A project report on competitive intelligence for manthan services bangalore

COMPETITIVE INTELLIGENCE FOR MANTHAN SERVICES
BANGALORE
Babasabpatilfreepptmba.com Page 1
EXECUTIVE SUMMARY
We no longer live in a stable and predictable economic climate, competition is the
norm and things happen at a rate faster than before.
Organizations will survive and thrive only if they become flexible and able to
respond quickly and appropriately, not only to changing circumstances but also by
proactively meeting the challenge to compete. Managers and staff will need to be trained
to see competition as a challenge and opportunity rather than a threat.
Having talked about competition, one would quite certainly look to the
comparison with competitors as a tool to bring about the winning strategy.
Objectives and scope of the project
This project is intended to study and develop and also to understand the way of
performing COMPETITIVE INTELLIGENCE
A module for Competing intelligently is thus proposed.
To make these study possible samples of 20 BPO Companies for CI on Manthan
Services, Bangalore and 8 numbers of institutes forming the major competitors have been
interviewed.
From the primary & secondary research we have come to know in future health &
pharma sector and engg graphics sector is having the potential so we will suggest
Manthan services to expand their services in this sectors with cost efficiency, good
quality services with additional features.

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Chapter 1
INTRODUCTION
Today's competitive and quickly moving markets require executives to carefully
consider available alternatives before making a decision. This is especially true for
decisions with long-term impact, which are often referred to as strategic decisions.
COMPETITIVE ANALYSIS
A Competitive Analysis is a program for gathering and analyzing information
about your competitors, their strengths and weaknesses.
Business intelligence [an alternate term for competitive intelligence] is the
activity of monitoring the environment external to the firm for information that is
relevant for the decision-making process of the company.
Organization means how marketing, sales force, distribution channels,
advertisement, are used for the customer benefit.
COMPETITIVE INTELLIGENCE DEFINITIONS
The discipline of collecting and analyzing competitive information to create
actions to benefit your company. This business technique can be applied by large or small
business.
Strategic intelligence is concerned mainly with competitor analysis or gaining an
understanding of a competitor's future goals, current strategy, assumptions held about
itself and the industry, and capabilities -- diagnostic components. Intelligence about the
firm's major customers, suppliers and partners (in marketing or research and development
alliances) is often also of strategic value.
Some common goals of competitive intelligence:
o Detecting competitive threats
o Eliminating or lessening surprises
o Enhancing competitive advantage by lessening reaction time

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o Finding new opportunities
The objective of competitor intelligence is not to steal a competitor‘s trade
secrets or other proprietary property, but rather to gather in a systematic, overt (i.e., legal)
manner a wide range of information that when collated and analyzed provides a fuller
understanding of a competitor firm's structure, culture, behavior, capabilities and
weaknesses.
Today's competitive and quickly moving markets require executives to carefully
consider available alternatives before making a decision. This is especially true for
decisions with long-term impact, which are often referred to as strategic decisions.
There are two main strategies for firms to maintain their profits at a higher level
than the rest of the industry.
 A firm could try to outperform its competitors, for example, providing
cost- or product differentiation advantages to its customers.
 The second approach is to find an industry segment where these forces are
less severe.
COMPETITIVE INTELLIGENCE PROCESS
The Competitive Intelligence (CI) process transforms disaggregated competitor
data into relevant, accurate and usable strategic knowledge about competitor's position,
performance, capabilities and intentions. The primary objective of CI is to provide users
and decision-makers with useful and actionable information to make informed decisions.
The basic operations in conducting CI are illustrated below and described briefly in the
following sections.

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1. Planning and Direction Phase
The planning and direction phase is a cooperative activity whereby intelligence
users and CI professionals define management's actual intelligence needs. To facilitate
this activity, key topics are used to create an interactive and efficient dialog with the
company's key decision-makers. The better management can articulate their needs, the
more likely they will receive intelligence they can use.
2. Collection and Compilation Phase
Internal: Frequently, the best intelligence is located right in your own organization.
Sales/Marketing staff could
have information on:
 Sales practices
 Distribution channels
 Training programs
 Compensation methods
 Product differentiation
 Pricing practices and
trends
 Promotion mix
 Market and customer
base
Operations staff could
have information on:
 Nature of
processes
 Production
facilities
 Employee mix
 Cost trends
 Productivity
 Capacity
utilization
Accounting/Financial staff
could have information on:
 Historical performance
 Financial projections
 Comparative key
indicators

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Engineering staff could have
information on:
 Technological leadership
 Product development
 Patents
 Production process
Human Resource staff
could have information
on:
 Organization
 Mgmt Devel.
 Recruiting
 Training
 Unionization
Several methods to obtain
information internally:
 Develop an internal
network
 Create ―who knows
who‖ list
 Develop a call list
 Encourage
swaps/exchanges
 Provide value-added
feedback
External Resources: Information can be collected from a wide variety of sources. The
following is a partial list of external sources for data collection:
 Suppliers
 Customers
 Industry Analysts/Experts
 Competitors
 Internet
 Web Sites
 Databases
 Scanning (Magazines, trade journals, etc.)
 Exhibitions and trade associations
 Government sources (embassies, government agencies, etc.)
3. Analysis & Production Phase
Information without interpretation is most often useless. Quantifiable information
is the easier part of the analysis process because it usually entails comparing data such as
revenues, market share, product performance, features and benefits, employee turnover,
etc. The real art is to interpret non-quantifiable data and provide an intelligence product
that is actionable.

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The production phase is the activity related to preparing the information in a
format that is easy-to-use and actionable. Formats and tools vary from company-to-
company, but the following simple steps can be applied to facilitate use and appreciation
of the information:
 Identify the essential elements of information
 Use bullet-point format
 Use graphs and charts to compare quantifiable data
 State conclusions and recommendations
 Produce new bulletins and competitor profiles
4. Dissemination Phase
CI information, such as News Bulletins and Company Profiles, should be stored
in a company-wide database (intranet-based) so that all employees have access to basic,
publicly-obtainable information on competitors, team partners and suppliers in a concise
format.
Intelligence reports, however, should be closely held since they provide
comparative data, tactical strategies or recommendations which are company sensitive.
This information should remain in the hands of decision-makers such as senior
management, product lines managers or marketing managers. CI information can be
diluted as required in the event of a proposal exercise so that volume managers can
ensure that key tactical issues (strengths and weaknesses, technical performance, product
features and benefits) are addressed, directly or indirectly, in the proposal response.
Ask any business manager how they define Competitive Intelligence (CI) and
you'll hear responses ranging from, "that spy stuff" to "industrial espionage" to
"systematic collection and analysis of competitor information", from those slightly better
informed. But, CI has priorities that range a lot more broadly than understanding
competitor behavior; although that's a key part - its influence and usefulness shows up in
many firms in other areas more traditionally served by existing "silos" of functionality
that sometimes take offense at CI playing in their sandbox.

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Minimizing Threats
CI has always concentrated its attention on minimizing threats to current business
activities, or status quo, of the firm and has done so through encouraging a better
understanding of the shorter-term operational initiatives the firm might take to dominate
the markets in which the company competes in the present tense, relative to its
competitors for that same total-available-market. This focus has allowed many companies
to build very effective CI operations with the mission of remaining aware and responsive
to competitive threats as they arise on the market landscape. This rather reactionary
perspective remains CI's primary objective - although often, simply to be aware of
current activities in a marketplace, are discounted and derided by more "proactive"
thinkers within the firm. By contrast, I would argue that this is the minimum that must be
done to craft an effective competitive strategy in the short-term.
Maximizing Opportunities
The most common area in which new CI functions disappoint its internal
customers is that of maximizing new business opportunities for the firm. While many
managers fail to accept CI's role in helping the company to select new markets for
existing offerings, fresh revenue streams, or other opportunities for the firm to grow
value for shareholders, this is a vital lesson for CI teams to understand: their value will
best be judged on the basis of contributing to the net profitability of the enterprise at
large... or their net cost to the enterprise in defending (or recommending abandonment) of
existing (and sometimes less important) markets that may already have matured or are
plagued by price commoditization. It is far more important in this respect for the CI
function to help the firm find new markets for existing or adapted products and services
(even if those products and services have very little to do with what the company does
today) in order to move the organization towards its most profitable potential direction
while avoiding costly and sometimes ruinous mistakes in strategic direction made by
decision makers higher-up.

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COMPETITIVE GUIDELINES
Developing your higher-level competitor capabilities begins with awareness of
key Competitive Guidelines and the tools, techniques and approaches that give them
vitality. The following are a few of the Guidelines that provide a roadmap on how to
create your competitive success.
Competitive Guideline #1
Companies don't compete ... people compete.
Be sure that you are knowledgeable about the person who makes the decisions in your
competitor's camp. There is a technique for helping with this: Shadowing.
Knowing what your competitors have done is good ... predicting what they will do
and acting upon it is great.
Many successful competitors find that Gaming helps to develop their skills in this critical
area.
Competitive intelligence is important ... actionable competitive intelligence will
impact your bottom line.
What is the difference between a nice to know fact and critical intelligence that drives
action in your business worth? Proactive Discovery Networks go beyond reporting
yesterday's competitive news.
If your competitive intelligence is driving an important decision make sure you use
multiple sources.
How embarrassing to commit significant resources, time and funds to an action to learn
you've been "played" by your competitor. There is a technique to help with this:
Triangulation.

