SAMPLE SLIDES

Amandeep Singh
 ABC’s strategy of aggressive growth through acquisitions, alliances
and product development have propelled revenues
Product Launches
Penetrating new market segments through product diversification
French Fries
(Proposed )

BEVERAGES
Flavored Water
Entered into an alliance with XYZ Group to manufacture and distribute XYZ juices in the UAE, Oman, Qatar, Kuwait and Bahrain
Enhanced Kids Water
Juices
Tea & Coffee
R
Bulk Water
ev Signed an MOU with XYZ company, XYZ, pursuing alliances in the flour and flour-related products, in Nov 2007
Bottled Water
en The tomato paste manufacturing unit of XYZ in XYZ – first outside XYZ, started production in May 200
ue FRUITS & VEGTABLES
(A Tomato Paste
Fruit Puree
Entered intoEan importation and distribution agreement with XYZ brand XYZ Tea & Coffee in Jul 2007
Frozen Vegetables
D
Mi FLOUR & FEED
Feed & Flour
lli Acquired XYZ Vegetable Processing and Canning Factory in Jan 2008
on
s) Acquired XYZ - an Abu Dhabi-based five gallon water brand, in Oct 2007

Listed its shares on XYZ Securities Exchange in May 2005 Organic Growth
Organic + Inorganic Growth
Incorporated as XYZ Foodstuff and Mineral Water Company
Ye
ar
s
 China has three public medical insurance (BMI) schemes that cover
urban employees, other urban residents, and rural residents

Public Medical Insurance Policies – PRC(1),(2) Coverage in 2009

The primary medical insurance consist of three public medical insurance policies Not Insured
Insured
Bi
lli
ntroduced in 1998 on
Available to employees of urban enterprises In
Co-funded by the employer and employee, 6% of the compensation is covered by the employer with 2%diby the employee
mployee Basic Medical Insurance (UEBMI) vi
du
al
s

§Introduced in 2007
§Co-funded by personal contributions and government subsidies - based on local living expenses
§Eligible recipients, including children, students and unemployed urban residents not covered in the UEBMI
esident Basic Medical Insurance (URBMI)
Share of XX% YY%
Population
UEBMI
Policies NRCMS
URBMI
ugh a pool of funds generated from a minimum government spending of RMB 40 per capita and individual contributions of RMB 10 per person annually
ms is very limited Share of XX% YY%
ral Cooperative Medical System (NRCMS) Insured (96% in eastern
regions and 90% in
central and western
regions)

Source:
(1)Health Insurance Development in China, The American Chamber of Commerce, Dec 2009, http://www.amchamchina.org/article/5363
(2)Rural medicare plan benefits 370 mlnChinese, China Daily, Dec 2008, http://www.chinadaily.com.cn/china/2008-12/10/content_7292033.htm
 Despite steps to make insurance widely available, it is not expected
to have much impact on the affordability of pacemaker procedures

Urban-Rural Reimbursement Range (2007)(1),(2) Affordability(1)

80% Region Annual Per Annual Per
Capita Income Capita Savings
70% AA% Urban $XYZ $XYZ

60% Rural $XYZ $XYZ

50% BB% AA%

Pacemaker Device Price Gaps in Coverage
§The average price of a single
40% chamber pacemaker is around
Single ~ $XYZ two times the annual income of
30% Chamber an urban resident, and hence
Double ~ $XYZ- $ PQR affordability is a significant
BB%
20% Chambered barrier
§
10% Geographic Differences in
Coverage
§In Shanghai, at most $3,670 in
0% terms of the CRM device, can
be reimbursed
Urban Rural §In Hangzhou, 70% of the cost of
Healthcare Policy and Reimbursement

medical device less than $XYZ

§Reimbursement rates as a percentage of the insured amount, vary widely by location and could be reimbursed
municipality in and urban vs. rural areas §In Hubei province, only 50% of
§Even if 70% of an imported pacemaker’s cost is covered (~$ XYZ in case of single chamber ), this still the CRM device is covered
leaves a significant amount of money that must be covered out of pocket (~ $ XYZ for single under insurance
chamber). Average per capita income in Urban China is $ XYZ and thus the out-of-pocket costs of
~$ XYZ are still out of range for hundreds of millions of Chinese

