IT/BPO Market Expansion & Investment Promotion

Perspectives and Experiences by Dr. P.K.Mukherji

October 2010

Page 1

Background

Background Current State of Bangladesh Industry Investment Promotion Roadmap Conclusion & Summary

Page 2

Industry Promotion requires complete appreciation of the opportunity by the various stakeholders. It requires a wholistic and integrated approach with a focussed marketing strategy It is also imperative to have consensus between various bodies, associations and government on the opportunity and way forward In addition, patience and perseverance of various stakeholders over a extended period of time is required to achieve the desired results.

Page 3

Global IT and BPO outsourcing markets have been growing at a healthy rate

Worldwide Technology Related Spends

Global Sourcing Market and Potential

Worldwide BPO Spends Worldwide IT Services Spends

Source: NASSCOM

IT and BPO offshoring will continue to grow at a significantly high rate in the next 5 years
Page 4

.. As a result, the offshoring landscape is an increasingly complex web of service providers and global service delivery locations Per our analysis, more than 80 countries are actively trying to position themselves as destinations of choice in the Global Outsourcing Arena ..
India Philippines Russia China Ireland Israel Eastern Europe Latin America

Key Evaluation Factors Regulatory Environment & Incentives Education Talent Pool Culture Geopolitical risks Industry Best Practice deployment Local marketplace
Mexico Canada

Regulatory Environment Labor Pool Education Cost Advantage Quality Programs Experience Cultural Compatibility Language Proficiency Infrastructure

Baltic Republics
Overall Climate

Russia

Ireland

Hungary Chez Republic Israel

China Korea

Bermuda

India

Vietnam Philippines Malaysia

Costa Rica Singapore Brazil

Mauritius South Africa

Argentina

Page 5

 This pushes countries to pursue unique competitive strategies to attract IT and BPO business

Country
Open economy environment State of art infrastructure

Attributes

Focus
Shared Services Disaster Recovery Bilingual Help Desk French &English Contact Centers BPO Services Animation Technology companies in Mining , sustainable energy and biotechnology Research and PG Institutes In mining and energy sectors

Mauritius

Convenient time zone Bilingual workforce Concentrated government push to promote the industry Large English speaking population with affinity to US culture Emphasis on Skill and talent development initiatives Botswana Innovation Hub offers high quality premises, telecommunications, business support and business development services to its tenants as well as support to entrepreneurs to develop and compete in the global market. Objective is to create an innovative and synergetic, growth and development oriented community with a drive for new business Plans to launch Kenya Transparency and Communication Infrastructure Project (KTCIP) to be implemented by the Kenya ICT Board.The overall objective of the KTCIP is to create an enabling legal, regulatory, connectivity and transparency environment which will lead to broader access to ICTs and better service delivery in the country. Focus on education. Evolved as a good financial hub Large multilingual workforce. Low labor cost Strong governmental support. Set up Smart Village a 600 acre ICT Park Large domestic market Proximity to Europe and Middle East Economic powerhouse in Africa. Good Infrastructure High R&D spend. Good Industry- Academia relationship Large domestic market

Philippines

Botswana

Kenya

English language call centre for UK and US Data entry activities

Egypt

MNC Captive Centers with domestic market as carrot Islamic accounting services

South Africa

Attract MNC captive centers Transaction BPO

Page 6

A number of countries and trade bodies are actively working to promote IT-BPO industry

Government of Ghanas Ministry of Communications (MOC) is working to promote the IT Enabled Services (ITES) sector in the country. The multi-year engagement is part of a World Bank funded initiative to support economic growth in the region. Working closely with the MOC and Ghanas burgeoning private-sector to develop and implement strategies to grow and enhance Ghanas ITES industry. ITES Secretariat, Ministry of Communications, Ghana Supporting ITES Secretariat in marketing, branding and investment promotion activities including organizing inbound and outbound investment promotion events

ECDC is the official economic development and investment agency for the Eastern Cape province of South Africa. ECDC is wholly-owned by the Eastern Cape Government. Conducted review of the current South African BPO strategies in terms of sustainable marketing, enhancement of competitive advantages as well as a leveraging of investment opportunities. Eastern Cape Development Corporation, South Africa Performed broad review of the BPO&O sector in the Eastern Cape in terms of its ability to significantly contribute towards GDP as well as its ability to create direct and indirect employment opportunities. Formulated a clearly identifiable Positioning Strategy and Value Proposition for the Provincial BPO sector

Page 7

Leading countries and trade bodies have worked with external advisors to develop the IT-BPO industry
Provided guidance in Strategy, Policy and Incentives for development of the BPO industry Helped bring a Fortune 50 client to Manila Advised on organizing industry forums which could facilitate IT/BPO industry Advised the Secretary of Trade and Industry of the Government of the Philippines Advised various nodal agencies in the IT sector on creating global visibility and increasing competency of Chinese IT industry Developed evolving Go-to-Market strategy, particularly to address US and European markets (IT/BPO) Identified sectors to leverage Telecom, Manufacturing Advised on partnerships with Indian firms to help Chinese IT Industry Advisor to IT secretary in developing IT/ITeS Policy Charting out roadmap for implementation of IT/ITeS policy Conducted road show for Karnataka Government in key client markets in Japan, US and UK Put together a long term vision and plan in place to make Karnataka as a preferred destination from infrastructure and security perspective Brought many prestigious fortune 100 clients to Karnataka state Ongoing advice in enhancing Karnatakas positioning in the IT/ITeS sector and supporting greater traction with client organizations. Advising in defining network and infrastructure required for setting up IT/ITeS industry Revised STPIs customer facing marketing programs Assisting with interactions between visiting customers and STPI Joint participation in various events
Page 8

Government of Philippines

Government of China

Govt. of Karnataka, India

Software Technology Parks of India

India has gone through a long journey to reach success and has had significant milestones