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Streamline the intelligence gathering process or become a victim of information
overload and analysis paralysis.
In recent years Competitive Intelligence Technologies have introduced dozens of new
products and services that reduce the amount of time and money spent gathering
competitive data and information.
THE TOP 12 PRIORITIES FOR COMPETITIVE INTELLIGENCE
1. Current Competitor Activities & Strategy Monitoring - The standard "meat"
of the CI program, it's important to remember that, above all, customers expect
the CI team to be aware and helpful in understanding competitors' current
activities and plans. Usual sources for this kind of research come from public
announcements (Web, news, PR, etc.) and follow-up interviews conducted
against the competitor to ascertain their commitment to current initiatives. This
is standard, old-school "competitor intelligence", the constant striving towards
knowing how to successfully transfer marketshare from the competitor's
company to one's own.
2. Customer & Vendor Monitoring - Threats of backwards- and forwards-
integration by customers and vendors is a possibility often discounted, but a fact
most often realized, by firms every day - even described as two of the drivers of
competitive strategy within the classic (Michael) Porter's Five Forces Model -
these threats are known as "latent competitors", or those which could relatively
easily move back and forth in the value chain to exclude the firm as a preferred
source in the open market. As customers and vendors move up and down the
value-added-ladder, healthy profits at different stages within the value chain
create sometimes-irresistible opportunities for such traditional allies to move
quickly into a "cannibalization" mode against the firm. Likewise, an
understanding of customer-share, or "wallet", can be revealing in terms of
unexploited opportunities to sell more products/services within existing
customer relationships thereby minimizing selling and marketing costs, while

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maximizing impact within a customer's value chain, and excluding competitors
from those self-same opportunities.
3. Operational / Performance Benchmarking - Benchmarking initiatives are
traditionally conducted against direct competitors, but can also prove beneficial
in studying latent competitors, "parallel competitors" (or, substitutes for your
products/services), as well as best-in-class or best-in-world firms that can easily
move into diversified businesses based on their core competence to take
advantage of market opportunities perceived by their own intelligence team.
Most often, such benchmarking studies begin by isolating the operational
deficiencies present in the firm, identifying practices at firms that excel in those
areas, then conducting research to determine why they excel and transfer that
knowledge to the firm to increase tactical efficiency. Sometimes a company can
catch-up to a competitor or develop their own differentia compared to other
supplier options that will create a level of market dominance based on
operational efficiency. This is especially true for those firms who cannot seem
to achieve cost-competitiveness but instead compete in spite of their selling
price, rather than because of it... with obvious implications for cash-flow and
financial solvency.
4. Strategic Probabilities & Possible Futures - The future is the battleground for
all business, and, as we try to predict that future, "scenario planning" has been a
tool used by many competitive strategists to understand the sum-total of all
possible futures and assign probabilistic likelihood to each of those possibilities
- thereby, gaining an understanding of what is likely to happen moving forward.
Closely tied to war-gaming, in that, business war games try to predict how
companies will make decisions and the comparative outcomes of those
decisions, across a number of financial quarters - where they will invest, what
markets they will attack, which ones they'll abandon, etc. - the most common
method of scenario planning is characterized by "decision-trees" or the
"implications-wheel" models that have been used to comprehensively and

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statistically weight all possible outcomes and then craft decisions based on the
least harmful or most helpful series of outcomes probabilistically predicted.
5. Product/Service Sales & Marketing Support - One of the highest-impact
areas that the intelligence team can assist in, a solid understanding of strengths
and weaknesses, not only of competitors but of the firm's own customer and
market perceptions, helping sales force win new customers or maximize share
of existing ones can be the make-or-break metric of success or failure. While
the ability to contribute recommendations to sales force for ensuring "FUD-
Factor" (fear, uncertainty and doubt) in the minds of customers about
competitors' products and services is important, it's also critical to understand
the marketing messages relayed to this customer-base by competitors that can
help the firm to mitigate threats to existing customers and win more profitable
revenues from new ones. This is closely related to value-chain, channel and
customer intelligence, but usually conducted anonymously in order to ensure
truthful discussion by customers and distributors of the relative perceptions of
their buying options.
6. Internal Knowledge Management - Knowledge management and its
connection with CI has often been talked about, but my own opinion on the
subject is that, CI presents what is perhaps the most solid business case for KM
initiatives the firm can get its arms around. Some 80-percent of what a company
needs to know about its market and competitors already exists within the firm
and, when directed towards a specific business problem or objective, KM can be
of great assistance to the CI team in exploiting these internal sources - in the
form of more tacit "communities of practice" as well as for customized search-
and-retrieve of subject-matter experts and identifying sources of explicit
documentation for market awareness.
7. Intellectual Property Exploitation/Protection - For companies like IBM (who
once provided a "free service" to the general public to search patent records,
which in reality was used to scan for companies interested in licensing its

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technologies), intellectual property (IP) has become a multi-billion-dollar
business. Likewise, as what might often become the cornerstone of a firm's core
competence and competitive differentia, IP can determine who wins and
ultimately loses the competitive battle in the hearts and minds of customers. In
certain markets, IP is the single greatest influencer of wins and losses -
pharmaceuticals, for example, are guaranteed a period of protected re-
capitalization on their investment in developing new drugs, and defer the
problems faced later on, when these "cash cows" are overcome by generic copy-
cats. Lately, these forces have been lessened by shrewd manipulation of product
features as points-of-patent to perpetuate historic monopoly protection of secure
markets - from the design and form of the pill itself to the application
effectiveness timeframe, pharma companies are developing new ways to protect
and exploit old products.
8. M&A-Alliance-Investment Support - Buying, investing-in and allying with
companies that have something to offer - either in the form of marketing
channels or production capabilities, if not raw cash-in-hand - provide many
firms the engine of growth for their future expansion plans. However,
statistically speaking, most deals fail to produce the highly touted and endlessly
promised shareholder value they purport to deliver. This is most often due to a
lack of due-diligence in the qualification process - and a source of tremendous
validation value for the intelligence team. Recent efforts to include pre-deal due
diligence by intelligence teams have had substantial effects on post-deal success
- beginning with selection of candidates and ending with final consummation of
the deal and integration of enterprises.
9. Long-Term Market Prospects - Are you in the right business... today?
Tomorrow? That's what an understanding of long-term market prospects can
produce for the firm. Every business is locked into the devilish "product life
cycle" that includes not only the most profitable periods of product/service
lifespan, but also eventual decline and death. Most commonly directed towards

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understanding which markets will be fastest growing (a traditional market
research activity) and then making recommendations to decision-makers on the
means by which the firm can come to dominate those markets, a solid
understanding of core competence is also important here. A firm like Corning,
which began in the tableware business and came to dominate the fiber-optics
business, is such an example; likewise, a company like Enron, a giant in the
energy business, has transferred its core competence to the Internet and even the
steel-selling business (although, of course, there are more significant lessons
there...).
10. Counter-Intelligence & Information Security - CI is conducted by every
company, against all competitors, although I would qualify that by saying it is
most often an informal process, rather than one with an official staff and
specific mission. One really must assume that their organization is under the
scrutiny of one's rivals, at least periodically, and that, traditional (and some very
non-traditional) methods will be used to extract sensitive information from the
firm to enable the competitor to better succeed in the marketplace. While most
often deployed against "industrial espionage" activities, counter-intelligence is
often a very highly developed process - sometimes even designed specifically to
dis-inform one's competitors as to the firm's future plans. The legal and security
teams are most often considered the liaisons to counter-attack these specific
initiatives - despite the fact that legal and security tend to be better at
minimizing the impact of breaches after they've occurred rather than preventing
against such actions beforehand. The intelligence team has an important role to
play as a point of contact for these defenders of the firm's proprietary
information in that, CI personnel are best-suited to countervail the same
strategies they are actively engaged in with competitors. Likewise, former
employees, contractors, and other individuals privy to the nature of the firm's
proprietary information can be significant sources of CI for competitors.