Source:
1.Primary Research
2.www.emerging-asia.com/.../Medical%20Devices%20in%20China%20-%20Growth%20Barriers%20060907.pdf
3.http://www.osec.ch/internet/osec/de/home/export/publications/free.-ContentSlot-31391-ItemList-67490-File.File.pdf/BB_Marktstudie_Medical_Device_Market_in_China_070215.pdf
4
 5
(2)BA Analysis
(1)Primary Research
Source:
(A)Methodology for the calculation of (1) Number of patients going in for surgery, (2) Market size of various procedures/implants is explained in the appendix
Note:
•Estimated number of patients receiving treatment from Urologists
in a year for Male Incontinence (MI) = (Average number of patients
•Estimated Market size of the implant = visiting a urologist in a year) X (Number of urologists treating MI)
(Number of patients undergoing surgery) X
(Percentage share of the implant in the surgeries •Estimated number of patients receiving treatment from doctors
performed) X (Average Price point of the implant) (Urologists, GPs and General Surgeons) for treatment of MI =
(Estimated number of patients receiving treatment from Urologists
in a year for MI)/(Percentage share of Urologists treating MI)
METHODOLOGY
USD ( in millions)
C
B
Z A
Y
X
Millions

Z
Y
X
Z Z
Y
Y X
X
Market Size of Implants (in USD Millions)(1),(2) Market Size in Volume (Patient Population in Millions)(1),(2)
Mesh is the lowest at USD XYZM
Despite a AA% market share by volume, the market share of Hernia
 Based on primary research, all else being equal, physicians in China
prefer US and Europe manufactured CRM devices over Chinese
§“Made in China” means the product is manufactured in China
Made in China – Definition –Products which are manufactured in China are only then legally able to make such a claim

Preference for Foreign CRM Medical Devices

Europe“Brand is the more important factor when selecting a CRM device. The manufacturing origin doe
device.”
§Biotronic
- Cardiologist , Wuhan Jing’ai Hospital, General Hospital (Hubei Province)
§

“Yes, the country of origin is important as these devices are implanted into patients bodies for long periods of tim
implants.” China Japan/
Korea
- Cardiologist , Shandong Provincial Hospital, General Hospital
US §Japan
§Medtronic Lifeline
§St. Jude Medical. §

“If the quality is guaranteed, foreign devices manufactured locally may

Mostly Moderately Least
Preferred
usage.”
Preferred
Preferred
- Cardiologist , Yueyang Hospital, General Hospital

ces by cardiologists and the majority of patients are willing to pay more for western device brands because they perceive them as being more reliable
ary of the “Made in China” tag which is taken as a sign of a local brand unless otherwise clearly noted.
evices are well-known among cardiologists and therethink
“I don’t doesn’t seem
there to bedifference
is any any change in preference
between if theirbrand
the foreign manufacturing
productsismanufactured
local and quality
in standards
China andare
themaintaine
importe
Perceptions on Country of Origin

pacemakers.”
difference between “Made in China” and “Assembled in China”
- Cardiologist (Associate Professor) Hangzhou (Zhejiang) Hospital of Traditional Chinese Medicine, General Hospital

Source:
(1)Primary research
(2)Health-Care Reform, China Style, http://seekingalpha.com/article/151035-china-s-medical-device-industry-growing-market-new-regulations-fuel-competition
(3)China's Medical Device Industry: Growing Market, New Regulations Fuel Competition ,
6
http://seekingalpha.com/article/151035-china-s-medical-device-industry-growing-market-new-regulations-fuel-competition
Market Overview

Erectile dysfunction (ED) is a male sexual disorder and falls

under the purview of Urology(1),(2)

Urology

Kidney and Urinary Tract Sexual Dysfunction

Disorders

Male Sexual Female Sexual

Dysfunction Dysfunction

Disorders of Erectile Disorders of Disorder of Failure of

Desire Dysfunction Ejaculation Orgasm Detumescence(A)