1958 1968

Indian Statistical Institute Kolkata gets India's first computer Ural, from Russia TCS established. Back then, it was known as Tata Computer Centre and provided computer services to the Tata group companies. Establishment of companies such as HCL, Wipro, Infosys and NIIT IBM asked to leave India, under Foreign Exchange Regulation Act Indian government announced the New Computer Policy NASSCOM is set up as the apex body for the IT-BPO sector in India India announces New Economic Policy New Telecom Policy announced; allows Foreign Direct Investment in telecom Creation of Telecom Regulatory Authority of India Government ends monopoly of VSNL. India opens up Internet sector to private Internet service providers. Infosys becomes first Indian company to be listed on NASDAQ VSNL sold to Tatas; voice over IP is legalized; international long distance market is deregulated India's software exports cross US$40 billion mark

1976-1981 1978 1984 1988 1991 1994 1997 1998 1999 2002 2008

other developing nations can learn a lot based on Indian experience

Page 9

Based on intervention in last two decades, Indian economy has transformed itself based on strong IT-BPO growth
100%

80%

63%
60%

The Indian economy has experienced rapid growth buoyed by a shift from an agriculture to a services-led economy BPO industry alone provides direct employment to close to 800,000 people IT/BPO Direct employment to reach nearly 2.2 million in 2009; indirect job creation estimated at ~8 million

40%

19%
20%

18%
0%

FY80

FY90
Industry

FY02

FY08
Services

Agriculture Source: Reserve Bank of India

(USD billion) Indian IT-BPO Sector: Revenue 60 Aggregate and Share of GDP

5.5% 5.2%

5.8%
47.3

6% 5% 4% 3%

50 40 30 20 10 0

4.6% 4.1% 3.6%

24.2 18.2 13.4 8.2 9.9 13.2 16.2 31.8

40.9

23.1

24.3

2% 1% 0% -1%

IT-BPO Sector has continued to grow in last 5 years contributing significantly to Indian GDP Steady growth of 16 17% expected in future with backdrop of economic downturn and larger base

FY2004

FY2005
Exports

FY2006

FY2007

FY2008

FY2009E

Domestic

Percentage of GDP
Page 10

Andhra Pradesh Shining Example in India

Strong leadership, participation and empowerment from Government Substantial investment in infrastructure and talent pool Created adequate built up space / infrastructure, through promotion of IT Parks/IT SEZs Developed Incubation Centres in Hyderabad and Tier II Locations for SMEs/first generation entrepreneurs. Attracting marquee investors and then leveraging their story for marketing Attracted new companies while providing scope and opportunities for existing investors Investment Promotion Body was empowered to ensure speedy decision-making on behalf of the government Exports from Andhra Pradesh (Rs crores)

Page 11

Jaipur Emerging Tier II destination in India

Software exports grew at a CAGR of 32%, higher than the national average of 18%
~1.7x

IT- BPO Companies and Employees 1.2 times growth over past 2 years

Engineering Colleges in Jaipur

~7.1x

Graduates in Jaipur (in 000)

~14.1x

Over 400 institutions providing higher education with 77% literacy rate in the state 7 times growth in FDI between 2007 and 2009 and 1.7 times in export revenues 14 times growth in graduated between 2005 and 2009 Growing investment of the government in healthcare, capacity building, office space and transportation

Page 12

Current State of Bangladesh Industry

Background Current State of Bangladesh Industry Investment Promotion Roadmap Conclusion & Summary

Page 13

World Banks report outlines the key perceived Strengths and Weaknesses for Bangladeshs IT/ITES sector STRENGTHS
Abundant, young, trainable labor Among the lowest IT/ITES labor costs in comparison to India, China and Pakistan Apparently supportive government and active industry associations

WEAKNESSESS
Quantity, quality and relevance of skilled workforce is inadequate Weak and uncoordinated industry promotion despite a generally negative country image and lack of visibility as a potential IT/ITES destination Weak, unreliable and inconsistent infrastructure overall Poor business environment in terms of corruption, time to set up business, and recent security challenge No cohesive workforce development initiatives targeting youth or females

OPPORTUNITIES
Global financial crisis means companies are looking for places to cut additional costs, a possible opportunity for Bangladesh, with low labor costs, to enter the market IT Park-type activity to define a manageable space within which the larger issues of infrastructure, policy and image can be more successfully addressed

THREATS
Resource crunch as skilled labor is taken by other business sectors Declining number of enrollments in IT courses Insufficient English proficiency to capture ITES related business opportunities including call centers Lack of action in addressing infrastructure issues, policy and regulatory framework to improve business environment Potential for strikes (hartals) and shutdowns that could paralyze commercial activity
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IT Market in Bangladesh is in nascent stages but evolving

Total size of the IT market, excluding telecom, was estimated to be US$300 million (2006), with IT/ITES industry contributing 39% or US$117 mn. More than 400 IT/ITES companies are registered in Bangladesh and employ over 12,000 ICT professionals. Per my analysis of these, about 2000 professionals would be focused on exports The major export market is North America, including recent activity to EU countries and East Asian countries, especially to Japan About 100 companies export their products including Improsys and Southtech , and at least 30 of those companies are established through joint-venture with an overseas company or as an offshore development center (ODC) with 100 percent foreign capital. Export earnings from IT/ITES were USD 32.91 million in the fiscal year 2008-09 registering a growth of 33% after two years of contraction (likely due to a change in classification of IT/ITES revenue in the government). Export Volume Software and ITES and Average Growth Rate
2003 Export Value (US$ mn) Yearly Growth Rate Source: Bangladesh Bank 4.2 2004 7.19 71% 2005 12.68 76% 2006 27.01 113%

BASIS Members Growth

Scale of IT Market in Bangladesh (USD 300mn in Total)

