Now Dalmias’ turn to set up call centers

NEW DELHI: After the Tatas, Munjals and the Jindals it is now the turn of the
$250 million Dalmia Group to eye the growing call center market pegged at Rs 850
crore by Nasscom. Gujarat Heavy Chemicals (GHCL), a flagship company of Dalmia
Brothers, has ventured into IT-enabled services by setting up a wholly-owned
subsidiary Icon Data Management (IDML) to promote offshore delivery of business
process and customer contact center.

GHCL plans to invest Rs 275 crore over the next three years in its call
center initiative that will have a seating capacity for 5, 000. The first phase
of the investment with Rs 15 crore will be made at its unit in Noida. The next
phase of expansion will be carried out only if it experiences 75 per cent
capacity fulfillment. With 50 percent of its existing capacity full, IDML
expects the next phase of expansion within the next two months.

IDML chief executive officer Shyam Vishwanathan said "Usually there are
two main issues that need to be addressed for setting up a call center: funds
and marketing. We do not funding problems. But as far as marketing is concerned
we have adopted a three-pronged strategy."

The first strategy is to target intermediaries to get business. These are
medium-sized companies who are traditionally in the outsourcing business and
would give business to IDML. The second is to target niche consultants like iCRM
and the third is to take equity stakes in these niche consultants and the
medium-sized intermediary companies, he said.

IDML is already working closely with iCRM promoted by Dr Jagdish Seth and Dr
Atul Parvatiyar. iCRM advises clients on CRM practices and has clients like Coca
Cola, Siemens and Motorola . In fact the company is looking at acquiring a 30
per cent stake in iCRM within the next two months. IDML has also kept aside $5
million to acquire small and medium call center companies with 2,000-25,000
people.

IDML is very clear about its business strategy that it wants to provide the
entire spectrum of outsourced services. It will not work on an ad-hoc project
basis. It will explore only those business propositions that have the potential
to either move up or down the value chain with the client. In other words, IDML
is looking at a few long-term relationships with its clients instead of having
many short term contracts with numerous clients.

While the low-end of the service spectrum comprise mere data entry, the
highest end would pertain to providing advisory services. The idea here is to
deliver value through quality services to its clients and increase the entry
barrier to competitors particularly in China.

"We have a very short-term advantage of 4-5 years over China after which
we would see major consolidation taking place in the industry. It is during this
time that we have to build our value to our clients and increase the entry
barrier," said Vishwanathan.

GHCL, a joint venture between the Gujarat Industrial Investment Corp and the
Dalmias, is no stranger to the call center business. The firm has a significant
stake in DSS Mobile, a leading paging company in the country that operates
domestic call centers in India for General Motors, ESPN, Sony, and Thomas Cook
among others.

However, the firm is anticipating dearth in qualified agents to man the call
centers. "Picking people from other centers is a short-term approach. We
are therefore talking to top call center training schools in US to set up
training centers in major metros of the country. These schools would be the
major feeder into our centers." Ultimately, a consolidated industry effort
will be required to address the problem of qualified call center agents, he
added.