EiTESAL event UK Market challenges & opportunities 18/7/2017

Supporting Egyptian ICT
Companies in the UK Market

Welcome
▪ Omar Massoud, Director at Bridjes.
▪ London-based consultancy, specialising in
the transfer of technical expertise between
the UK/Europe and Egypt/MENA in
construction, technology and sustainable
development.
▪ We provide business intelligence, project opportunities and
in-country representation and support.
▪ We help our clients develop business and export
opportunities, while reducing risk, cost, and time.

Overview
▪ Part One: The UK ICT Market
o Overview of Key Sectors
o Market Conditions
o Regulations
▪ Part Two: Capitalising on Opportunities
o Opportunities in the UK and beyond
o How We Can Help
▪ Q&A

Part One
1. UK Market Overview
2. Software Development
3. Hardware & Electronics
4. BPO / Outsourcing
5. Cyber Security

UK Market Overview
▪ UK is world’s 5th largest economy (c. $2.7tn)
▪ UK is one of the world’s largest ICT markets
▪ Expertise and opportunities in:
o Software development
o Mobile devices
o Telecommunications
o Cyber security
o Cloud computing
o Data centres

UK Market Overview
▪ Selected Events & Exhibitions:
o IP Expo: Enterprise IT, covering cloud and cyber security
o Infosecurity Europe: Largest in Europe
o World Cyber Security Congress: Senior-level conference
o eCommerce Expo: Covers the whole landscape
o IT Showcase: Executives meet the suppliers
o UC Expo: Europe’s largest unified comms event
o EHI Live: Europe’s leading IT healthcare solutions.

UK Market Overview
▪ Trade & Professional Associations:
o Tech UK
o The Chartered Institute for IT (BCS)
o Cloud Industry Forum (CIF)
o UK IT Association (UKITA)
o Cyber Security Information Sharing Partnership (CiSP)
o Institute of Electrical and Electronics Engineers (IEEE)
o Business Application Software Developers Association
(BASDA)
o Association of Independent Computer Specialists (AICS)
o Knowledge Transfer Network (KTN)

UK Market Overview
▪ Main Laws & Regulations:
o Copyright, Designs and Patents Act 1988.
o Data Protection Act 1998.
o Privacy and Electronic Communications (EC
Directive) Regulations 2003 (PECR).
o Business Protection from Misleading Marketing
Regulations 2008.
o Defamation Act 2013.

Software Development
▪ Businesses that write, modify and test systems and
applications software, databases and web pages.
▪ Considerable progress and growth as businesses and
individuals become reliant on electronic devices.
▪ High demand for customised software from IT and
finance sectors.
▪ Revenue grew at 8.9% over the five years to 2016-17.
▪ To generate revenues of £26.6 billion in 2017.

▪ Strong growth of new technologies (cloud computing)
to support industry expansion through more
challenging conditions.
▪ Emerging niche technologies likely to attract new
entrants to the industry.
▪ Large operators are expected to absorb smaller
companies to increase their specialisation in new and
lucrative segments.
▪ Expected growth at 6.7%; revenues to £36.7 billion in
2021-22.

Establishments (%)
▪ London: 30.2%
▪ South East: 20.1%
▪ East: 9.6%

▪ Market Conditions (1/2)
o Low barriers to entry.
o Strong competition places downward pressure on
profit margins.
o Low level of market share concentration reflects
the fragmented nature. 87.1% of enterprises have
fewer than five staff.
o Largely dominated by multinational technology
firms headquartered outside the UK.

o Rising global connectivity means smaller overseas
developers are able to penetrate the market.
o National boundaries have little relevance; location
of production has little significance.
o Companies will locate wherever a pool of skilled
software engineers are located.
o Teams collaborate across borders; expected to
increase, boosting industry globalisation.