2007 26.08 -3%

2008 24.82 -5%

2009 32.91 33%

Page 15

A number of bodies in Bangladesh are active in promoting the local industry

Ministry of Science and Information and Communication Technology (MOSICT) Established to harness the potential of the IT industry, channel government support for the growth of the industry, and work as the hub to spread IT around the country. Ministry of Commerce (MOC) Export Promotion Bureau (EPB): The goal of the organization is to promote export trade and improve plan and policies helpful to the private sector, including the demand-side of the ICT (including IT/ITES) industry Business Promotion Council (BPC): For export promotion and capacity building activities, and mandated to look after the supplyside of the ICT industry. The council had organized programming training, IT expositions and IT literary studies. Bangladesh Computer Council (BCC) Main objective is to ensure the effective application and expansion in the use of IT. As such the BCC has been formulating appropriate policies and implementing them since its inception. This includes the development of the hitech park in Gazipur. Board of Investment (BOI) Established to promote and facilitate investment in the private sector both from domestic and overseas sources, with a view to contributing to the socioeconomic development of Bangladesh. It is headed by the Prime Minister and is a part of the Prime Ministers Office. Bangladesh Association of Software and Information Services (BASIS) The national association for software and IT related services companies of Bangladesh. Formed in 1997, the association has been working on a vision of developing a vibrant local software and IT service industry in the country, increasing IT awareness in the society, and creating an enabling environment for the software and ITES industry The association currently has over 260 members, accounting for majority of the revenues generated by the software and IT Enabled Service (ITES) industry in the country. Bangladesh Computer Samity (BCS) The voice of ICT industry of Bangladesh and the national association of the ICT companies in Bangladesh. BCS was established in 1987 with eleven members. The ICT industries of Bangladesh comprises distributors, dealers, resellers of computer and allied products, locally assembled computer vendors, software developers and exporters, internet service providers, ICT based educational institutions and training houses, ICT embedded services providers etc. The total number of members stands 646 at present.

There is a strong need to build consensus and appoint a nodal agency to oversee and manage the efforts
Page 16

Investment Promotion Roadmap

Background Current State of Bangladesh Industry Investment Promotion Roadmap Conclusion & Summary

Page 17

Several key areas needs to be addressed before embarking on an effective Investment Promotion

Talent Availability

Sustained demographic advantage English and other language pool Significant investments in capacity building, training and skill development

Cost

Low cost structure People and Infrastructure Tax Incentives and Other fiscal benefits

Infrastructure

Reliable and efficient infrastructure including world class real estate, telecom, connectivity and power

Environment

Stable political regime and geopolitical environment Progressive free-market policy - Investor friendly policy formulation and initiatives Facilitation by the Industry and Trade Bodies Creation of a nodal agency to coordinate efforts Strong marketing and branding initiatives to promote the Industry

Industry Support

Bangladesh has undertaken initiative to build on its strengths to attain success in the emerging outsourcing sector
Page 18

Investment Promotion requires an integrated approach to market and position locations as destinations of choice

IT / BPO Market Assessment IT / BPO Market Expansion Branding & Positioning Capability Development Investment Management Training & Coaching

Help the Governments and/or trade bodies in assessing the suitability of their destinations as compared to other emerging/emerged destinations Help the Governments and/or trade bodies in developing a comprehensive strategy to make the country an attractive destination for Outsourcing Support in branding the countries outsourcing services offering so as to increase the level of positive perception in US and Europe and service provider geographies like India and China Assist service providers operating in country, to enhance their capability, helping them develop a Go to Market Strategy and introduce them to prospective clients

Support the M&A and Private Equity activities of investors having an interest in investing in the country.

Support Governments and/or trade bodies with ongoing research, training and coaching to keep them abreast of latest developments

Page 19

Market Assessment

Investment Promotion Roadmap Market Assessment Branding & Positioning Business Linkage Events Capability Development

Page 20

Market Assessment & Benchmarking requires a comprehensive framework to assess National Competitiveness

Industry Inputs

Demand Conditions

Public Infrastructure Physical Facilities Telecommunications Workforce University System Professional Education

Enabling Systems

Tier 1&2 Service Provider Growth Projections High Demand Niche Areas Investor Value Proposition MNCs Economic Environment ICT Industry Associations

ICT Policy Infrastructure Policy Data Privacy Legislation Antitrust Policy Tax & Incentive Policy

Niche Areas Regional Marketshare Number of Agents ICT Industry Growth

Competitive Differentiation Global Marketshare Geographic Benchmarking Local/Regional Competition

Public Policy

Competition

Page 21

It is imperative to adopt a framework which helps evaluate, benchmark and review various government policies and incentives

Business Development Policies and incentives geared providing leverage and cross marketing opportunities in a public/private partnership between government bodies and an investing entity within a given target market.

Tax Abatement, Refunds and Credits Policies and incentives geared at reduction or offset of an investing entitys tax exposure within a given target market.

Business Development

Tax Abatement, Refunds and Credits

Legislative and Regulatory Policies

Legislative and Regulatory policies that may impact the outsourcing and processing of data within certain regulated sectors such as Financial services, Legal, Healthcare, etc. and the business environment in general (i.e., foreign ownership right, intellectual property rights, cyber laws, etc.).

Business Incubation Policies and incentives geared at addressing early stage business needs (i.e., low cost rental, sector clustering, etc.) to an investing entity within a given target market.

Business Incubation

Sourcing Industry Policy Rationalization (SIPRA) Model

Construction & Facilities

Construction and Facilities Policies and incentives geared at providing benefit or cost reduction in the area of an investing entitys physical facilities construction efforts (i.e., green facilities, etc.) within a given target market.

New Business Registration Policies and incentives geared at providing minimum friction on boarding, benefit or cost reduction of the activities associated with welcoming a new investing entity or their personnel to a given target market.