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11. Legislative/Regulatory Impact on Business Issues - In certain industries,
more than others, government activities - in both legislative and regulatory
realms - can be disproportionately influential in enabling or hobbling a firm's
competitive strategy. Typically most influential in industries for the public
interest such as telecom, finance, energy, healthcare and transportation, this is
also important in understanding the implications of strategic initiatives such as
merger and acquisition approval - if a government or trade bloc denies approval
for a certain merger - as we saw happen with MCI/WorldCom and Sprint as
well as GE and Honeywell - the competitive benefits of the deal will certainly
be compromised. Likewise, if a certain drug or market strategy (witness the
recent energy-availability concerns in the USA) meets with regulatory scrutiny,
legal issues can and often do ensue, effectively scuttling the competitive
strategies of the market players involved. This activity is closely tied to strategic
futures as the key impact is uncertain, yet must still be planned for, despite the
relatively small likelihood of outcome.
12. Decision-Support & Consultative Briefings - The (admittedly) catch-all final
category, intelligence teams will be required to assist both tactical and strategic
decision-makers in becoming aware of all options available to them in each of
those decisions. The real value-add that most managers ask for when they request
better information is a really a more thorough understanding of the options
available to them - simply, so that they don't miss any options that they might not
have thought of on their own. These "trusted-advisor" missions are diverse and
require the most highly developed understanding of one's own intelligence
mission and resources - but also provide the greatest opportunity for the
intelligence team to make an impact on the company's long-term competitiveness.
Likewise, the penultimate objective of every intelligence function should be to
become this trusted advisor. and maintaining a competitive advantage.
COMPETITIVE ANALYSIS

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Business takes place in a highly competitive, volatile environment, so it is
important to understand the competition. Questions like these can help:
1. Who are your five nearest direct competitors?
2. Who are your indirect competitors?
3. Is their business growing, steady, or declining?
4. What can you learn from their operations or from their advertising?
5. What are their strengths and weaknesses?
6. How does their product or service differ from yours?
What to address in your competitor analysis?
 Names of competitors - List all of your current competitors and research any that
might enter the market during the next year.
 Summary of each competitor's products - This should include location, quality,
advertising, staff, distribution methods, promotional strategies, customer service,
etc.
 Competitors' strengths and weaknesses - List their strengths and weaknesses
from the customer's viewpoint. State how you will capitalize on their weaknesses
and meet the challenges represented by their strengths.
 Competitors' strategies and objectives - This information might be easily
obtained by getting a copy of their annual report. It might take analysis of many
information sources to understand competitors' strategies and objectives.
 Strength of the market - Is the market for your product growing sufficiently so
there are enough customers for all market players?
Ideas for gathering competitive information
 Internet - The internet is a powerful tool for finding information on a variety of
topics.

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 Personal visits - If possible, visit your competitors' locations. Observe how
employees interact with customers. What do their premises look like? How are
their products displayed and priced?
 Talk to customers - Your sales staff is in regular contact with customers and
prospects, as is your competition. Learn what your customers and prospects are
saying about your competitors.
 Competitors' ads - Analyze competitors' ads to learn about their target audience,
market position, product features, and benefits, prices, etc.
 Speeches or presentations - Attend speeches or presentations made by
representatives of your competitors.
 Trade show displays - View your competitor's display from a potential
customer's point of view. What does their display say about the company?
Observing which specific trade shows or industry events competitors attend
provides information on their marketing strategy and target market.
 Written sources:
o General business publications
o Marketing and advertising publications
o Local newspapers and business journals
o Industry and trade association publications
o Industry research and surveys
o Computer databases (available at many public libraries)
COMPETITIVE ANALYSIS CONSISTS OF FOUR MAIN STEPS
1. Identification of your competition - competitive analysis experts will look
at your primary and secondary and indirect competitors as well as your
potential competitors so you will know who your customers can approach to
get a product or service that fills the same need as yours does.
2. Analyze strengths and weaknesses - Next our competitive analysis
experts will determine your competitors' strengths and weaknesses. You will

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know why customers buy from them - whether it is price, value, convenience
or some other factor.
3. Examine opportunities and threats - Our competitive analysis experts
will tell you how well your competitors are prepared to deal with outside
opportunities and threats such as technological developments, regulatory or
legal action, economic factors, or even a possible new competitor.
4. Determine your company's position in the marketplace - Finally, our
competitive analysis experts will tell you how your company compares to the
competition. This will give you a better understanding of what you do well
and what you need to do better.
THE CYCLE OF COMPETITIVE INTELLIGENCE
The CIA describes the intelligence cycle as "the process by which raw
information is acquired, gathered, transmitted, evaluated, analyzed and made available as
finished intelligence for policymakers to use in decision-making and action." There are
five steps which constitute this cycle:
 planning and direction
 collection and research
 processing and storage
 analysis and production
 dissemination and delivery
―Failure to frequently analyze your competition can cause your organization to
target the wrong customers, incorrectly price your products, launch a product that does
not fill a specific need or waste time and monies on ineffective marketing campaigns. By
effectively analyzing your competition, you will always stay one step ahead. ‖
What is Competitive Analysis?

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Competitive analysis is a program for gathering and analyzing information about
your competitors’ activities and general business trends to further your own company’s
goals.
Why do you need Competitive Analysis?
 Your pace of business is rapidly changing
 You are overloaded with information from many sources
 There is increased global competition from new competitors
 The existing competition is becoming more creative
 Industry technology is always changing
How will Competitive Analysis help your company?
It can help you:
 Foresee changes in the marketplace
 Anticipate the actions of your competitors
 Discover new or potential customers
 Learn from the successes and failures of others
 Increase the number and quality of mergers and acquisitions
 Learn about new technologies, products and processes that affect your business
 Enter new lines of business
Why don’t all companies use Competitive Analysis?
 Managers feel they already know everything there is to know about their market
 Companies think that there is nothing of any importance occurring outside their own
organization
 Many feel that it is considered spying or unethical
 It‘s not taught in business school, therefore it must not be vital

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 Senior management considers it a cost center, not a profit center and too expensive
to implement
 Mistakenly many feel that the results are too hard to measure
INDUSTRY ANALYSIS - THE FIVE FORCES APPROACH
Companies are always concerned about the influence of market forces on their
profits. A rather simple method of predicting the likely profitability of an industry has
been introduced by M. Porter (1980). He describes five forces that affect the profits of an
industry.
Internal Rivalry
The term internal rivalry refers to competition for market shares in an industry and is
therefore, closely related to the other four forces as will be clear later. This relationship is
depicted in Figure, where the central role of internal rivalry is represented accordingly.
The outcomes can be twofold. On one hand, prices are driven towards the cost margin,
and on the other hand - in the non-price dimension - fixed costs are driven up, for
example by requirements for research and development expenditures, etc. However, it
seems that the competition in the price dimension has generally more potential to erode
profits. There are certain conditions that heat up price competition, those are:
o There are many sellers in the market.
o The products are perceived as being homogeneous by the customers.

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o The customer faces low switching costs for changing to a product from
a competing firm.
o The orders come generally in for big quantities, but rather
infrequently.
o There is excess capacity in that particular industry.
Entry
Reported high profits in an industry will automatically attract investors, who are willing
to enter that industry. Basically, new entrants will stimulate internal rivalry in their
struggle for expanding their market share and therefore, erode profits in that industry.
However, there might be conditions that serve as barriers to possible entrants.
(i) Economics of scale.
(ii) Limited access to essential channels of distribution.
(iii) Patents.
(iv) Need for establishing brand identity.
(v) Incumbents maintain excess capacities and threaten with slashing
prices.
Substitutes
Internal rivalry is also higher through the existence of substitutes, which are basically
different products, but they can serve the same purpose. To be effective as a substitute, it
must be sold in the same market. We will treat the definition of markets later on, but
sometimes the firm level price elasticity of demand is used for determining substitutes.
Supplier Power
A supplier has power, if he can negotiate prices in his favor and extract profits from its
customers. The opposite is the case in a perfectly competitive market, where the supplier
is assumed to be a price taker. Upstream suppliers will have the power to erode industry
profits under the following two conditions:
1. The industry is concentrated that means there are only a few sellers

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2. Customers are locked into long term relationships with their suppliers,
because of relationship specific investments, like a big corporate
computer network that has been installed by one vendor.
Buyer Power
Buyer power means, that the buyer is able to negotiate the price. Buyer power will be
higher, if the industry is more concentrated and the vendors are locked into relation
specific investments with their customers, similar to the conditions for supplier power. In
contrast, the willingness of customers to shop around is an important cause for internal
rivalry. This should not be mistaken with buyer power.
Even though the model is very appealing, it possesses certain limitations.
(i) The model does not account for the magnitude or the growth of demand.
(ii) The model focuses on an industry as a whole not on individual firms.
(iii) The industry and the markets must be well defined.
SAMPLE QUESTIONS FOR COMPETITIVE ANALYSIS STUDY
General Information and Benchmarking
 How do your competitors rate with their clients for future vision,
technology, industry knowledge, and functionality ?
 How well do your competitors meet implementation schedules?
 What reputation do your competitors have for customer service and
support?
 What are your competitors strongest and weakest points?
 How loyal are your competitors' clients?
Vendor Relationship
 How do you feel your current vendor is meeting your needs?
 In what areas are they not meeting your needs.
 How would you rate the vendor in the following areas:
 Service and Support?
 Implementation and installation?