▪ Regulations
o Majority of regulation relates to copyright, data
protection and intellectual property laws.
o Copyright, Designs and Patents Act 1988 prevents
copying or modifying software beyond licence rights.
o Data Protection Act 1998, protects sensitive personal
data (financial, health, etc.)
o Globalised nature means regulation is coordinated
across borders. UK member of World Intellectual
Property Organization (WIPO); EU Trade Mark Regs.

Hardware & Electronics
▪ Sector worth £16 billion to the UK economy;
employing c. 300,000 in 2,000 companies.
▪ UK strengths:
o Strong intellectual property rights (IPR) framework
and legal system
o Large and growing software sector
o Innovative and integrated R&D, involving academia,
companies and industry groups.
▪ UK has 40% of European electronics design industry.
▪ UK has expertise in integrated circuits (IC);
monolithic microwave integrated circuits (MMIC);
and electronic components.

▪ UK has 150 independent electronic system design
houses – the largest in Europe.
▪ Strong demand for medical; automotive; defence and
security electronics.
▪ Electronic component manufacturing
(semiconductors and other components for
electronic applications) worth over £2 billion; but
declining (-1%) as it struggles to compete with larger
international production facilities.
▪ Loaded electronic board manufacturing (PCB and
interface cards) worth £1 billion; declining (2%) as
firms continue to offshore manufacturing.

▪ Market Conditions
o Despite declining market for manufacturing; global
demand expected to grow, especially in developing
and emerging markets.
▪ Regulations
o Regulation primarily in Intellectual Property Rights.
o Further regulations, technical standards and
environmental laws govern any manufactured
electronics or hardware, to ensure compliance and
compatibility.

Contact Centre / BPO
▪ Contact centres provide inbound and outbound
telecom services to improve client relationships,
provide technical assistance, market goods or conduct
opinion polls.
▪ Healthy growth over the past five years, with revenues
at £2.3 billion in 2016/17.
▪ Growth is expected to slow down to near-stagnation at
0.7% over the coming five years.
▪ Main reasons are Brexit effect (low business
confidence) and low-cost int’l competition.

▪ Key success factors
o Multiskilled and flexible workforce: Helps provide
extensive coverage and reduce labour turnover,
giving competitive advantage.
o Accurate information: Call centre workers are often
asked for advice or requested to solve problems.
o Quickly adopt new technology: Important to keep up
with the significant technological change.
o Large supply contracts: Provides protection from
serious difficulties if they lose any one contract.

Establishments (%)
▪ North West: 18.4%
▪ South East: 12.5%
▪ London: 12.5%

o Industry concentration is low; but has risen over the
five years through 2016-17.
o Competition is High and Increasing.
o Internal competition: In-house teams and responding
to local market demand to bring services home.
o External competition: low-cost, good quality,
offshore services.

o Barriers to entry are low. Main challenges are a
skilled workforce and choosing the right location.
o Largest UK contact centre operators are global
operators: Teleperformance, Sitel and Convergys.
o Trend towards greater offshoring lost traction in end
of 2000s, due to quality concerns and rising costs.
o Offshoring still a main factor; India, the Philippines
and other English-speaking countries benefiting.

▪ Regulation (1/2)
o Regulation level is Medium; and Increasing.
o Regulated by Ofcom (regulatory and competition authority
for the broadcasting, telecommunications and postal
industries). It operates in cooperation with the Information
Commissioners Office (ICO).
o The main legal frameworks are Data Protection Act 1998
and the Privacy and Electronic Communications (EC
Directive) Regulations 2003 (PECR).
o The main areas affected by regulation are silent and
abandoned calls, calling from a withheld number and the
Telephone Preference Service (TPS).

o When calling other businesses, numbers must be screened
against the Corporate Telephone Preference Service (CTPS).
o Effective May 2016, the government made it illegal for call
centres to make outbound calls with a withheld number.
o Effective Spring 2017, company directors will be facing fines
of up to £500,000 each if their companies are found in
breach of Ofcom defined rules.
o Compliance with relevant regulation is likely to lower firm's
operating efficiencies, as employees will have to monitor
silent and abandoned call rates