New Business Regulation

Industry Governance

Educational

Industry Governance Policies and incentives geared at enabling an investing entitys participation within industry groups tasked with direction and budget management directives for the regional outsourcing industry within a given target market.

Educational Policies and incentives geared at providing benefit or cost reduction in the area of an investing entity or the labor forces educational concerns (i.e., training grants and credits, university research, etc.) within a given target market.

Page 22

Government of Ghana outlined its Vision & Objectives for the multi-year eGhana initiative

MoC Vision

Improving the enabling environment for the use and adoption of ICTs for economic development Generating increased employment in the IT and IT-Enabled Services sector Enhancing efficiency, transparency, and accountability to facilitate good governance and improve access to information and services for Ghana citizens and businesses.

Market Promotion and Business Linkages

Engagement Objectives & Scope

Market Promotion: Comprehensive BPO/ITES market assessment, branding and market promotion to create additional 4,000 direct jobs in BPO segments over next three years Catalyze business linkage initiative to enable growth of Ghana's ITES/BPO industry.

Relationship Building & Ongoing Support to MOC

Relationship building with industry Assist MOC with cross cutting oversight Provide market intelligence

Page 23

A structured Engagement Approach helps achieve the desired results

An industry leading best practice based phased approach will yield desired results for investment promotion
APPROACH & METHODOLOGY PROJECT OBJECTIVES
Creates Direct & Indirect Jobs Creates Service Segment Expertise Supports Key Global Economies

Regional Competitiveness Framework

Validation Of Market Opportunities IT/ITES Industry Promotion & Business Linkage BPO Relationship Building & Management Global Market Intelligence & MoC Support

Regional Competitiveness Framework

BPO Market Expansion

Creates Industry Domain Expertise Creates Regional Hub Leadership Opportunity Attracts Global Investment

ITES Secretariat
Page 24

Periodic and measurable deliverables enable to keep the initiative focused

Market Assessment
Review Current State of ITES/BPO Industry Industry Analysis

Strategy Development
Recommendation for differentiating and positioning the country Governmental policy analysis - industry incentives, investments in education and infrastructure etc

Industry Promotion
Promotional Materials Preparation Business Linkages Trip Industry Promotion Events Initiative Support Tasks

Training & Coaching

Provide insights into the latest industry developments Provide insights to Investment trends in ITES/BPO sector International/nation al events/clients that afford a good opportunity to present IT and BPO Services Update ITES/BPO Investment Update Industry Report, Govt. Initiatives and Location Attractiveness Assessment Brand Visibility and Conference Updates

Activities

Deliverables

Industry Current State & Opportunities Presentation Executive Presentation on Current State, Future Opportunities & Success Factors

Strategic roadmap report with key recommendations and implementation plan (sample on next slide)

Presentations and marketing collaterals Industry promotion events (Out-bound delegations and Inbound summits)

Page 25

The objective of Phase I of the engagement was to create the basis for a strategy and roadmap to be executed over the course of the engagement

Interviews with Stakeholders

Advisory team incorporated the insights from the stakeholders interviews, and evaluated it against the global best practices for a clear assessment of country's current state and its capabilities

Review Current State Analyze Strengths & Weakness Identify Target Markets & Segments

Industry Inputs

Demand Conditions

Public Infrastructure Physical Facilities Telecommunications Workforce University System Professional Education

Enabling Systems

Tier 1&2 Service Provider Growth Projections High Demand Niche Areas Investor Value Proposition MNCs Economic Environment ICT Industry Associations

ICT Policy Infrastructure Policy Data Privacy Legislation Antitrust Policy Tax & Incentive Policy

Niche Areas Regional Marketshare Number of Agents ICT Industry Growth

Competitive Differentiation Global Marketshare Geographic Benchmarking Local/Regional Competition

Understand Success Factors Build Strategic Roadmap

Public Policy Competition

Refine evaluation, update recommen dations

Final Report

Kickoff October 12, 2009 Start 4 weeks End

Review and Analysis of Existing Reports and Studies

Extensive Data Collection

Industry Best Practices

Consultant Methodologies

Page 26

Intensive discussions, review and analysis led to the development of a comprehensive Strategic Roadmap for Ghana

Page 27

A number of factors need to be covered in developing a Strategic Roadmap Report

Strategic Roadmap Report Key Contents
What is the current state of BPO/ITES sector? What are the Current/Emerging Trends in Global Outsourcing? What are the current service offerings? Which are the target markets where there is opportunity for marketing countrys services? What are the size and growth trends in these markets? What are the gaps in countrys service offerings compared to market demand? What is the list of primary attributes that companies look for when deciding where to outsource operations or to locate an offshore facility? How do buyers perceive countrys efficacy as a service provider destination when compared to other geographies? What is the SWOT compared to other countries? How should the services be differentiated from other geographies? What needs to be done to strengthen positive perceptions of country as a destination for outsourced services? What should government do to increase its supply of skills for the industry? What should be done to improve its physical and telecom infrastructure required to support the industry? What should be done to improve the capability and maturity of the existing service providers to compete more effectively? What should be their process development plan? What type of legal and regulatory environment should be put in place to enhance buyer confidence? What type of government incentives should be provided to attract investments and grow the industry?