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 People?
 Price?
 What are the vendor‘s strengths and weaknesses?
 Would you recommend the vendor to a third party?
 Would you consider changing vendors?
 What "business value" were you looking for from the vendor?
 What functionality is the product missing?
Short List Vendor Selection
 What criteria did you use to narrow the selection for your short list?
 Who is involved in deciding which products make the cut.
 What process do you use to rate each of the products on your short list?
Final Vendor Selection
 What aspects of the product, or segment of the sales process were most
important in determining which product to choose?
 What attributes does the product you chose lack?
 What factors contributed to you choosing the other products on your short
list?
SAMPLE RESEARCH APPROACH - COMPETITIVE INTELLIGENCE
ANALYSIS
1. Assess the structure of industry sector, competition in the areas of manufacturing
and trade.
2. Identify operating practices and market access mechanisms, including:
 Marketing strategy;
 Advertising and promotion;
 Pricing policy and mechanisms;
 Approach to NPD (New Product Development);
 Storage and transportation;

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 Trade channels (distribution, wholesale, retail, customers, end-users).
3. Analyze and present findings (text, charts, graphs, maps) according to the sample
structure below:
 Comparative cross-tab of pre-defined parameters, broken down by competitor.
 Trends in competitive developments (price, quality, financing and payment terms,
promotion, etc);
 Current status and operations of local manufacturers;
 Plans of local manufacturers (including reconstruction, investments, re-
structuring, privatization, etc); market access channels, marketing strategies,
business practices.
Market Structure and Competition
The structure of a market refers to the number and size of firms in it. Many
markets are dominated by a few large firms. Take for example, the market for soft drinks
and airframe manufacturing. Other markets have many sellers, such as the markets for
TV-sets and stationery.
In some markets the products are homogeneous (metals, chemicals), that means
sellers can meet the needs of customers equally well. In this case price will be a major
factor influencing the buying decision. Whereas, in markets with heterogeneous products
(PC, soft drinks) customers will have preferences for different sellers and price will be
less important.
Market Definition
George Stigler (1985) and Robert Sherwin have described a market as "that set of
suppliers and demanders whose trading establishes the price of a good." In other words
two sellers are in the same market, if one seller's pricing and production decision
materially affects the price that the other seller may charge. The economic literature
provides several concepts of defining markets. We shall attempt to detail these concepts,
which can be categorized as qualitative and quantitative approaches.
Perfect Competition

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A market with perfect competition is constituted by many sellers providing
homogeneous goods and well informed customers, who can shop around for the best
price without extra cost. The interaction between all sellers and all buyers will determine
a single price that clears the market. All companies face infinitely large elasticity of
demand. Since prices cannot be controlled, firms decide only about the amount of output
they want to produce and sell. In order to maximize profits, firms will choose their output
such, that marginal cost of production equals marginal revenue. The higher the number of
sellers in the market, the lower the market price will be and firms will make less profit.
Naturally firms could make higher profits, if they colluded in setting a higher price for
their products. Fortunately legal provisions in the USA and the European Union prohibit
such policies to protect customers.
Monopolistic Competition
Edward Chamberlin (1933) introduced the term monopolistic competition in order
to describe markets with two features:
 There are many sellers in the market. If only one lowers its price, no one
would follow, because there are just too many competitors to keep track
of.
 The sellers are differentiated and thus offer heterogeneous products. As a
result customers will choose on factors other than price alone.
Oligopoly
Now, we want to investigate the situation of a market that has only a few sellers.
In this case the theory predicts that the price and output decision by one firm will indeed
have influence on the overall price and output in this particular market.
Who are your competitors?
Starting simply is the best way! If you are working on behalf of an online retailer,
do not let your clients get away with comparing themselves to large online retail portals
or commerce centers like areas of Yahoo! and eBay - unless they are of that size and
stature.

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Focus on the level of products that are offered, and to whom the operation seeks
out as its customers (or targeted audience). Once you can define what the company is
about, and who they target - use the search engines to your advantage and help them
select their most poised online competitors.
Who is a competitor in business?
Business competitors are:
 Other organizations offering the same product or service now.
 Other organizations offering similar products or services now.
 Organizations that could offer the same or similar products or services in the
future.
 Organizations that could remove the need for a product or service.
Why monitor competitors?
By knowing our Competitors we may be able to predict their next moves,
exploit their weaknesses and undermine their strengths.
Collecting competitor information
 Sales representatives deal on a daily basis with customers - and will hear what the
competitors have been doing. They are the business foot soldiers - with the ear to
the ground who can forewarn management about impending enemy campaigns.
 Research & Development may come across new patents.
 Purchasing may find out that a supplier is now also supplying a competitor.
Market research can give feedback on the customer's perspective
Competitor profiling
Another common technique is to create detailed profiles on each of your major
competitors. These profiles give an in-depth description of the competitor's background,
finances, products, markets, facilities, personnel, and strategies. This involves:
 Background
o location of offices, plants, and online presences
o history - key personalities, dates, events, and trends
o ownership, corporate governance, and organizational structure

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 Financials
o P-E ratios, dividend policy, and profitability
o various financial ratios, liquidity, and cash flow
 Products
o products offered, depth and breadth of product line, and product portfolio
balance
o new products developed, new product success rate, and R&D strengths
o patents and licenses
o quality control conformance
o reverse engineering
 Marketing
o segments served, market shares, customer base, growth rate, and customer
loyalty
o promotional mix, promotional budgets, advertising themes, ad agency
used, and sales force success rate
o distribution channels used, exclusivity agreements, alliances, and
geographical coverage
o pricing, discounts, and allowances
 Facilities
o plant capacity, capacity utilization rate, age of plant, plant efficiency,
capital investment
o location, shipping logistics, and product mix by plant
 Personnel
o number of employees, key employees, and skill sets
o strength of management, and management style
o compensation, benefits, and employee morale
 Corporate and marketing strategies
o objectives, mission statement, growth plans, acquisitions, and divestitures
o marketing strategies

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Market Intelligence (MI) – Information relevant to a company‘s markets, gathered and
analyzed specifically for the purpose of accurate and confident decision making in
determining market opportunity, market penetration strategy, and new market
development metrics.
The Importance of Competitive Analysis
Why should competitive analysis be important to company?
Because a good competitive analysis will allow the company to identify its
competitors and evaluate their respective strengths and weaknesses.
For your business to succeed, you need to know almost as much about your
competitors as you do about your own company and customers - a competitive analysis
can provide you with this information.
Unfortunately, many small business owners make the mistake of waiting until a
competitor has opened up shop across the street and is cutting into profits to pursue a
competitive analysis and find out who and what they're up against.
From information to intelligence
All this information needs to be collated - with any links and commonalities
highlighted. The information will need to be indexed and catalogued - so that when new
information comes along, it can be quickly linked to similar information that had
previously been found. It may be stored in a custom-built or dedicated competitor
database accessible via the company Intranet - although it can also be stored in much less
sophisticated forms.
Finally, the relevance and importance of each piece of information needs to be
interpreted and analyzed - on its own and in conjunction with other information, the other
pieces in the jigsaw. This is where information starts to become intelligence.
What customer needs and preferences are you competing with?
The list may go on and on, but select those that are most prominently touted by
the competitors in both online and offline documents. Guarantees, price breaks, exclusive
offers, are all commonplace in order to help make visitors customers.

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Beyond that, the audience that is targeted may in fact have very specific demands
in order to be pleased as a client of any online operation. Research those needs, analyze
how the other online competitors of your client meet such needs - and recommend steps
in order to give your client the upper hand.
What are the similarities and differences between their products/services and
yours? While it may be good to offer the same products and services as others - it is also
critical within the online marketplace to obtain a distinct advantage over others.
How do their prices compare to yours?
If the product (or service) demand exists, competitive pricing could be the make-
or-break point for any online operation. If your client features a more extensive
inventory, with better shipping procedures and timeframes - but the pricing is noticeably
higher than others - expect that to be reflected once the traffic starts coming into the site.
How does your client plan to compete?
Search engine optimization will in fact generate more visitors to any online web
site, and if done properly, will gain a significant amount of continuous attention from the
targeted visitors of your client's market.
Once those targeted visitors begin coming in, make sure that your client has a
progressive (and aggressive) plan in place to better suit the demands of such users.
Simple things like FAQ's, automated support systems, and a knowledgeable sales staff
will make things flow much more smoothly.
Offer advice to your client as needed within this department. Often, those looking for
SEO are ready to establish a flat-lined level of sales or product support, but not one that is
scaleable over time.
SWOT: To make a good positioning, you have to realize a SWOT analysis:
It means strengths/weaknesses/opportunities/threats.
PESTEL: It means: Political factors, Economic factors, Social factors, Technological
factors, Environmental factors, Legal factors

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Factor Vector
Market research Income, tastes, resources and strengths of competing,
suppliers, work patterns, population clusters, price, elasticity‘s
Macroeconomics and
sector policies
Terms of access and trade, price policies, fiscal and monetary
policies, tariff and non tariff barriers
Natural resources and
human capital
Geological resources, labour, climate, experience
Physical, technical, and
social infrastructure
Transport, credit, market information, extension,
communications, marketing extension, post harvest facilities
Micro marketing
relationships
Quality control, efficiencies of management- buying, selling,
handling, production, marketing, promotion, credit
coordination, market research, risk analysis, relationship
building.
COMPETITIVE STRATEGY
Value chain analysis espouses three roles for marketing in a global competitive
strategy. The first relates to the configuration of marketing. It may be advantageous to
concentrate some marketing activities in one or a few countries. A second role relates to
the coordination of activities across countries to gain leverage say, of know how. A third
critical role of marketing is its role in tapping opportunities for upstream advantage in the
value chain. More will be said about value chain analysis in later chapters.
GENERIC COMPETITIVE ADVANTAGE
If there are few perceived differences between products and their uses are
widespread, then the lowest cost firms will get the advantage. This is the case of
television sets and many fruit products. If there is a large perceived difference created,
then the firm has more price leeway. CARMEL and OUTSPAN successfully created a
perceived quality advantage, as have Cadbury and Nestle. Focus strategies concentrate on
serving a particular segment better than anyone else. A good example of this is the Dutch
flower auction or Gerber baby foods.
STRATEGIES FOR SUCCESS
 Economies of scale - low cost of production.
 Customer knowledge - shifting the product mix to meet changing demand.