▪ Outsourcing in Egypt
o In October 2016, Egypt awarded European Outsourcing
Association (EOA) “Outsourcing Destination of the Year”.
o A.T. Kearney (2011) recognised Egypt as a leading global
outsourcing destination (4th worldwide), and MENA leader.
o Outsourcing sector has grown rapidly in recent years,
posting annual growth of 7.5% annually since 2014.
o In 2015, c. 50,000 Egyptians employed in offshore BPO
sector; additional 40,000 in regional outsourcing.
o ITIDA aims to shift outsourcing from low-value to high-value
service model, by moving into more complex areas.

▪ BPO in Europe
o European BPO services market revenue over US$50 billion
in 2016. UK share 40+%.
o Healthy growth expected over the coming five years at c. 3%

▪ BPO in Europe
o Vertical-specific BPO was the most lucrative segment,
accounting for US$14 billion in 2016 revenues.
o CRM BPO was a close second with revenues of US$13.6
billion.

▪ BPO in Europe (Definitions 1/2)
o CRM BPO: Consumer direct services, including contact
centres, claims and warranties, collection services.
o Knowledge Process Outsourcing (KPO): Research and
analysis, risk research and management, strategy and
analytics, financial research, and legal process outsourcing
(LPO).
o Finance & Accounting BPO: accounts payable and
receivable, payment processing, invoicing, purchase order
management, and management reporting.

▪ BPO in Europe (Definitions 2/2)
o HR Outsourcing: Payroll services, benefits administration,
recruitment outsourcing, relocation services, performance
management, etc.
o Procurement BPO: Outsourcing of key procurement
processes, such as contract management, supplier
relationship management, sourcing support and
administration, etc.
o Vertical-specific BPO: Services that require technical domain
expertise in a range of processes: insurance policy
administration, claims and transactions processing, credit
cards analytics, patient administration, clinical research,
medical coding, etc.

Cyber Security
▪ Cyber security is a very fast-moving field where it is essential
to remain ahead of evolving threats.
▪ Global high-profile damage, threats and disruption have raised
awareness, even for smaller companies, especially where their
services and reputation can be easily damaged.
▪ Cyber security sector is estimated to contribute over £17 billion
to the UK economy; exports currently c. £2 billion, and target
£4 billion in 2020.
▪ The UK cyber security market is polarised between a small
number of large providers, and a bigger base of smaller
companies. (c. 600 in 2013)

Cyber Security
▪ In 2011 the UK government recognised cyber security as a top
level threat to the UK’s economic and national security.
▪ The UK set out its Cyber Security Strategy, and invested £860
million in a National Cyber Security Programme.
▪ In 2013 the UK set up the Cyber Security Information Sharing
Partnership (CiSP): a joint industry and government initiative
to exchange information in real time, in a secure, confidential
and dynamic environment, increasing situational awareness
and reducing the impact on UK business.
▪ CiSP is a free resource, and currently has c. 1,800 member
organisations and c. 5,000 individual members.

Cyber Security
▪ Cyber Essentials is a government-backed cyber security
certification scheme that sets out a good baseline of cyber
security suitable for all organisations in all sectors.
▪ The scheme addresses five key controls that can prevent
around 80% of cyber attacks.
▪ In 2014, the UK government made Cyber Essentials mandatory
for suppliers of government contracts that involve handling
personal information and providing some ICT products and
services.
▪ In 2015, the UK’s National Security Strategy confirmed that
cyber remained a top threat to national security, and that this
threat was increasing in scale and complexity.

Cyber Security
▪ From 2016, UK government investment increased to £1.9
billion, and set up a new National Cyber Security Centre
(NCSC) to protect the UK from cyber attacks and develop
sovereign capabilities in cyberspace.
▪ Cyber security is now included in the national education
curriculum from age 11, and in relevant undergraduate
programmes.
▪ GCHQ is the leading authority in cyber security, and now has
published standards for Masters Degrees in a range of cyber
security disciplines, and 12 approved Masters programmes.