Erectile dysfunction (ED) is persistent inability to attain and maintain an erection sufficient to
permit satisfactory sexual performance(1)

Note:
(A) Failure of detumescence is a prolonged erection usually lasting for four hours or more. It is painful and always unaccompanied by sexual desire despite the
fact that it is often preceded by usual sexual stimuli.
Source:
(1) Erectile Dysfunction, National Institute of Health, http://kidney.niddk.nih.gov/kudiseases/pubs/impotence/
(accessed February 5, 2008).
(2) Male Sexual Dysfunction and Methods used in Assessing Medicinal Plants with Aphrodisiac Potentials,
Pharmacognosy Reviews, http://www.phcogrev.com/issue1/6.pdf (Accessed February 05, 2008).

7
Market Overview
The U.S. oral PDE5 inhibitor drugs market is expected to grow
from $ YYY M in 2006 to $ ZZZ M in 2011 at a CAGR of XX%
PDE5 Inhibitor ED Market (2004–2012)(1)

CAGR XX% CAGR YY% CAGR Viagra Levitra Cialis

2004–
XXX -XX% YY% ZZ%
XXX 2006
XXX 2006–
XXX AA% BB% CC%
XXX 2011E
XXX
XXX Insights
XXX

•After intense marketing campaigns and

spendings of Viagra, Levitra & Cialis to
reach out to target population, the market
penetration levels in U.S. ED will experience
moderate growth due to lackluster growth in
the no. of ED prescriptions
•Removal of insurance cover is estimated to
save Medicare/Medicaid $ 690 M for the
next 5 years which will definitely affect the
market sales
•Fierce marketing battle with Levitra and
Cialis will result in flat sales of Viagra

Increase in number of patients Popularity of PDE5 inhibitors among patients seeking ED treatment
Drivers seeking ED treatment

Inhibitors Lack of insurance cover Drastic side effects

Note:
(A) Sales from generic drugs have not been included.
Source:
(1) Therapeutic Categories Outlook, October 2007, via Thomson Research (accessed December 14, 2007).

8
Advertising Landscape
Although Drug C is a better product in terms of duration of action,
Drug A’s branding is better than that of its competitors(1)
Comparison of Brand and Product Attributes
Strongest

Weakest
Drug A Drug B Drug C

Recognition Strong brand value of Intense promotion at the Intense promotion

XXX time of launch at the time of launch

First in the market Second in the market Third in the market;

Launch three months after
Brand

Drug B’s launch

Highly effective sales Strong sales and Strong sales and

Sales and Marketing strategies and marketing Marketing capabilities Marketing capabilities
campaigns
Very high DTC spending High DTC spending at High DTC spending
DTC Spending since launch launch; reduced in In first two years
2005–2006 Reduced in 2006

Effect lasts for four hours Effect lasts for four hours “36-hour window”
Duration of Action

Onset between 14 to 20 Onset between 20 Onset between 16

Time to onset of action minutes to 30 minutes to 20 minutes
Product

Least potency among all Highly potent Comparable potency

Potency to Levitra

Drastic side effects Drastic side effects Drastic side effects

Side effects observed in some observed in some observed in some
individuals individuals individuals

Contraindications Contraindicated with few Contraindicated with Contraindicated with

medications few medications few medications

Source:
(1) Boston Analytics Research.

9
 Market

Though rural India is still untapped, the top companies may not
leverage the opportunity in a major way in next five years
Refrigerator Sales by Region (in percent, 2009-2015)(1) Urban-centric Sales and Penetration
§Consumer durables in India are highly urban centric and
2009 have really low penetration levels in rural areas
Refrigerator W 2015 §
I §The penetration of refrigerators at an all India level is still
P ≈XX% and is expected to reach YY% by 2015
2009 –In urban areas, it’s AA% and will reach BB% in 2015
Frost Free –In rural areas, it currently stands at AA% and is
W 2015 expected to be BB% in 2015
I
P –
§Given the relatively low penetration levels, future growth
2009
Direct Cool in the rural market is expected to accrue more from
W 2015 fresh DC sales while growth in the urban market will be
I
derived predominantly from product upgrades to FF
Rural P Urban

ortunity, MNCs are expected not to diverge their focus majorly in next 5 years and will continue to drive the sales from urban areas till these get saturated
(1),(2)
Refrigerator Penetration (in percent, 2009-2010)

