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Introduction

Competitive Strategies of Daksh and Wipro Spectramind Submitted by: Jagmohan Singh Chawla (PG040067) Section D Jayant Dhankhar (PG040069) Section D Raja Banerjee (PG040133) Section D Indian School of Business, Hyderabad July 16, 2004 TABLE OF CONTENTS EXECUTIVE SUMMARY 3 INDIAN BPO INDUSTRY ANALYSIS 4 INDIA'S ADVANTAGE 5 Indian BPO industry SWOT analysis 5 PORTER'S FIVE FORCES ANALYSIS FOR THE INDIAN BPO INDUSTRY 5 Barriers to Entry 5 Competition within industry 6 Threat of substitutes 6 Buyer Power 7 Supplier Power 7 DAKSH - A LEADING BPO PLAYER 7 Daksh's Capabilities 8 People 8 Platform 9 Processes 9 Performance 9 Project Management 9 Core Competencies of Daksh (Call Processing) 10 Competitive Advantages of Daksh 10 100% BPO Focus 10 Unique Co-sourcing Model 10 Dedicated Business Units 10 Financial Strength 10 Strong Platform 10 Experience 11 WIPRO SPECTRAMIND - LEADING FROM THE FRONT 11 Wipro Spectramind's Capabilities 11 People 12 Infrastructure 13 THREATS & CHALLENGES TO BPO INDUSTRY 13 Attrition 13 Commoditization - No differentiation 14 US Backlash 14 ACQUISITIONS 14 ROAD AHEAD - SCALING UP THE VALUE CHAIN 15 FUTURE STRATEGIES 17 Daksh 17 Wipro Spectramind 17 ACRONYMS 18 EXHIBITS 19 Exhibit 1 19 BPO Market in India 19 Exhibit 2 19 Comparative Costs between India and the US 19 Exhibit 3 20 Typical time frame for setting up an ITES-BPO firm in India 20 Exhibit 4 20 Ranking of BPO Players 20 Exhibit 5 21 Revenue Growth of Daksh 21 Exhibit 6 21 The 5P Model 21 Exhibit 7 22 Co-Sourcing Model 22 Exhibit 8 22 Wipro's Transition toolkit (Service Delivery model) 22 Exhibit 9 23 Wipro's quality framework 23 Exhibit 10 23 Employee Satisfaction Ratings 23 REFERENCES 24 Executive Summary This document gives an overview of the Business Process Outsourcing industry of India. Two companies, Daksh and Wipro Spectramind are analyzed, and their future strategies explored. By 2006, world BPO market is estimated to be US$ 1.2 trillion, out of which India's share is expected to be US$12 billion. ...read more.

Middle

Performance Daksh consistently outperformed SLAs on productivity, quality and schedule. They had a proper tracking mechanism using a dashboard to track metrics. Daksh had documented business continuity plan. "It has been the smoothest rollout of any vendor outsourcing program", remarked a Director of a global vendor management giant. Project Management Daksh has a TPM Center of Excellence. They excel in seamless transition of work from onsite to offshore. They also have a TPM Toolkit to ensure successful implementation and meeting of deadlines. Their project management team has relevant experience and skills for transitioning and ongoing operations. Core Competencies of Daksh (Call Processing) Inbound Outbound Transaction Processing Customer Care Collections Technical Support Payroll Processing Product Support Cross-sell & Up-sell Collections Telemarketing Feedback Surveys Customer Resolution Welcome Calls Data Conversion Services Research & Analysis Order Fulfillment & Logistics Management Claims Processing and Adjudication Account Maintenance Application Processing Competitive Advantages of Daksh 100% BPO Focus Daksh has core competency in servicing clients and is focused on BPO services unlike many other companies that provide this service as an addition to their core business. Unique Co-sourcing Model Daksh uses dedicated work areas and people and uses cultural integration to service clients, thus ensuring a seamless extension of the client's organization. (Exhibit 7) Dedicated Business Units Daksh has organized itself into domain-based business units. These units comprise of people who have related experience and understand the client's business. Financial Strength Daksh is the only BPO player in India that has been profitable since inception. This outstanding track record has also ensured investments and they are well capitalized and backed by strong investors. Strong Platform Daksh is structured for growth and has exceptional experience in handling scalability and flexibility Experience Daksh pioneered the BPO business in India, and has a good understanding of the business. It has successfully serviced major Fortune 500 customers, and is well placed to move up the value chain. Wipro Spectramind - leading from the front Wipro Spectramind was founded by Raman Roy in March 2000. ...read more.

Conclusion

It should focus on services-led growth in the IT market in India and aggressively build awareness of the Wipro brand name. It can also pursue selective acquisition of IT companies. Acronyms BITS: Birla Institute of Technology and Science BPO: Business Process Outsourcing CEO: Chief Executive Officer FDI: Foreign Direct Investment IP: Intellectual Property ISO: International Organization for Standardization ITES: Information Technology Enabled Services MBA: Masters of Business Administration MCA: Masters of Computer Application NASSCOM: National Association of Software and Services Companies PCMM: People Capability Maturity Model SBU: Strategic Business Unit SEI-CMM: Software Engineering Institute - Capability Maturity Model SLA: Service Level Agreement SWOT: Strengths, Weaknesses, Opportunities, Threats TPM : Transitioning and Project Management Exhibits Exhibit 1 BPO Market in India Source: Nasscom-McKinsey KPMG 2003, BRICs Report 2003, Industry Data Exhibit 2 Comparative Costs between India and the US US$ Cost per FTE (Full Time Employee) United States India India as % of US costs Personnel 42,927 6,179 14% G&A Expense 8,571 1,000 12% Telecom 1,500 2,328 155% Property Rentals 2,600 847 33% Depreciation 3,000 1,500 50% TOTAL EXPENSES 58,598 11,854 20% Source: Industry Sources, Merill Lynch 2003 (From the Nasscom Strategic Review 2003) Exhibit 3 Typical time frame for setting up an ITES-BPO firm in India Exhibit 4 Ranking of BPO Players Source: Nasscom Ranking of Call Center & BPO players Ranking 2002-03 2003-04 1 Wipro Spectramind WNS Group 2 WNS Group Wipro Spectramind 3 Daksh e-services Daksh e-services Pvt Ltd 4 ExlService (I) Pvt Ltd Convergys India Services Ltd 5 HCL Technologies BPO Services HCL Technologies BPO Services Ltd 6 Convergys Zenta Technologies 7 GTL Ltd ICICI OneSource Ltd 8 MsourcE India Mphasis BPO Services 9 Hinduja TMT EXL Services 10 ICICI OneSource Tracmail Group 11 Sutherland Technologies GTL Ltd 12 Epicenter Technologies vCustomer 13 Zenta Technologies Hinduja TMT Ltd 14 24/7 Customer 24/7 Customer 15 Datamatics Technologies Sutherland Technologies Exhibit 5 Revenue Growth of Daksh Source: Daksh Exhibit 6 The 5P Model Source: www.daksh.com Exhibit 7 Co-Sourcing Model Source: Daksh Exhibit 8 Wipro's Transition toolkit (Service Delivery model) Source: www.wipro.com Exhibit 9 Wipro's quality framework Source: www.wipro. ...read more.

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