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 Technological innovation - vacuum packing policy, bulk transport.
 Infrastructural development - supermarkets, transport systems.
Examples of elements included in the export marketing mix
1. Product support
- Product sourcing
- Match existing products to markets - air, sea, rail, road, freight
- New products
- Product management
- Product testing
- Manufacturing specifications
- Labeling
- Packaging
- Production control
- Market information
2. Price support
- Establishment of prices
- Discounts
- Distribution and maintenance of pricelists
- Competitive information
- Training of agents/customers
3. Promotion/selling support
- Advertising
- Promotion
- literature
- Direct mail
- Exhibitions, trade shows
- Printing
- Selling (direct)
- Sales force

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- Agents commissions
- Sale or returns.
4. Inventory support
- Inventory management
- Warehousing
- Distribution
- Parts supply
- Credit authorization
5. Distribution support
- Funds provision
- Raising of capital
- Order processing
- Export preparation and documentation
- Freight forwarding
- Insurance
- Arbitration
6. Financial support
- Billing, collecting invoices
- Hire, rentals
- Planning, scheduling budget data
- Auditing Service support
- Market information/intelligence
- Quotes processing
- Technical aid assistance
- After sales
- Guarantees
- Warranties/claims
- Merchandising

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- Sales reports, catalogues literature
- Customer care
- Budgets
- Data processing systems
- Insurance
- Tax services
- Legal services
- Translation
7. Financial support
- Billing, collecting invoices
- Hire, rentals
- Planning, scheduling budget data
- Auditing
Who Does Competitive Intelligence?
Those working in CI range from public, legal or corporate librarians and
information center analysts to management personnel, specialists in financial data,
business-development people and strategic planners to ex-CIA operatives and retired
military intelligence personnel, information specialists and academicians. (One of the
authors of this book, John Moorhead, is a former U.S. Naval Intelligence Officer.) Many
corporate practitioners, according to a survey done by the Conference Board, are
marketing directors or marketing research managers. It seems that at this point in CI's
evolutionary progress, to quote Lawrence of Arabia, "nothing is written."
Competitive intelligence is the core of competitive strategy
Why do evidently great organizations with great products, wise managers, and
other successful strengths, go out of business?
Economies of scale, the foundation on which big companies have based their
dominance in the Industrial Era, is no longer an advantage. Changes in information

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technology, in the financial system, in just-in-time production techniques, and in the rise
of companies offering distribution and support systems which previously only the largest
companies could afford -- removing the advantages of being big. The diseconomies of
scale - overhead, inflexibility -- are becoming increasingly powerful.
Value of Competitive Intelligence
Here are just a few of the questions firms ask themselves when implementing a CI
program:
 How do we most usefully define the company's mission, its strategic intentions,
its objectives and its strategic choices?
 What do we need to know to develop and to select strategies which are not only
successful, but sustainable?
 What new products should we build and which markets should we enter and how?
 How do we implement our competitive strategy?
Competitive intelligence is usually composed of five major areas of endeavor, and is
performed under three main approaches in the CI framework:
 assessment of strategies
 competitor perceptions
 effectiveness of current operations
 competitor capabilities
 long-term market prospects
CI is focused on decision making
Seldom do people realize that business, just like life is merely a series of decisions. And
global firms have a growing need for the necessary information on which to base
decisions concerning the conduct and development of each of their firm's strategic
objectives, and the protection of their organizations against threats from their
competitors.
Purpose & Role of Intelligence in Business

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Intelligence is both, a process and a product -- an analytical process that
transforms tumultuously gathered competitor and market information into actionable
knowledge about competitors' capabilities, intentions, performance, and position; as well
as the final product of that process.
The focus of market research tends to be on the problems associated with the
profitable marketing of a firm's products and services. The scope of competitive
intelligence is far broader. Competitive intelligence is a value-added concept that layers
over the top of business development, market research and strategic planning.
The research objectives of a competitive intelligence project will often involve
issues such as: the manufacturing capabilities of the competitor; analysis of alliances
and/or joint ventures entered into by competitors; the competitor's future plans and
strategies for specific markets, or product lines; reasons behind changes in the corporate
or business unit strategy, et cetera.
Competitive Analysis & Testing
Do your customers know the difference?

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How do your products compare with others on the market? While companies
often make claims of superior performance, how many can back them up with objective,
quantifiable data?
THE AARDVARK STORY - A CASE STUDY
Aardvark had a problem, perhaps many problems. The market for widgets seemed
to be changing, revenue and premiums were under pressure in their key market segments.
New market entrants and Aardvark's main competitor were eroding market shares. New
business models fuelled by information and telco technology and movements in the
exchange rate also seemed to be complicating the picture. What was going on, what was
driving this turbulence? How would Aardvark respond? How could they improve their
competitive advantage?
MindShifts worked with Aardvark to define the key intelligence topics and refine
the key questions which would drive a situational analysis. Internal sources of
information, expertise and networks across the organisation were mined. At the same
time MindShifts carried out a targeted search for publicly available information which
would add input to the analysis. We also talked to industry commentators and
associations, suppliers, competitors and employees in search of information and
knowledge.
Through careful analysis, the strategic drivers were now becoming clear, the
market and competitive terrain had fundamentally shifted and Aardvark now appeared to
be positioned in the wrong place to take optimal advantage from this powerful set of
trends. On the basis of this analysis MindShifts proposed strategies that would move
Aardvark to take advantage of the emerging opportunities.
Working with MindShifts, Aardvark was able to move quickly to modify its
capability and move into emerging market segments through a new distribution channel
with the right sort of product and service offer. Within 12 months, Aardvark had reversed
the erosion in market share and was also experiencing strong growth in the new market
segments they had entered. Aardvark obtained first mover advantage and its major
competitor is now playing catchup.

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MindShifts continues to supply key intelligence and analysis to Aardvark and has
now assisted them to develop their own competitive intelligence capability.
Other examples of the types of work we have done for other clients are outlined below:
 Competitor Profile
A typical assignment would encompass profiling one or more aspects of a particular
competitor, including: strategies, market positioning / sales / advertising, operations,
personnel, management, logistics / distribution, financial, manufacturing or
information technology components. A detailed report is delivered outlining the
competition's current and projected future activities, as well as recommendations for
our client to maintain or improve market positioning.
 Organizational Charts
A firm wanted to gain an understanding of the organizational structure and dynamics
of a potential acquisition before making the final decision to purchase. The
MindShifts Group was asked to identify all departments, structure, staffing and head
count. This information was used to develop an understanding of the duplication that
would exist between the two firms in the event of a merger.
 Industry Profile
A client approached The MindShifts Group to identify companies within their
industry sector, and provide brief profiles on the major players. A report was
delivered identifying new competitive threats and possible counter strategies for our
client.
Some Common Questions
How do you initiate a CI program for an emerging company?
Especially in a rapid growth environment.
The best way to say this is 'start small'. As a small company your competitive
sensors are already finely tuned. Moving from using the Internet for your basic research,
you will get the most from gathering information at tradeshows and conferences. Don't
go without a plan though. Attend with a small group and assign individuals to monitor

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certain booths and seek answers to specific lists of questions. Leonard M Fuld offers
more detail on intelligence gathering at tradeshows in his book, 'The New Competitor
Intelligence'. Again, these shows or conferences are where the latest news or
development activity bubbles to the surface - way before you read it in the press. Don't
forget to share information across the company. You will be surprised what colleagues
will pick up from customers and suppliers.
The subject of Business and Competitive Intelligence is getting a lot of air time and
people often switch between BI and CI. Are they the same thing? What is the
difference?
Over the past year or so, Business Intelligence has come to mean data
warehousing. Software companies use this "new" term to address database management
and so it has moved from its original meaning of business competitiveness. Competitive
Intelligence however is not just about your competitors, but about your own
competitiveness. It is the organizational process that guards a company's competitive
advantage. Competitive Intelligence is used to identify what it is that you need to know
about your environment and organization that will enable you to compete more
effectively as well as how competitive you are and how you can compete more efficiently
and effectively in the future. The Competitive Intelligence process involves the gathering,
analyzing and interpreting of publicly available information to serve as the basis of
strategic decisions and as input into the development of competitive strategy.
To put it more succinctly, Competitive Intelligence considers the potential effects
of, and opportunities created by, all external elements of the competitive environment
(regulatory, technical, economic, etc.)
Competitive Analysis is an element of CI that focuses primarily on current and
potential competitor-created forces.
Remember that CI is not market research, abstracts or news articles, thick reports
of facts, nor found. CI is processed, actionable information used for minimizing strategic
decision risk. It is created for a specific purpose.