Page 28

Branding & Positioning

Investment Promotion Roadmap Market Assessment Branding & Positioning Business Linkage Events Capability Development

Page 29

A structured approach aids the development of a unique proposition for Brand enhancement & subsequent implementation

1. Existing Strategy Review & Analysis Strategy review (if required) Identification of Niche / Positioning Statement(s) Documentation review & Analysis Review of all current marketing collateral / marketing elements Study of in-process or contemplated marketing activities Strategy Formulation & Implementation Plan

2. Message & Promotional Material Development Developing messaging and marketing collateral for each of the targeted segments Brand refinement and leverage Target lists, communication plans, and distribution planning Event Identification & Planning Web Presence, Communication, Delivery, Research Reports Newsletters / Industry Reviews Media Planning

3. Ongoing Marketing, Branding & PR Targeting Potential Investors Partnerships and Associations Road-shows / Business Linkage Trips Ongoing PR activities Managing Media and Press Consistent Messaging across Media Measurement & Monitoring

Page 30

Strategic Review leads to identifying certain Target Market Segments for the location to be addressed in a phased approach ITES/BPO Market Segments Telecom, Banking , Insurance, Healthcare, Emerging (Oil & Gas and Mining) US & UK South Africa & Kenya Contact Centre, Data Entry/Transcription, F&A, LPO and Graphic Design India, China & Philippines
Regional Delivery Centres of IT-ITES Companies

ECOWAS
Telecom BackOffice and F&A BFSI Back-Office and F&A Contact Centre
Outbound & Inbound

Inbound Contact Centre Data Entry Services

FA OR CE UA SS

Transcription Services
(incl. Medical)

Telecom BackOffice BFSI Back-Office

LPO for UK Market

Shared Services Centres Graphic Designing F&A and Graphic Designing

Short Term Targets 0 to 18 months Medium Term Targets 18 to 36 months Long Term Targets 36 months and beyond
Page 31

Articulation of key Brand Elements is essential to uniquely position a location amongst the potential investors & influencers Consultant needs to work with Promotion Agency to clearly outline the branding and promotion themes
Innovative Approach: Country should be positioned for certain key target segments within ITES-BPO industry to build a unique value proposition Relationship Building: Building relationships with incumbents, potential investors and other Relationship supporting entities to build a positive image for its Building ITES-BPO sector. Service Excellence: Country should strive to build a strong service culture for the ITES-BPO sector with emphasis on continuous improvement Sector of the Future: Needs to create significant awareness around ITES-BPOs promising future and role for all stakeholders involved. Business Friendly: Country should be promoted as a business and investor friendly destination through best-in-class policies and supportive Government.

Innovative Approach Business Friendly

ITES-BPO BRAND

Sector of Future

Service Excellence

Page 32

During a Countrys Strategic Review, key areas and tasks for Development of Promotional Material should be outlined

Development of Promotional Material

The objective should be to develop promotional material tailored to the action plan for increasing awareness about countrys capabilities and value proposition in IT/ITES markets. Consultant should support creation of specific marketing collateral and relevant fact sheets including informational items designed to demonstrate value proposition of the countrys IT/ITES industry. The material should be developed for differentiating and positioning countrys IT/ITES sectors These promotional materials should be used selectively and distributed at key events worldwide, embassies, trade shows, relevant online and offline media among others

Review and Creation of Marketing Collateral

Consultant should review the existing collateral in detail and provided inputs to create additional marketing collateral in terms of brochures, flyers, presentations, CDs/ DVDs etc.

Review and support Website Creation

Consultant should work closely with Promotion Agency to review the existing website. It should provide recommendations and messaging material based on promotion strategy and benchmarking with other competing nations.

CRM System
Consultant should review the need for a CRM system, by understanding requirements and should make recommendations for suitable CRM applications for monitoring and managing the entire prospect lifecycle.

Key Tasks

Page 33

A number of promotional tools and channels should be used to communicate the marketing and branding messages

Promotional Events

Promotional events should be the cornerstone of investment promotion roadmap. A number of in-bound and out-bound events should be organized and participated in by countrys IT/ITES sector. Develop a website to act as the central repository of information and should continually add more information and data to make it a rich source of information for visitors. It is recommended to build targeted brochures, flyers and leaflets providing detailed information for promoting the IT/ITES sector. Such material should be used in the conferences, workshops and other such events.

Website

Brochures, Flyers, Leaflets

Other possible channels & tools include:

Industry Bodies Internet / Electronic Media Brand Ambassador / Face of the Industry Industry Publications and Surveys High Commissions Public Relations Research Content Industry Roundtables Local Media Non Resident Citizens High Commissions & Embassies of other countries MNC's expressing investment interest in other sectors for symbiotic marketing

Page 34

A number of locations are following distinct strategies for their marketing and promotion Egypt Example

EGYPT

Investment Package for Investors

Strong Infrastructure Development Strong Government Commitment along with Incentives and Support for ITES/BPO sector Scalable supply of highly educated skilled labor force and multi-lingual capability Small Time zone difference for European countries

Market positioning
Primary destinations for Middle East Market and Secondary destinations for Indian Service Providers Regional Software Development Center for MNCs (e.g. Intel, IBM, Microsoft) Call Center destinations for MNCs with multilingual clients (French, Spanish, German and etc

Targeted Geography Activities

Compiling a database of Egyptians working in the IT industry in the US, Canada and the Middle East Sponsor and attend events in the US, Canada and the Middle East to inform the Egyptian community (3-4 events yearly) Organize events in Egypt for the Egyptian IT community and investors abroad Develop an information rich web portal to draw audience

Promotion
Establish a National Coordination Body (ITIDA) Collaboration with India Partnership with external consulting and advisory firms

Page 35

A number of locations are following distinct strategies for their marketing and promotion Philippines Example

PHILIPPINES

Investment Package for Investors

Strong Infrastructure Development -Cyber Corridor 5 mature sites, 21 locations with existing ICT plans Strong Government Incentives and Support for the ITES/BPO sector One stop shop assistance for investors Highly educated skilled labor force and superior English language capability compared to other Asian countries

Market positioning
English Call Center destination for Western clients F & A, Data Processing and other non-voice based BPO for Western Clients High end KPO based on its large supply in Accountants, Animators, Electrical and Chemical Engineers

