CONTACT CENTER BUSINESS: Reality Check

Reality #4: Indian companies have a long way to go.

Indian companies today offer only a handful of services. While most of the email/chat services are for first level tech support, a few of the professionally set up companies also handle general email/chat based queries from dotcom companies. In voice, it is invariably catalogue marketing and/or cold calls for basic information acquisition.

Typically, these, particularly the outbound voice calls, are considered the less critical services for a company that outsources. No wonder they fetch a price that is much lower. Remember, the differential may be much wider than one believes. For example, a US bank pays typically about $30-$35 an hour in the US for inbound account based queries. The same bank pays $18-$20 for outbound credit card marketing.

FAQs

How much business did the contact center industry in India do last year?
Rs 390 crore, according to Voice&Data estimates.
How many seats are live today?
By March 2001, the number of live seats was about 3800.
How many people work in Indian call centers?
Indian contact centers, according to our estimates, employ about 7500 people as CSRs.
What is the hourly rate that Indian contact centers charge?
It varies from as low as $5 per hour to $11 per hour for e-mail/web support and between $11 to $20 per hour for voice calls.
What is the salary of agents?
About Rs 12,000-Rs 15,000 is the CTC in Delhi and surrounding areas.
What kind of services do they offer?
While most have good technology infrastructure to offer all kinds of services, today most provide technical support, e-mail based customer support and direct marketing through telephone.
Who are the clients?
Mostly technology companies, dotcoms and a few financial services companies outsource their work to India. Major names include Microsoft, Compaq, Amazon, and a few US based contact centers like Stream, Digital Impact and PRC.
How do they recruit?
Most companies recruit through multiple means, but primarily through newspaper advertisements in local papers.
What are the major challenges of Indian contact centers today?
Quality connectivity is the major cause of worry for most contact centers. In future, availability of people will emerge as another critical issue.
Which are the big Indian companies who have announced their foray into this business?
Tatas, India’s No 1 diversified business house, is setting up a contact center in a JV with Sitel. Two other group companies TISCO and TCS (a division of Tata Sons), are also being set-up. Among others are steel major Jindal, bulding majors Hiranandani and Ansals and shoe major Phoenix. Others who have announced are Flex Industries, HDFC and Adani Exports.
Does it make sense to enter this business right now or is it too late?
It is never too late. However, you should be 100 percent clear about why you want to enter this business and why do you think you will succeed.
Which is the best place to start a call center?
There is no clear-cut answer to that. Mumbai and Delhi (including Gurgaon and Noida) are the hot destinations. Mumbai scores in terms of cost and quality of connectivity, infrastructure and professional approach to work. In Delhi, real estate is cheaper and commuting is better because of better roads.
Which are the other places?
Bangalore, Chennai and Hyderabad are also emerging. So is Ahmedabad. Pune is another potential location.
What is the minimum cost of setting up?
It depends on what you want to offer. An e-mail contact center will cost you about Rs 8 crore. A voice call center will require an investment of Rs 12 crore or so.
Does it make better sense to open a voice call center or an e-mail support center?
Again, no straight answer to that question. But if you are starting from scratch, at this point of time, e-mail based contact center looks better as the RoI is faster, it is easier to manage and cost of set up is low.
Do I have to take a license?
Yes. You can get all the details and guidelines at www.dotindia.com
Is there an association of call centers in India?
There are quite a few. But none of them fully represents the entire industry.

Despite the fact that India is a preferred destination, Indian companies have not been able to build that confidence. "It will take time, but will happen" says the CEO of a Mumbai based contact centre company. Logical, it is. Correct or not, time will tell. With more US contact center companies setting up facility here, they may well walk away with the prized contracts.

Because, despite rising volumes, the real outsourers like the banks and telecom companies are yet to decide in favour of outsourcing to India. There are two worries. One is the capability of Indian companies. The other is the question of trust. Both are equally important.

In terms of technology enablement too, Indian companies have a long way to go. While many CRM companies today boast of serving through both voice as well as web channels, a closer look shows that what they have common in terms of infrastructure is buildings/space. Most of them have separate technology infrastructure for the two. Real integrated contact centres with all channels fully blended and facilities like co-browsing is hardly existent. However, quite a few professional companies like Daksh and Transworks are deploying such infrastructure in their new facilities.

The other area where Indian companies have miles to go is quality. Quality is not an issue today for Indian contact centres, though most of them pay lip service. Out of the 50 odd contact centres in India, only three (24/7 Customer, vCustomer and Transworks) have applied for COPC certification. And only 24/7 has ISO 9002 certification.

Reality #5: What is good in the long run, may be difficult in short run and vice versa.