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There is a great deal of business intelligence software available now. What software
would you recommend for setting up a CI system in our company?
There are a number of software programs and SCIP has published a study on
software (see Fuld & Co "Intelligence Software Report 2000"), however, the appropriate
software will depend on your organizational requirements and existing IT systems.
Sounding like a broken record - Software will NOT produce intelligence.
Software cannot read and understand your questions. Software cannot read and
understand supporting materials - NOT NOW ... and may I suggest, not ever! The human
brain is still the only software and hardware that can make sense of and analyze
information to produce meaningful intelligence for decision makers.
However, having said the above, CI software and/or IT is an enabler in the CI
process. As a tool it can play a number of roles - it can become a data collector, filter, and
repository; it can move the information to the right customers; and it can make the whole
intelligence process more user friendly allowing more people to participate in sharing
vital knowledge.
Just remember, without the analysis and understanding, and using only a software
system, all you are doing is moving information around your organization. No
intelligence has been created.
How can I begin a CI project in my company?
CI can be started in a small way. The key is understanding who your client user
will be and key issues that they will be addressing over the coming months. Without a
key intelligence topic (KIT) or key intelligence questions (KIQ) you have no project.
Once you have understood your clients requirements and the strategic issues involved
you can start your CI project. The first step in establishing any CI program in a company
is to ensure that you are able to deliver some value at the end. By starting with a small
project and working with your client, your chances of success increase.

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Chapter 2
PROFILE OF BPO, IT AND CRM SOCIETY
(BIC SOCIETY)
VISION:
To make North Karnataka Region an international destination for BPO, IT and
CRM activities.
MISSION:
 Facilitating setting up of BPO, IT & CRM enterprises in North Karnataka
 Developing and harnessing the human resource potential in North Karnataka
region by enabling educational institutions in training & development of
students in this region.
 Facilitate and Co-ordinate recruitment process for the benefit of industry and
students.
 Encourage entrepreneurship in the area of BPO, IT and other allied areas in this
region.
 To lobby with Governmental Agencies for creation of necessary infrastructure
and environment for IT related activities in this region
NEED FOR THE SOCIETY:
Information Technology has a tremendous potential for economic development
in the North Karnataka region. STPI, IIITB (Hubli Campus), STEP, and Incubation
Centers have all been set up to usher in the IT revolution in this region. Research
projects at Undergraduate, Postgraduate and Doctoral levels have been carried out on
various facets of the above area. In order to see discernible results in the form of wealth

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creation and employment generation at the regional level, it is felt that a society for
BPO, IT & CRM activities should be setup to initiate, co-ordinate and generally be a
catalyst for development of all resources in this region. This Society will also help in
creating an environment suitable for development of IT industry in this region. Hence
this Society is being formed
THE OBJECTIVES OF THE SOCIETY
 To make North Karnataka as the international destination for BPO IT and
CRM activities.
 To facilitate, associate and help, in all ways possible, various Government
agencies and departments for improving the infrastructure facilities as
required by the IT and allied companies.
 To encourage research in the areas of CRM, BPO and ITES sectors by
initiating projects at graduate, postgraduate and at doctoral levels.
 To encourage setting up BPO, IT based industries or ventures in the region by
increasing awareness amongst potential students for a career in BPO, IT,
improving the Human Resource base through education and add-on Training
Programs.
 To Increase social awareness of BPO, IT industry and also remove some
misapprehensions of the industry so that it helps in overall development of the
region.
 To design and facilitate conduct of training programs to enhance skills of
students seeking career in BPO, IT sector.
 To facilitate the Venture capitalist invest in this sector and thereby help in
overall growth of BPO, IT sectors in this region.
 To provide information on State and Central Government Policies on various
support and incentives available to this sector.

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 To help evolve and design ITES policy for the BPO / ITES and CRM sector
with special reference to the North Karnataka region.
 To undertake any activity that the Executive Committee may feel necessary
for the overall development of the BPO, IT sector in North Karnataka region.
BPO (BUSINESS PROCESS OUTSOURCING) Industry
profile
What is Business Process Outsourcing (BPO)?
The concept of outsourcing started with Ross Perot when he founded Electronic
Data Systems in 1962. EDS would tell a prospective client, "we are familiar with
designing, manufacturing and selling furniture, but we're familiar with managing
information technology. We can sell you the information technology you need, and you
pay us monthly for the service with a minimum commitment of two to ten years.
BPO is the act of transferring some of an organization's repeated non-core and
core business processes to an outside provider to achieve cost reductions while improving
service quality. Because the processes are repeated and a long-term contract is used,
outsourcing goes far beyond the use of consultants. If done well, BPO results in
increasing shareholder value. The main difference between BPO and more traditional IT
outsourcing is that BPO offers companies a way of achieving transformational outcomes
much more quickly. In a typical BPO contract, a service provider takes over a specific
corporate function. Effective BPO encompasses much more than just changing who is
responsible for performing the process. In BPO, the outside provider not only takes on
the responsibility to manage the function or business process, but also re-engineers the
way the process has been traditionally done.
The next generation of Business Process Outsourcing has emerged as a priority
for businesses looking to better options in managing their application portfolios. The first
wave offered low-cost, off-shore development labor, but today firms are demanding new,
less risky options for applications that are strategic, complex, or mission-critical, while

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still taking cost into consideration. Outsourcing has moved from a niche technology
management tool to a mainstream strategic weapon. Business Process Outsourcing
leverages process driven efficiencies in terms of organizational excellence,
responsiveness & branding, financial efficiency and customer relationship. BPO is
emerging as a powerful and flexible approach that business leaders can use to achieve a
wide range of tactical and strategic aims.
The most common business process that gets outsourced is call centers. Call
centers and Help Desks of many multi national and fortune 500 companies are being
outsourced to low waged, English speaking countries such as Philippines and India.
Countries like India with vast IT human resources are also attracting outsourcing from
American IT/Technology companies to outsource their IT Help Desks. Many of these
help desks are state of the art with latest Help Desk software and help desk hardware with
technical savvy IT graduates behind them answering your questions.

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Key Elements of BPO
Business Process Outsourcing in today's world is seen as a strategic management
option rather than just a way to cut costs. It helps achieve the companies their business
objectives through operational excellence and an edge in the market place.
Every company today, has one or more of its services outsourced so that it can
focus more on its core competencies. Outsourcing's emerging power as a business tool of
unique versatility and flexibility is undoubted. Resources of the companies need to be
focused on core business functions so the non-core functions need to be outsourced.
Outsourcing gives you the right combination of people, processes and technology to
operate effectively in the Global market place without burdening your time and budget.
This is the reason why more and more companies are showing interest in
outsourcing there activities to various offshore locations. With the cost to bring a product
from development to market having increased significantly, outsourcing is seen as a
potential savior. Two prime factors come into play when searching for a reliable
outsourcing provider: quality and price.

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BENEFITS OF BPO
Business Process Outsourcing (BPO) has been found beneficial to the
businesses with the results of increased customer satisfaction. More efficient operations,
access to global capabilities, increased cash flow, and faster time-to-market are also the
very feasible outcomes of BPO.
Non-core business processes, such as human resources, finance and accounting,
are critical, but also resource-intensive, time-consuming, and costly. Outsourcing
improves operational efficiencies and drastically reduces costs without large, up-front
capital investments. Business Process Outsourcing provides quantifiable benefits through
improved efficiencies, lower overhead, reduced payroll and benefit expenses, and fewer
capital investments.

