6 6
8 Contact Centers Outsourcing Why Arab region? Population Languages Salaries/wages are relatively low when compared to qualifications Wide range of faculty graduates Arabic Unique English accent free French North Africa Other languages Telecom Infrastructure On major telecom routs between Europe & Far East Rapid development of regional networks Variation / Integration Time Zone Different Economical Standards Different Demographics Similar Cultures One Language 7 7
9 Contact Centers Outsourcing 30,430 Fully loaded operating costs per FTE (for a small delivery center) Overheads and others Real Estate Telecom Personnel 10,600 1,330 25,770 6, ,570 6,000 1,120 15,060 5,890 1,440 13,500 7, % Key sources of competitiveness Low personnel cost Superior telecom cost Competitive real estate cost US$/year 8 Czech Morocco Philippines India Egypt Republic With Incentives Source: McKinsey analysis 8
10 Contact Centers Outsourcing EGYPT Personal Large talent pool (~300,000 graduates per annum) Significant suitable and willing talent pool (~22,000 per annum) Multilingual & scalable environment (English, French, German, Spanish & Italian are spoken languages Commerce Education Arts Law Engineering g Scince & Tech Medicine 0 Other Faculty Gradutes Suitable & Willing English French German Other Source: McKinsey analysis 9 9
11 Contact Centers Outsourcing EGYPT Strategies: SUITABILITY ENHANCEMENT PROGRAMS Post 2011 University curriculum interventions Launch BPO elective as in Ci Cairo for 3000 students t along with course end certification Train the trainer program for 300 trainers Scale up BPO elective to cover most Ci Cairo faculties ( 5000 students t per semester) Launch pilot in 1-2 faculties outside Cairo Roll out train the trainer program outside Cairo Scale up BPO elective to students t per semester Launch of specialized domain programs (e.g., BFS, Insurance, Healthcare) Finishing schools Design & architect day finishing schools Train students inside Cairo Train 3000 students in Cairo and 1-2 other locations Train 20,000 students per year all over the country 10 10
12 Contact Centers Outsourcing EGYPT & MOROCCO Real Estate 11 Cairo Contact Center Park Size: ~ 75 Fadden 40 K seats ~100 K jobs created P.M. decreed the establishment of the Park in Maadi Scheduled to be fully operating 2013 CASASHORE Size: ~ 60 hectare ~250 K m2 of Office space & Facilities Site inaugurated by H.M. King Mohammed VI 1 st Phase: ~40 K m2 11
13 Contact Centers Outsourcing EGYPT & MOROCCO Telecom 12 12
14 Contact Centers Outsourcing Regional Strategies to move forward A regional fiber optics network Preferential rates for the call centers of the region Licensing VOIP / ITF, at least for the call centers industry Incorporating the different BPO programs in faculties and schools Setting a regional license for BPO employees with their specialty Regional awareness campaigns encouraging the youth to be engaged in the id industry 13 13
15 Thank You Mohamed AbdelWahab Executive Director Arab Business Forum for Information & Communication Technology ABFICT 14
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