2009 2015

AA% AA%
Households

XX% YY%
“In next five years, rural markets will definitely grow but the magnitude of change wont be big enoug
sales”

BB% BB %
“The penetration levels will rise but not drastically because the population is al
Rural Urban steadily”
- Area Sales M

Source:
(1)Primary Research
(2)Durables makers to invest Rs 1,000 cr, IBEF, http://www.ibef.org/artdisplay.aspx?cat_id=60&art_id=23158
10
 Market

South will lead in overall refrigerator and FF segment sales but

North and West offers highest growth in DC and FF segment resp.
Refrigerator Sales by Zones (2009-2010)(1) Direct Cool Refrigerator Sales by Zones (2009-2010)
North West South East

XX% YY% XX% YY% XX% YY% XX% YY%

X Y
X Y
% %
Frost Free Refrigerator Sales by Zones (2009-2010)

North West South East

X Y X Y
X Y X Y
% % % %

2 W 2 W 3 W 1 W
5 I 5 I 7 I 3 I
% P % P % P % P

X Y 2009 2015
Overall Overall
X Y
% % §Region-wise, South India was the leading revenue earner §In next 5 years, the zonal split isn’t expected to vary much
for the industry in 2009 §South will still hold the majot share of sales
–The warmer weather of the South requires a refrigerator
running throughout the year Direct Cool
§The demand is also higher in the northern and western §The contribution of North will further grow in DC segment
parts of the country than in the east –The main reason being the high rate of illiteracy and low
astest in frost free segment for the next 5 years, and it has the growth potential for direct cool segment as income groups based in north
Direct Cool (DC)
- Regional Frost Free
Marketing Manager, Samsung
§North and East are the biggest markets §South will continue to dominate the FF segment especially
Frost Free (FF) in the high end FF range
§South dominates in the frost free segment §West will pick up the incremental sales volumes and show
–Far affluent customers are based in South the highest growth for the FF segment also
§South and West recorded more sales in premium FF –Fast economic growth, high rate of urbanization and
segment than the industry volume driver DC segment more organized retail network will lead West to this
§The sale of low-end FF refrigerators has started to pick up §North will see growth as FF refrigerators are viewed as
in the West more of a status symbol there
Source:
(1)Primary Research 11
 Sugar
Overall Chocolate
Confectionery

In terms of price point, Company B appears more focused on lower

price points where as Company A has a strong presence across
almost all price points
Price Point Landscape–Chocolates (2007)(1)
Top 3 companies
Presence of Brands

Company A has gems priced at Re 1Company B has a unique price point offering at Rs 6 and 7 in Chocolates

Company A
Company B
Company C

Key Points
INR 1 INR 2 INR 5 INR 6–7 INR 10 INR INR INR INR > INR 100
11–15 16–25 26–50 51–100 nTablets and countlines
which represent over 85%
26 of chocolate market are
available across all price
21 point s
Number of Products

20 nCompany B has
18 concentrated its product
competition with sugar confectionery products priced at INR 1 and INR 2 14 portfolio on lower price
12 points
11
nCompany A is present in
12 almost every price point
3 category, but has greater
1 2 density at high price
probably given their focus
on gift giving boxes

Price Points
Source:
(1) India., Euromonitor (Hershey provided document).