Cyber Security
o Cyber security in the UK can be divided into four segments:
a. Defence/ intelligence b. Rest of government
c. Large enterprises d. SMEs, start-ups and consumers.
o Realistic opportunities exist in the last category: SMEs,
start-ups and consumers.
o Technology start-ups have neither the resources nor the
need to employ full-time staff with a solid grounding in
security
o An experienced track record and a high degree of speciality
in security are important.

Cyber Security
o For Egyptian companies who are able to provide a more
integrated solution beyond software and code reviews,
there may be significant opportunity to provide more
complete services to SMEs and start-ups which are not so
engaged in software development and less knowledgeable
on what threats they might face.
o SME security providers lack the knowledge of international
markets to operate overseas, which may provide good
opportunities for collaboration with Egyptian companies to
pursue opportunities in third country markets, especially in
the Middle East where there is growing demand for
solutions and expertise.

Cyber Security
o To ensure quality and demonstrate competence,
practitioner certification at multiple levels is required.
o Several compliance standards, certificates and accreditation
bodies are simultaneously making useful contributions and
vying for national or global prominence.
o BSI ISO/IEC 27001:2013 is the main compliance standard for
information security management
o NCSC’s Certified Cyber Security Consultancy (CCSC) scheme
is aimed at the public sector and private-sector
organisations looking to do business with the public sector.

Cyber Security
o ISACA and (ISC)2 are also recognised accreditation bodies;
with the CISA, CISM, CISSP, CIS-LI and CIS-LA well regarded
in the UK.
o Emphasis of practitioner certificates on relevant ‘hands-on’
experience to ensure awareness and ability to deal with the
evolving threats.
o No one nationally-recognised ‘top’ certificate or profile, but
rather a ‘horses for courses’ approach depending on the
organisation and threats in question.
o Emphasis on proven experience dealing with specific issues
for specific systems, in specific contexts, over any academic
or professional/practitioner certification.

Part Two
1. The Opportunities
a. In the UK
b. In Europe
c. Global Export
2. How We Can Help
a. Marketing
b. Sales
c. Admin Support

UK Opportunities
▪ Software Development:
o Rising global connectivity means smaller overseas
developers are able to penetrate the market.
o Outsourced software programming, data processing
and technical support.
o Teams collaborate across borders; expected to increase,
boosting industry globalisation.

UK Opportunities
▪ Outsourcing:
o Barriers to entry are low. Main challenges are a skilled
workforce and choosing the right location.
o Despite recent decline, offshoring still a main factor; to
the benefit of India, the Philippines and other English-
speaking countries.
o Opportunity to move into high-value BPO services,
beyond CRM BPO, in the UK and Europe. (Vertical-specific BPO,
in collaboration with relevant technical sectors in Egypt?)

UK Opportunities
▪ Cyber Security:
o Outsourced software and code reviews.
o Integrated solution to SMEs and start-ups that are not
so engaged in software development and less
knowledgeable on cyber threats.
o Collaboration to pursue opportunities in third country
markets, especially MENA (growing demand)
o Market favours proven experience over any academic or
professional certification.

European Opportunities
▪ TED (Tenders Electronic Daily)
o The online European public procurement portal.
o Publishes 460,000 calls for tenders per year, for about
420 billion euro of value.
o Provides free access to business opportunities from the
European Union, the European Economic Area and
beyond.
o Every day (Tuesday to Saturday), a further 1,700 public
procurement notices are published on TED.
o Browse, search and sort procurement notices by
country, region, business sector and more.