Targeted Geography Activities

Organize and subsidize outbound marketing and investment promotion event in the targeted markets Host International Outsourcing Event and Industry Affairs in Philippines Develop an information rich portal and leverage non-traditional channels for promotion

Promotion
Establish a National Coordination Body (BPAP) Collaboration with India Partnership with professional marketing firms for promotional activities

Page 36

A number of locations are following distinct strategies for their marketing and promotion South Africa Example

SOUTH AFRICA

Investment Package for Investors

Nation wide incentive program for ITES/BPO sector Develop a talent development program Develop programs to create and improve BPO standards Expand BPO destinations options in depressed areas Effort in reducing telecommunication and internet connectivity

Market positioning
Focus more on the value vs. cost Leverage its domain knowledge in key verticals such as financial services to offer back office support for MNCs Leverage its natural advantages in language, time-zone and cultural affinity to offer contact center services for MNCs Focus on niche market (e.g. F&A, LPO)

Targeted Geography Activities

Attend different outbound events in the targeted market Host international events in different South African destinations Developed a dynamic communication portal

Promotion
Create a National Coordination Body (BPeSA) Collaboration among Industry Associations, Government Agencies and Private companies Organize and support SA Service providers to conduct outbound marketing activities Partnership with other African countries
Page 37

Business Linkage Events

Investment Promotion Roadmap Market Assessment Branding & Positioning Business Linkage Events Capability Development

Page 38

Business Linkage Events (Inbound & Outbound Events) play a crucial role in branding, marketing and investment promotion

Several anticipated benefits are realized as a result of these trips:

Awareness & Brand Creation for ITES/BPO industry Create a positive mindshare / perception as a Business destination Attracting Potential Investors, Transnational Service Providers & Buyers Great forums for learning, networking & exchanging ideas with Buyer and Supplier Community, Analysts and Media Introduction and One-to-one meetings with decision makers of global IT/BPO firms in attendance Coordinating site visits to visit world-class delivery centers of several Global IT/BPO firms Developing closer relations with Tier 1 and Tier 2 global service provider firms Best Practice sharing through organizing road-shows and workshops

It is important to set aside adequate budgets for organizing and participating in the events
Page 39

Governments should follow a rigorous and iterative process to increase investment flow in the sector

Cycle 1
Typically to client geographies US, UK

Cycle 2
Client geographies US, UK, Europe & Inbound

Cycle 3
Service Provider Geographies & Inbound Summit

Investor Follow-Up Market Intelligence Review

IV I

Delegation Messaging & Communications

III

Delegation Messaging & Communications

III

Outbound Business Promotion

Outbound Business Promotion

Market Expansion
Promotional Strategy & Material

Inbound Business Text Promotion

Market Expansion

Outbound Business Text Promotion Inbound Business Promotion

IV

Market Expansion

IV

Delegation Messaging & Comm. Outbound Business Promotion

III

III

Refinement Delegation Messaging & Communications

II

IV

Ongoing Support Services

Consultant should work closely work with Government to develop a customized event calendar. Typically each event cycle should be 4 to 6 months with an inbound event following the outbound participation
Page 40

Organizing events requires careful and detailed planning

An external advisor and coach needs to work closely with the investment promotion agency to meticulously plan, organize events and conduct post visit activities. Some of the detailed tasks and activities include: Identification of appropriate events, topics and themes Selection of right participants and delegates Coaching of participants to align on common messaging Event sponsorships assistance Event speaker slot and track selection Development of promotional material Arranging One-to-One meetings prior to the event Information sharing with potential contacts prior to event Assisting in meetings and discussions Post event follow-ups including information dissemination, providing data, responding to questionnaires, assisting in further visits Assisting in conducting detailed due diligence, quality assessment

Page 41

A number of Outbound Events were identified for Investment Promotion for the target client

2010 Outsourcing World Summit (IAOP), Florida, USA

Event

NASSCOM BPO Strategy Summit

Outsource World, New York

Outsource World, London

Date

February 15-17, 2010

June, 2010

October 2010*

February, 2011*

IAOP Outsourcing World Summit is one of the longest running and highly acclaimed executive program on outsourcing.

One of the premier BPO events in the outsourcing calendar. It has high profile participation from leading BPOs & client executives.

Overview

Outsource World, New York is one of the premier events in US focusing on the outsourcing industry.

Outsource World, London is one of the premier events in UK focusing on the outsourcing industry.

Prepare budget for participation

Receive budget approval & sanction

Prepare speaker and visitor list

Key Tasks

Develop promotional materials

Provide participant briefing

* Tentative - Exact dates yet to be finalized

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Inbound events were used in conjunction with the outbound trips to showcase the country

Outsourcing Workshop # 1 Western Africa

Event

Inbound Event # 1 Investor Summit

Inbound Event # 2 Investor Summit

Inbound Event # 3 Investor Summit

Date

September, 2010

October, 2010*

May 2011*

August 2011*

Overview

Workshop for prospective clients in Western Africa region to create awareness of potential benefits of outsourcing

A targeted delegation from NASSCOM. The delegation comprises of 18 20 CIO, CTO & CXOs from leading Indian IT / ITeS companies

The event will invite specific IT/BPO outsourcing firms to visit country and include firms that have expressed a compelling desire to deploy operations in the region

The event will invite specific IT/BPO outsourcing firms to visit country and include firms that have expressed a compelling desire to deploy operations in the region

Prepare agenda and program outline

Prepare budget and receive approval

Develop promotional materials

Identify potential speakers & send invitations

Identify participants and send invitations

* Tentative - Exact dates yet to be finalized

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Key Tasks

Philippines has leveraged marketing events as the cornerstone of its investment promotion efforts...