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Companies seeking the Business Process Outsourcing benefits generally engage
themselves in a systematic process led by the outsourcer and well designed to ensure a
positive and mutually beneficial experience for both client and provider.
BPO allows organizations to move non-core business processes to a services
provider so that they may focus on the more important strategic, revenue-generating
programs that create profitable growth and sustain business success. BPO provides access
to proprietary workflow systems, process reengineering skills, and innovative staffing
and delivery models, combined with world-class technology delivered by experts.
Business Process Outsourcing provides the flexibility to respond to a rapidly changing
marketplace and scale operations up or down as conditions dictate.
How big is this Business Process Outsourcing affair really? The first question is
about the size of the ITES/BPO business in the years ahead. There is such a wide range of
estimates put out by consultancies and private research agencies that credibility is at a
premium. An estimate prepared by IDC that NASSCOM cites sees global ITES business
rising from $570 billion in 2002 to $1,200 billion in 2006. The recent E-Commerce and
Development Report 2003 cites a Goldman Sachs figure of $570 billion in 2005 for
global BPO contracts and a Gartner estimate of $300 billion of ITES revenue in 2004.
Another research agency, Forester, says that because of unreliability of suppliers, the
global BPO business will rise to only $145 billion by 2008.
With the increasing presence of Globalization, many companies are turning to
offshore outsourcing. Outsourcing increasingly has taken the shape of Business Process
Outsourcing, where whole business processes (such as support and development) are
outsourced. Worldwide spending on Business Process Outsourcing (BPO) services will
increase to $682.5 billion in 2008, with a compound annual growth rate of 11 per cent,
says a study by analyst firm IDC.
The growing backlash against BPO mirrors the public protests against the loss of
jobs in manufacturing in the 1970s and 1980s - with one difference. Workers in IT and
high-tech are numerically fewer but they are more powerful and have a greater visibility
than the organized labor of the 1980s. Whatever the management consultants may say

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about the larger benefits of outsourcing to the U.S. and the U.K. economies, rising
unemployment among IT workers will lead to political and social lobbying that will
compel corporations to go slow on outsourcing. The sword of globalization will be fought
bitterly by the IT community in the U.S. Irrespective of the logic of globalization; the
favored locations for BPO cannot hope to benefit freely from the drive to relocate
services.
Cross-border business process outsourcing is an emerging field in which the
Indian subcontinent has moved forward aggressively and is one of the leaders in the field.
India, one of the leaders in the Business Process Outsourcing sector in the world today,
owes a robust growth of 8% in its economy to BPO. The past few years have seen major
IT companies from the United States outsourcing their work to the subcontinent. All
around the world, however, countries now compete to offer BPO services to large
multinational organizations.
The driver of this next stage in automation is not technology per se, but changes
in competition and how businesses operate and execute their strategies. The Internet may
be the agent of change, but the engine of change is a need to cut costs and improve core
business processes in increasingly competitive global markets.
THE OUTSOURCING HISTORY OF INDIA
The outsourcing history of India is one of phenomenal growth in a very short span
of time
The idea of outsourcing has its roots in the 'competitive advantage' theory
propagated by Adam Smith in his book 'The Wealth of Nations' which was published in
1776. Over the years, the meaning of the term 'outsourcing' has undergone a sea-change.
What started off as the shifting of manufacturing to countries providing cheap labour
during the Industrial Revolution, has taken on a new connotation in today's scenario. In a
world where IT has become the backbone of businesses worldwide, 'outsourcing' is the
process through which one company hands over part of its work to another company,
making it responsible for the design and implementation of the business process under

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strict guidelines regarding requirements and specifications from the outsourcing
company. This process is beneficial to both the outsourcing company and the service
provider, as enables the outsourcer to reduce costs and increase quality in non core areas
of business and utilize his expertise and competencies to the maximum. And now we can
see the benefit to the service companies in India as they mature, prosper and build core
capabilities beyond what would generally be possible by the outsourcing company.
Since the onset of globalization in India during the early 1990s, successive Indian
governments have pursued programs of economic reform committed to liberalization and
privatization. Till 1994, the Indian telecom sector was under direct governmental control
and the state owned units enjoyed a monopoly in the market. In 1994, the government
announced a policy under which the sector was liberalized and private participation was
encouraged. The New Telecom Policy of 1999 brought in further changes with the
introduction of IP telephony and ended the state monopoly on international calling
facilities. This brought about a drastic reduction and this heralded the golden era for the
ITES/BPO industry and ushered in a slew of inbound/outbound call centres and data
processing centres. Although the IT industry in India has existed since the early 1980s, it
was the early and mid 1990s that saw the emergence of outsourcing. One of the first
outsourced services was medical transcription, but outsourcing of business processes like
data processing, billing, and customer support began towards the end of the 1990s when
MNCs established wholly owned subsidiaries which catered to the process off-shoring
requirements of their parent companies. Some of the earliest players in the Indian market
were American Express, GE Capital and British Airways.
The ITES or BPO industry is a young and nascent sector in India and has been in
existence for a little more than five years. Despite its recent arrival on the Indian scene,
the industry has grown phenomenally and has now become a very important part of the
export-oriented IT software and services environment. It initially began as an activity
confined to multinational companies, but today it has developed into a broad based
business platform backed by leading Indian IT software and services organizations and
other third party service providers. The ITES/BPO market expanded its base with the

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entry of Indian IT companies and the ITES market of the present day is characterized by
the existence of these IT giants who are able to leverage their broad skill-sets and global
clientele to offer a wide spectrum of services. The spectrum of services offered by Indian
companies has evolved substantially from its humble beginnings. Today, Indian
companies are offering a variety of outsourced services ranging from customer care,
transcription, billing services and database marketing, to Web sales/marketing,
accounting, tax processing, transaction document management, telesales/telemarketing,
HR hiring and biotech research.
Looking at the success of India's IT/software industry, the central government
identified ITES/BPO as a key contributor to economic growth prioritized the attraction of
FDI in this segment by establishing 'Software Technology Parks' and 'Export Enterprise
Zones'. Benefits like tax-holidays generally enjoyed by the software industry were also
made available to the ITES/BPO sector. The National Telecom Policy (NTP) introduced
in 1999 and the deregulation of the telecom industry opened up national, long distance,
and international connectivity to competition. The governments of various states also
provide assistance to companies to overcome the recruitment, retention, and training
challenges in order to attract investments to their region. The National Association of
Software and Service Companies (NASSCOM) has created platforms for the
dissemination of knowledge and research in the industry through its survey and
conferences. NASSCOM acts as an 'advisor, consultant and coordinating body' for the
ITES/BPO industry and liaisons between the central and state government committees
and the industry. The ardent advocacy of the ITES/BPO industry has led to the inclusion
of call centers in the 'Business Auxiliary Services' segment, thereby ensuring exemption
from service tax under the Finance Bill of 2003.
These measures have led to a steady inflow of investments by large foreign
companies such as Reuters, for establishing large captive ITES/BPO facilities across
India. Moreover, the existing ITES/BPO operations of major multi-nationals are also
being ramped up to cater to the ever increasing demand for better and speedier service.
Almost all of India's top ITES/BPO giants have announced some form of expansion and

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are in the process of hiring manpower to fill the additional seats. India's competitive
advantage lies in its ability to provide huge cost savings thereby enabling productivity
gains and this has given India an edge in the global ITES/BPO marketplace. NASSCOM
studies pinpoint the following factors as the major reasons behind India's success in this
industry (Source: www.nasscom.org):
 Abundant, skilled, English-speaking manpower, which is being harnessed
even by ITES hubs such as Singapore and Ireland.
 Improving telecom and other infrastructure which is at par with global
standards.
 Strong quality orientation among players and their focus on measuring and
monitoring quality targets.
 Fast turnaround times and the ability to offer 24x7 services based on the
country's unique geographic location that allows for leveraging time zone
differences.
 Proactive and positive policy environment which encourages ITES/BPO
investments and simplifies rules and procedures.
 A friendly tax structure, which places the ITES/BPO industry on par with IT
services companies.
Outsourcing to India offers significant improvements in quality and productivity
for overseas companies on crucial parameters such as number of correct
transactions/number of total transactions; total satisfaction factor; number of
transactions/hour and average speed of answer. Surveys by NASSCOM also revealed that
Indian companies are better focused on maintaining quality and performance standards.
Indian ITES/BPO companies are on an ascending curve as far as the quality standards are
concerned. Organizations that have achieved ISO 9000 certification are migrating to the
ISO 9000:2000 standards and companies on the CMM framework are realigning
themselves to the CMMI model. Apart from investing in upgrading their CRM and ERP
initiatives, many Indian ITES companies are beginning to acknowledge the COPC
certifications for quality and are working towards achieving COPC licenses.