▪ TED (Tenders Electronic Daily)

▪ TED – Business Opportunities
o Call for expressions of interest (61)
o Contract notice (24,542)
o Design contest (187)
o Periodic indicative notice with call for competition (13)
o Prior information notice without call for competition
(13,731)
o Qualification system with call for competition (2,114)

▪ TED – Countries
o European Union (38,402)
o European Economic Area (1,150) – [Norway, Iceland,
Liechtenstein]
o Candidate Countries (241) – [Albania, Serbia, Turkey,
etc.]
o Government Procurement Agreement (540) – [ USA and
Switzerland]
o Other (315) – [100+, including Egypt]

▪ TED – Business Sectors

▪ Horizon 2020
The biggest EU
Research and
Innovation programme
ever with nearly €80
billion of funding
available over 7 years
(2014 to 2020).

▪ Horizon 2020: Funding Opportunities
o Research and Innovation Actions (RIA): Collaborative
research activities. 100% funded.
o Innovation Actions (IA): Plans & implementation of new/
improved products/processes/services. 70% funded.
o Coordination and Support Actions (CSA): Accompanying
activities on standardisation/ policy/ dissemination. No
research envisaged. 100% funded.
o Indirect Costs calculated at flat rate 25% of direct costs.

Export Opportunities
▪ UK Department of International Trade (DIT)
promotes and supports British businesses
and exporters, via 100+ worldwide offices.
▪ DIT provide:
o Information about international export markets
o Export opportunities
o Export finance
o Trade show grants
o Matchmaking international businesses with UK partners
and suppliers.

Export Opportunities
▪ Export Finance
o New and experienced exporters may qualify for finance
through UK Export Finance (UKEF).
o UKEF seeks to ensure no viable UK export fails due to lack
of finance or insurance from the private sector.
o As the UK’s export credit agency, UKEF helps companies:
i. Win export contracts by providing attractive
financing terms to their buyers
ii. Fulfil orders by supporting working capital loans
iii. Get paid by insuring against buyer default
o Other export loans available from approved suppliers.

How We Can Help
▪ Bridjes House
o International representation office in London
o Platform for international growth
o Low Cost; No Risk; Hassle-Free

How We Can Help
▪ Office Support Services
o International positioning: London presence, office
address and telephone; admin support.
o Business intelligence: Identify suitable opportunities in
the UK, Europe or overseas; identify and verify potential
partners and clients.
o Access to UK support: Via setting up in the UK, or in
partnership with our ltd company.
o Third-party management: Single point of contact for
your needs in the UK, and management of third-party
service providers (legal, accounting, sales agents, etc.)

How We Can Help
▪ Marketing Support Services
o Representation in international exhibitions and events.
o Communicate & meet with prospective clients/ partners.
o Communicate & meeting with DIT/ UKEF support teams.
o Organise trade events in London, to introduce to market.
o Networking in relevant trade and professional
associations (Tech UK; LCCI, etc.) for UK clients.
o Networking and marketing in EEN for European partners.
o Advertise on DIT’s “Find A Buyer” for international clients.

How We Can Help
▪ European partners with 20+ years
experience in European Projects.
▪ Support services include:
o Scouting for relevant opportunities in European funding
problems (Horizon 2020 and other programmes).
o Matching companies’ expertise with available calls for
proposals and potential projects
o Building project consortium or negotiating companies’
access to existing consortia.

How We Can Help
▪ Sales Support Services
o Prepare Market Information Pack.
o Appoint experienced sales agent. (Advertise and
interview from the leading sales agents register in the UK)
o Monitor and manage sales progress.
o Mostly commission-based to minimise risk and
exposure.

What Next?
▪ UK ICT Market: Key sectors; market
conditions; regulations.
▪ Opportunities: UK, Europe and beyond.
▪ How We Can Help: Positioning; information;
access to market; marketing; sales.
▪ First step in an ongoing dialogue. We are
ready to engage. Over to you!

Q & A
W www.bridjes.com E info@bridjes.com
T +44 (0)20 7078 7648 M +44 (0)79 0176 5917

EiTESAL event UK Market challenges & opportunities 18/7/2017

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