BPAP has organized over a dozen outbound events in 2009 in key buyer geographies

# 1 2 3 4 5 6 7 8 9 10 11 12

Date February 11-12 March 3-8 March April May 4-6 July 27-28 July 29 July 30- 31 August October 12-23 November November

Event NASSCOM CEBIT Investment Mission Investment Mission Gartner Summit Investment Mission Networking Dinner World BPO Forum Summit Investment Mission Investment Mission NOA Summit Investment Mission

Location Mumbai Hannover, Germany Qatar, UAE, India Australia Las Vegas, USA Toronto, New York New York New Jersey Singapore New York, California, Florida London London

Event Type Trade Conference Trade Conference Investment Mission Investment Mission Trade Conference Investment Mission

Trade Conference Investment Mission Investment Mission Trade Conference Investment Mission
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Source: BPAP

South Africa has been very active in leveraging events to showcase itself and has participated in a number of events over the last couple of years

Event Participation by South Africa

# 1 2 3 4 5 6 7 8 9 10 11 Date 18 20 Feb 2008 2 4 Jun 2008 10 11 Jun 2008 10 11 Jul 2008 15 16 Oct 2008 11 13 Feb 2009 23 26 Feb 2009 2 3 Mar 2009 15 16 Jul 2009 September 2009 16 22 Nov 2009 Event IAOP Outsourcing World Summit Gartner Outsourcing and IT Services Summit NASSCOM ITES-BPO Summit SA BPO Policy Conference Outsource World Summit Nasscom Leadership Forum International Engineering and Technology Fair (IETF) Africa Outsourcing Summit Gartner 6th Annual Outsourcing Summit South African seminar on Legal and Knowledge Process Outsourcing International BPO Policy Conference Location Florida USA London Bangalore India South Africa New York India India London Sao Paulo New York South Africa

Sources: BPeSA, www.southafrica.info

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Mauritius has effectively organized In-bound events to attract key buyers

Board of Investment, Mauritius organized an invitation only Inbound Event in October 2009. Two key tracks Knowledge Sharing & Networking Series of in-depth knowledge sharing presentations delivered by independent industry specialist A number of case studies, shared by existing Mauritiusbased operators Presence of the Mauritian Government to provide perspective on the current and future role and prospects for outsourcing in the country Business Meetings One-to-one meetings bringing together potential suppliers and buyers of outsourcing services during the event 2 day event 2nd 3rd October 2009 held at Hilton Mauritius Resort Hosted by Mauritius Board of Investment 145+ delegates from 40 companies spanning 10 countries attended the event 250 pre arranged One to one meetings between service providers and buyers

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Capability Development

Investment Promotion Roadmap Market Assessment Branding & Positioning Business Linkage Events Capability Development

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Training & Development requires multiple initiatives with various stakeholders

Training & Coaching of Investment Promotion Agency

Capability Development of the Local Industry

Enabling Government with programs and inputs for Skills Development

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Ongoing Training & Coaching is crucial for success of investment promotion bodies and their efforts

Ongoing Training and Coaching helps bodies be better prepared for any changes in the worldwide ITES/BPO market by:

Having the latest information to better facilitate the adoption to the changed environment. Help to evolve and then adopt Best Practices prevalent in the segment and sustenance of a more visible Brand Keeping abreast of latest Market developments Proactively identifying potential Leads for investments Understanding & analysing Investment trends in ITES/BPO sector Policy initiatives launched by various governments at the national and subnational level targeting investments in the IT/ITES sector Market Scanning Identifying International/national events/clients that afford a good opportunity to present

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Key tasks in ongoing support include Relationship Building, Cross Cutting Oversight and Market Intelligence

Relationship Building
Put in place issue tracking and resolution process Organize Monthly Roundtable Meeting

Cross Cutting Oversight

Support Ministry/Government and Others Oversight Document of Potential Investors

Global Market Intelligence

Ongoing Research Of Industry Advise on Policy, Investments, Branding etc Status of Consultants Deliverables

Reporting and Follow-up

Reporting & Follow-up

Better Service Existing and New Investors

Support to Ministry and other Govt Departments

Ongoing Industry Research To Assess and Realign Strategies

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A number of regular updates and market research enables suitable policy intervention and course correction
Deliverable Frequency Objectives Key Outcomes Analyze the trend in the industry as a whole and the movement of work among offshore, nearshore and rightshore destinations and also the core focus areas for the government To identify and facilitate potential investments leads

IT and BPO Services Monthly Update

To better understand global scenario in terms of the flow of outsourcing deals To list the ITES/BPO deals and its movement To track the latest information in teams of investments by ITES/BPO companies and PE firms in the business at a global level To understand the investment trends in various BPO sub-segments and geographies To understand the changes in the ITES/BPO spaces at a global, regional and local level To study the various initiatives taken by different countries and regional governments for furthering the space in their respective countries/ regions To understand the change in country as a potential outsourcing destinations after executing the results of the study To list all the prominent ITES/BPO conferences around the world. Understand the scope of each of the conference and decide on a strategy to represent, if required Target all potential participants/ investors to organize in-depth discussions as required

ITES/BPO Investment Update

Quarterly

Industry Report, Govt. Initiatives and Location Attractiveness Assessment

Half Yearly

Strengthen the current state of the industry by adopting the latest and best suitable practices at the earliest state Steps to further Brand as a positive outsourcing destinations Creating Brand presence at global events and thereby attracting potential investors Have a multi-pronged strategy to push country as a viable destination against current market leaders and emerging destinations

Brand Visibility and Quarterly Conference Updates

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To support Service Provider capability development a comprehensive enabling program needs to be undertaken

Operational Excellence

Delivery Excellence Delivery Location Assessment Center Setup & Management Cost Optimization & Benchmarking Delivery Best Practices Infrastructure Optimization Workforce Management Health Check & Ops Assessment Captive Center Management Market/Service Expansion New Market Entry Sales Strategy formulation Competitive Positioning Market Risks Valuation Fund Raising Mergers & Acquisitions Divestiture

