【正文】 mpetition Management sophistication Reasons ? SOEs consider economics less and “management authority” more Prefer to build inhouse in order to increase management power and assets ? Call Center investment is less significant to large panies. Also, their agents? needs can justify a sizable inhouse operation ? Monopolized industry tends to be admindriven, or to disregard CC solution totally ? Poorly managed panies/industries see much less value of call centers to their business improvement SOE(1) Large Monopolized industry Poorly managed Privately owned foreign invested Smalltomedium Marketdriven, peting industry Well managed Less willing More willing (1) SOE = Stateowned enterprise Backup AGENDA Executive Summary Call Center Business ? Market Overview ? CC Customer Segmentation Inhouse users Outsourcers ? Demand ? Customer ? Economics ? Competition ? Remendations Success business model Partnering strategy ECommerce Market Overview TCI Tianjin ? Current Situation Analysis ? Remendations ADMINDRIVEN SEGMENT: MOST IMPORTANT FOR NOW High % in total new CC demand Driven by “Pillar industries” Demand surged in a group of China?s important industries since 1999, aiming to improve service level ? Bank ? Post service ? Fixedline tele ? Insurance Required mostly midtohigh end call center solutions (Nortel, Lucent, IBM, Huawei…) ? Big, monopolized, profitable corporations ? High cost of failure ? Budget approval from above ? Often in conjunction with structural reform 1998 1999 2023 of new CC seats (?000) Year Admindriven Total new demand Admindriven 66% 76% 62% Source: BCG modeling HOWEVER DEMAND EXPECTED TO FLUCTUATE IN THE FUTURE Underlying Reasons Admindriven segment orders e in batches ? Call center construction proposal often initiated by governmentcontrolled corporate headquarters, or even ministries ? Branch panies required to plete call center construction within similar period of time Admindriven corporations tend to overinvest ? Branch offices incentivized to use up the budget advised by headquarter However few admindriven industries are expected to invest in call centers for the following years ? Only two industries expected: utility and rail transportation 0 . 61 . 51 . 92 . 31 11998 1999 2023 2023 2023 2023 of new call center seats (?000) Year Banking example Source: BCG modeling。 BCG analysis MORE INDUSTRIES ARE LIKELY TO ADOPT CC OVERTIME CC Adoption Area Home appliance Automotive Computer Mobile Securities Retailing Petrochemical Distribution FMCG(1) Taxi Textile Machinery Chemical Publication Health care Government Entertainment Broadcasting/TV Aviation General Technology High Moderate Low Competition intensity High Horizontal will extend overtime Importance of service (1) Fastmoving consumer goods Source: Interviews。 CTI forum。 BCG analysis Horizontal will extend overtime Serviceoriented COMPANIES QUITE SELECTIVE ON CC USAGE Not blindly chasing after highend solutions Integrating call centers with its core business practice Interviews summary Source: Interviews % Investment per seat (?000 RMB) 54%31%15%O c t 7 0 7 0 1 5 0 1 5 0 2 5 0Interviews summary % Aftersales service 44%31%19%6%Order taking Information service Telemarketing 1070 Serviceoriented VERY CAUTIONS ON CC OUTSOURCING Price “ The price for outsourcing is too high now, for example, 95Info charges 15,000RMB/month (180,000RMB/year) per seat, most panies can not undertake it.” Sales Manager, SIEMENS Quality “ Chinese call center outsourcers have inadequate service mentality, we mostly worried about their service quality.” Hot Line Supervisor, EPSON China Human resources “ Ordinary outsourcer?s agents can only handle simple questions. It requires experienced engineers to deal with plex problems.” Hot Line Supervisor, EPSON China Confidentiality “ We once wanted to outsource management to 95Info, but sales data are secret to the pany, so we gave up the outsourcing option.” Call Center Vice Manager, Founder Computer Information processing “ Our call center is mainly used to provide crossdepartment information for management, outsourcing call center might make the information processing losing control.” Executive Officer Beijing, Guangdong Macro Major concerns about outsourcing Their outsourcing possibility highly depends on outsourcers? ability to satisfy their concerns Source: Interviews Serviceoriented GENERIC SERVICE: A GENERALLY DECLINING SEGMENT Consists Mainly of Paging Services Generic service Declining paging service segment... … Because of strong substitution of paging seats (?000) Year 50524020? Paging service market has been gradually eroded by widespread mobile and inter munication services fulfilled pager?s message function, but being either more economical (inter munication), or more versatile (mobile phone) paging customers will decline from 50 million in 1998 to 20 million in 2023 ? Smalltomedium, nonscaleable paging panies are being squeezed out of business of panies 1998 2023 2023 1736 2023 500 2023 200 Source: Interviews GENERIC SERVICE DEFINED AS A CROSS OF INDUSTRIES AND FUNCTIONS Generic service Functionality ? Message taking and delivering ? Simple order taking ? Standard telemarketing ? Standard customer question answering ? Standard valueadded i