【正文】 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。 CTI forum。 online research。 online research。 China Statistics Yearbook。 East TCITJ: RSTRUCTURING AND BUILDING STRATEGIC ALLIANCES TCITJ experienced difficulties due to both promotion and management issues ? Though improving, the firm is intrinsically unpetitive in China market It should restructure for better performance… ? Redefine corporate missions and strategies ? Restructure project arrangement, reporting, measurement and incentive systems ? Refocus its sales on Japanese panies in China and in Japan … and find strategic alliance for TCI?s China expansion ? TCI should only partner with prestigious local software pany or system integrators ? Wiseway screened all the potential candidates lists and funneled down 5 most promising panies for TCI?s further contact Longshine。 ? ISP: 263Net。 interviews Quality Service Style National monopoly ? Banking ? Tele ? Insurance ? Utilitity Regional protected ? Steel ? Auto ? Petrochemical ? Tobacco ? ... Monopolized industry estimated 55% of industrial output Higher tele peration COMMERCIAL CC TOOK OFF SINCE 1998 Especially in NonPaging Service Sector 1 . 0 % 2 . 5 %3 . 5 %6 . 1 %5 . 6 %8 . 8 %1 1 . 3 %1 4 . 5 %1997 1998 1999 2023Peration (%) Year CAGR 1022541998 1999 2023Fixed line Mobile 37% 83% Nonpaging CC seats (?000) Year CAGR = 129% Intensified petition 9192951241161081001996 1997 1998 1999? Most industries capacity over production ? Declining retail prices Year GDP index Retail price index Index Growing awareness of technology 2 . 491 9 . 84322181998 1999 2023Inter users (mio) ECommerce revenue (US$M) Gradually reduced tele fee Source: Jarding Fleming Research。 BCG analysis TELECOM IS THE MOST SIGNIFICANT CC USER NOW Bottomup Analysis Industry Tele Mobile Banking Insurance Post service Manufacturing Computer Airline Security Courier Home appliance TV selling Others Overall Projected seats CAGR 2023 25,000 7,667 4,545 2,000 1,600 1,501 800 594 257 240 240 300 6,675 51,419 2023 35,714 22,857 11,100 3,760 6,000 7,519 5,250 4,100 4,158 1,000 2,460 1,000 26,669 131,588 2023 41,667 50,000 47,000 9,850 20,833 25,184 14,000 9,600 32,600 3,333 8,800 2,000 71,965 336,832 202304 9% 31 % 25 % 17 % 39 % 50 % 60 % 62 % 101 % 43 % 79 % 35 % 41 % 26 % 202310 3% 14 % 27 % 17 % 23 % 22 % 18 % 15 % 41 % 22 % 24 % 12 % 18 % 17 % Source: interviews。 interviews, literature research Admindriven UNIQUE THREETIER DECISION MAKING PROCESS System Integrators Should Put Efforts to All Topdown initiatives Advocate improving service standard ? Make “service facilities” an evaluation criteria ? May suggest call center as an option Determine rolling out call centers in the corporation Raise a list of remended system integrators ? Present the list to branch panies Set a budget for different branch panies Decide call center size and sophistication based on corporate budget Negotiate and select a system integrator mostly suitable to the branch?s requirements SI should pay attention to Ministry?s recent service improvement incentive Ministry SI should approach promising corporate headquarters in advance to get the name on the list