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Despite being a fledgling in the global ITES/BPO industry, the Indian ITES
industry recorded a growth rate in excess of 50% in 2002-03. Industry experts consider
this a positive indication of the times to come and a look at the ranking and the revenue
and headcount statistics show the potential of the industry. The global ITES/BPO
industry was valued at around US$ 773 billion during 2002 and according to estimates by
the International Data Corporation worldwide, it is expected to grow at a Compounded
Annual Growth Rate (CAGR) of 9% during the period 2002-2006. NASSCOM lists the
major indicators of the high growth potential of the ITES/BPO industry in India as the
following (Source www.nasscom.org
 During 2003-04, the ITES-BPO segment is estimated to have achieved a 54
percent growth in revenues as compared to the previous year.
 ITES exports accounted for US$ 3.6 billion in revenues, up from US$ 2.5
billion in 2002-03.
 The ITES-BPO segment also proved to be a major opportunity for job seekers,
creating employment for around 74,400 additional personnel in India during
2003-04.
 The number of Indians working for this sector jumped to 245,500 by March,
2004.
 By the year 2008, the segment is expected to employ over 1.1 million Indians,
according to studies conducted by NASSCOM and leading business
Intelligence Company, McKinsey & Co. Market research shows that in terms
of job creation, the ITES-BPO industry is growing at over 50 percent.
Surveys of the Indian ITES/BPO industry in 2004 expected it to follow the trends given
below:
Customer care: Customer care and support services will continue to lead in
terms of revenue generation, with a turnover of around US$ 1200 million in 2003-
04., up from last year's turnover of US$810 million.
Finance: With the financial services segment moving into value added domains
like insurance claims processing, financial management services and equity

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research, this segment is expected to clock the highest growth, with estimates of
US$820 million in revenue in 2003-04, up from US$510 million in 2002-03.
HR services: HR services are also expected to grow and revenues are expected to
touch US$70 million during 2003-04, thereby providing latent opportunities to the
industry's dominant players.
Payment services: This segment has also been identified as a high growth area
within the industry, and is expected to generate revenues of around US$430
million for 2003-04, up from US$210 million in 2002-03.
Administration: Revenues from the administration services segment are
expected to increase from US$ 310 million in 2002-03, to US$540 million during
2003-04.
Content development: The content development services segment which
includes engineering and design services, digitization (GIS), animation, network
management and biotech research, is expected clock a turnover of around US$520
million in 2003-04.
The availability of technically trained and skilled manpower in India is making
companies across the world look at the country as a profitable base to shift their high-end
support services. Companies like COLT Technology Services are considering
outsourcing their technical back-office support work to India. Other areas are high-end
network engineering/management support. Another field which is showing immense
potential is that of digital content creation and animation. Animation studios like Walt
Disney, MGM and Warner Brothers are already outsourcing low-end work like clean-
ups, tweening and modeling to India. The availability of skilled and trained manpower
and India's ability to keep in step with the latest technological advances in the industry is
prompting foreign studios to consider India as a base to shift other high-end animation
work like storyboarding and developing original content for animated films ad TV series.
Tele-radiology is the next segment that holds great promise, mainly due to the time zone
differences and the availability of highly skilled radiologists and companies like
Teleradiology Solutions have been offering their services to US and South-East Asian

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hospitals for the past two years. Engineering services like CAD/CAM 2D, 3D and CAE
modeling and design automation are the latest additions to the ever increasing list of
processes being outsourced to India.
COMPANY PROFILE
Manthan Services
Manthan is a leading provider of Business Process Management services to
companies in the legal, retail and market research domain. We run world-class service
operations in the Indian and global environment.
We specialize in provisioning of offshore professional services to firms through
global delivery model. We are guided by some of the leading thought leaders and domain
experts from the industry.
Manthan Services has a pointed focus to comprehensively deliver the value of
quality and cost to companies around the world through optimized global delivery model.
Headquartered in Bangalore, Manthan provides comprehensive support services
in the niche areas of Legal, Retail and Business & Market Research Verticals.

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Manthan's core strength in the legal domain is a team consisting of highly
qualified solicitors blended with vast experience in the legal domain working together
with people whose forte is process expertise in BPO. This combined capability of domain
and process expertise is the key proposition of Manthan service offerings ensuring
predictability and reliability.
Manthan provides services across the lifecycle of Business and Market Research.
The services span intelligence reports on companies/sectors/economy. As part of
quantitative data analysis Manthan is a strategic partner to various Market research firms,
enabling them with high-end analytics capabilities. We support firm in their bid to be
more competitive and service a variety of research needs. We cover the entire lifecycle
starting from data aggregation to business reporting & presentation services.
In the retail domain, Manthan works with retailers to provide complete analytics
solution and support them in their various functions. With a thorough grounding in this
domain, Manthan Services offers a wide range of services to players in the global retail
industry delivering quality services.
Services
Legal Services Manthan provides comprehensive case management support and
transaction processing services to solicitor firms across domains of:
 Intellectual Property Law
 Conveyancing
 Remortgage
 Immigration Law
 Employment Law
 Injury Compensation Law
 Wills and Probate

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Manthan provide other support services like legal transcription and data
digitization & archiving services to our clients.
Retail Services
Manthan cover the entire retail cycle offering support services to retailers in
stages of planning, procurement, sales and tracking. The service offering ranges from
tracking activities like invoice reconciliation to product information management. Sales
support services like Customer Information Management and Catalogue Management are
part of our core offering. Our expertise spans:
Retail Analytics
Plano grams
Content Management
Catalogue Management
Transaction Audits
Invoice Reconciliation
Research and Analysis
Manthan provide comprehensive support to Market and Business Research companies
across various verticals. The services include:
 Data Preparation & Analysis
o - Statistical Modelling Reporting
o - Media Evaluation
 Clip Coding & Analysis
 Industry/Company/Market Profiling
- Competitor Analysis
- Benchmarking
Transaction Processing
Manthan provide backend support and processes voluminous transactions for its
clients. We provide expertise for both, contact and non-contact services. Our systematic
approach towards training, quality control and service delivery helps our associates,
process transactions and consistently perform above the client's enterprise averages.

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Manthan cover the entire range of services in payroll and accounting including
accounts receivables / payables, ledgers, bookkeeping, financial reporting among others.
Customer Care
Manthan provide support services across all customer touch-points such as phone,
e-mail, web-response, and chat. We provide round the clock support for customer care,
order processing, complaint resolution, direct response and e-mail response management.
Manthan highly skilled and trained work force manages your services to deliver customer
delight.
Sales Support
Manthan provide a full range of marketing support including acquisition,
retention, win-back programs, lead generation, market research surveys, and appointment
setting to both business-to-business and business-to-consumer customers. Manthan offer
sophisticated data analysis techniques and provide constant campaign performance
information that is utilized to evaluate our calling strategies and re-focus our efforts when
necessary.
Clients
At Manthan, we have committed to excellence and are constantly upgrading our
expertise in our key domains.
Manthan work with prestigious Market & Business Research and firms for our
service in the Research and analysis domain
Request for Case Studies in Research & Analysis
Manthan are working with some of the largest retailers in the area of Retail
analytics and transaction processing services.
Request for Case Studies in Retail
Manthan clients include leading solicitor firms based in UK providing direct legal
services. The ken of services delivered span from legal research to legal case
management in residential conveyancing.
LEGAL SERVICES

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Manthan at Manthan make an attempt to be an extended arm/team of our clients
(law firms in Us, UK and other commonwealth countries). Manthan have built a team of
qualified lawyers with expertise in UK and US laws. Our service offerings span the
following practice areas:
Intellectual Property Law
Manthan IP practice assists companies in various activities including patent
search, patent landscaping, patent drafting, Freedom-to-Operate, agreements besides
trademark and copyrights services. Our IP team is a blend of technology experts and IP
solicitors.
Conveyancing
Manthan provide conveyancing services including sale, purchase and right-to-buy
services. Our team is proficient in drafting documents, coordinating with lenders,
purchasers, sellers, housing council and bank for the complete lifecycle of a transaction.
Our team has expertise in handling most exceptions, which can occur in such
transactions.
Remortgage
Manthan remortgage services help client in managing all stages of the transaction
lifecycle. Manthan team handles the complete process from receiving instructions,
updating the case management tool, asking lender for documents, coordinating the all
concerned parties to ensuring that the payment is received by the lender within the
specified time frame. Manthan team proactively handles all reviews during the
remortgage lifecycle.
Immigration Law

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Manthan draft documents related to all immigration practices spanning work
permits, citizenship, sponsorship declarations, student & visitor visas, change in status
and all other permits.
Employment Law
Manthan employment law practice has expertise in drafting commercial
agreements, claims for unfair dismissal, discrimination, working time regulations etc.
Injury Compensation Law
Manthan team offers Injury compensation law services like road traffic accidents
and employment related injuries. Manthan expertise and knowledge in this field puts us
in the best position to service these needs.
Wills and Probate
Manthan provide wills and probate drafting services from our India center. Our
team, proficient with UK laws and US is best placed to provide these services from India.
The review procedures both at India and onsite ensure quality of service.
RETAIL SERVICES
Retail Analytics
Manthan cover processes that aim to drive market share and customer profitability
through the use of intelligence derived from data mining and statistical modeling.
Manthan Analytics umbrella includes tools and capabilities that can enhance the
identification, acquisition, management, and retention of customers.
Process examples include risk modeling, data mining, actuarial and underwriting
services, response models, customer segmentation, and cross-sell models. These
processes form part of every stage of supply chain sales analysis, Panel Data Analysis,
promotion effectiveness, merchandise planning and inventory planning.
Panel Data Analysis

A project report on competitive intelligence for manthan services bangalore

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