Process Excellence Certification Planning & Roadmap SEI/CMM Certifications ISO Certifications COPC Standards Six Sigma Compliance Services Training & Development

Go-to-Market Strategy

Opportunity Management Customer Trends New Growth Opportunities Pricing Strategy Contract Management Private Equity Investments Joint Venture/Build Operate Equity Partnerships Business Incubation

Investment Strategy

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SAMPLE PROGRAM AGENDA CORE Program Modules

Objective
1. The Marketplace of Outsourcing

Broad Coverage

Provide an introduction to The New Outsourcing Marketplace Familiarize with today's marketplace and key trends The outsourcing ecosystem play Understand emerging market business opportunities - key market trends

2. Effective Marketing Strategies

Analyzing and leveraging on internal strengths How do we ensure an effective Go-To Market Analyzing competition New arenas for differentiation/growth Make sure that you are in the right markets at right time

3. Supporting your Marketing Strategy

Explore strategies and techniques Understand effective tools / techniques to achieve your marketing objectives Using various channels for marketing and improving brand positioning

4. Driving your Sales Engine

Creating an Effective Sales function Improving sales conversion ratios Identifying various levers to differentiate Ensure that your efforts realize in client wins

5. Building and Maintaining Efficient Operations

Understanding the changing operational dynamics Importance of a location to delivery Measures/steps to reduce costs in operations
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SAMPLE PROGRAM AGENDA OPTIONAL Program Modules

Objective

Broad Coverage

6. HR: The Art of Attracting and Retaining Talent

Overcome challenges in HR that small and medium players face

HR Dynamics in the delivery engine Strategies and tools to efficiently operate the HR function

7. Strengthening Risk Management including aspects of Risk, Compliance & Security

Understand how external and internal threats can derail your business and reputation

Global best practices in Compliance and Security Mitigating foreseeable risks

8. Quality Focus: Taking your Delivery to Next Level

Achieving continuous improvements Best Practices in Quality Management in delivery and establishing a quality management engine Driving quality to satisfy client needs Using quality as an effective marketing tool

9. Creating a Robust Governance Structure

Ensure that you dont drop the ball in handling your clients and critical business issues

Minimizing frictions and maximizing relationships using governance Building Long Term Partnerships vs. Short Term Projects

10. Tools and Frameworks in Outsourcing

Steering outsourcing to a success

Various logistical tools and globally accepted frameworks in outsourcing Adopting the right process to ensure success from outsourcing

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A Comprehensive review of Skill Development is required to groom industry ready talent

Skill Assessment & Training Requirements

Training & Curriculum Development

Trainer Skill Development

Educational Institutions

Curriculum Sourcing

Trainer Profiling

Service Providers

Curriculum Creation

Training Execution

Government Incentives

Channel Development

Trainer, Facility & Student Certification

Determination of program objectives, drivers and constraints

Development of specific curriculum for all program stakeholders

Training deployment and development of certification standards

Industry based training program for the talent pool is fundamental to success
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Conclusion & Summary

Background Current State of Bangladesh Industry Investment Promotion Roadmap Conclusion & Summary

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Investment Promotion requires a long-term sustained effort to deliver desired results

Phase I Findings (Nov 2009)

IAOP Conference (Feb 2010)

NASSCOM BPO Summit, June 2010

Post development of promotional material, Consultant should engage in organizing business linkage trips and providing Ongoing Support
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Client countrys sustained and focused efforts have started yielding results within first 12 months

Immediate Job creation of 1500 people in next three months from single investor

Advanced level of discussions with clients and Service Providers for another 8000 jobs in 12 months

Positive mindshare within Tier 1 and 2 outsourcing firms, Global corporations, Analyst firms, Media and Industry associations

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Bangladesh should actively undertake steps to promote the ITBPO industry

Strong participation and leadership from the Government

Create and empower a nodal agency to coordinate efforts and ensure speedy decision making Develop flexible and agile Government structures, incentives and policies to cater to individual requirements of investors Invest in building infrastructure and enhancing skill base

Work with International experts and thought leaders to develop a unique differentiation for Bangladesh

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Identifying and working with a right advisor enables effective program delivery, coordination and monitoring

Should have a strong track record of helping similar clients with overall strategy, conducting business linkage trips and performing investment promotion services Deep relationships in buyer market such as US and UK and a strong presence in leading service provider geographies like India, China, Philippines Mexico and Latin America. Should have a strong client base such as National and State Governments, public sector organizations, Multinational Corporations, Trade Associations and Government Entities. Experienced advisors with significant experience in Outsourcing and worked with C Level Executives in Global 1000 organizations. Multi-cultural team with extensive international consulting expertise and exposure Proven methodologies, tools and frameworks to deliver its services along with strong research and Market Intelligence Capabilities Recognized by industry and credible market publications.
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To summarize, Bangladesh should leverage learning's from past experience of other nations

It is very essential that there is one single body for overseeing and coordinating investment promotion reason for success of India, Philippines and Egypt Need to leverage and review all relevant work conducted in the past to develop a well defined market promotion strategy which identifies the key target markets and services Undertake a strong intervention to improve physical infrastructure and operating environment through favorable policies and incentives Strong emphasis on highlighting crucial branding elements through development of high quality promotional material including website and brochures etc. Identification of potential events, relevant themes, finalizing budgets, ensuring participation, and finally contact and lead management Ongoing programs and coaching to various stakeholders through structured workshops and sessions

We believe that if all activities are undertaken in a diligent fashion with guidance from external advisors, Bangladesh has the potential to generate up to 30,000 jobs in next 5 years and reach $500 million in export revenue in the next 5 years.
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Thank You

Contact:
Dr. Pradeep Mukherji
Consultant +91-98210-80841 +1-646-403-9743 pkm@vsnl.com

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