12
 Company Overview Global Presence
The ABC group is a multinational organization offering fluid
power solutions in five continents

OLAER Group: Organizational Structure and Geographical Spread(1)–(3)

Geographies Served Organizational Structure

Brands
Brand 1 Brand 2 Brand 3 Brand 4
•France •Swede •USA •U
(Headquarters) n K
•Italy
(Headquarters) (Headquarters)
•Spain •Denmar •I
•Czech k n
Republic •Finland d
•Austria •Norway i
•Slovaki •Poland a
a •A
•Switzerl u
and s
•Germa t
s 500 employees are present in five continents ny r
•Belgium a
•Romani l
a i
Countries covered •Hungar a
y •S
•Netherl o
ands u
The ABC group, headquartered in the UK, is organized into four different brands depending on
•Korea the t
countries of operation •China h

A
Source:
(1)Primary Research.
f
(2)OLAER Worldwide, OLAER Australia, http://www.olaer.com.au/contact/worlwide_map.htm (accessed March 25, 2008). r
(3)Olaer Worldwide, Olaer Germany, http://www.olaer.de/ (accessed April 03, 2008). i
c
Private & Confidential 13
13 a
 Services across the value chain can be repositioned at multiple locations with
varying control to increase the cost-efficiency of sourcing

What is Outsourcing?(1) Scope of External Sourcing across Business Value Chain(A),(B)

1 2 3 4 5 6 7
Back office
Manufacturi Maintenance,
R&D/ Operations
Design & ng Customer Sales and
Intellectual and
Consulting, Engineering and Service Marketing
Property Supporting
Assembly
ntifying, acquiring and managing the receipt of sourced services from an external service provider. Installation, and Support Activities
Integration
cing services through the most cost-efficient method which may also take the form of off shoring to a low-cost destination through aand captive unit)
nManage nDevelop nSet up, nNeeds nService nSales nActivity-based
R&D business tooling, lay Implementatio
assessment provisioning forecasting costing
portfolio plans out, design nClient nrequire- nSoftware nAdvertising nProcure-ment

Illustrative List
nConceptual- nDefine planning ments updates nField sales nPayroll
izeresearch production nInventory definition nCall centers nAccount nAccounting
projects requirement manage- nSoftware nHelp desk manage- nIT department
nTest concept s ment customiza- ment nBilling,
feasibility nIdentify and nSafety, tion nLead invoicing
hain, opportunities for sourcing services from external providers exist across all stages of business
manage security nSystems generation and
processes(B) strategic reporting integration collections
partnerships

Prioritization Matrix for Sourcing Services(2)

ee crucial dimensions to determine the most cost-effective mode of partnership

L Offshore
Evolution of Global Outsourcing Industry

their value chains in order to first identify processes that can be sourced from alternative locations
o
required to execute these processes effectively. For e.g., a financial institution may run offshore operations through 3 using a third party vendor
Neara captive outfit instead of
ify opportunities of massive cost reductions if shifted to low-cost locations
ca shore
HHHti
o Onshore
2 1
n Th
i
Pa rd Knowledge
rty Hy Services
b r id Business
apt C Process
Note:
ive IT
l
Services
(A)Activities under each stage are illustrative an not comprehensive.
ro

Pr
Low-cost sourcing could be of several genres including onshore/offshore outsourcing, off shoring through captive units, etc
nt
(B)Illustrative representation of process which can be outsourced. Services

o
o

ce
C
Source:

ss
(1)BA Analysis
(2)Time to Go East? An outlook for IT and Business Process Offshoring in Eastern Europe, June 2006, McKinsey & Company, http://www.mckinsey.com/locations/warsaw/files/pdf/EESTCOM_report_final.pdf
(accessed on July 21, 2009).
14
 Just as the success of ITO paved the way for the growth of BPO, the
growing maturity of the BPO led to the development of KPO

Roadmap of Outsourcing Industry

Years
Before 1990 1990 1995 2000 2005 2010
Low

Arrival of
Rise of KPO Expansion of
O western
vendors KPO vendors
KP captives
(Phase II) (Phase III)
(Phase I)
tently following the offshore model of the ITO industry, with a time lag of ~10 years

Arrival of
Maturity

Rise of BPO Expansion of BPO vendors

O western
vendors BPO vendors surpass captives
BP captives
(Phase II) (Phase III) (Phase IV)
(Phase I)
Evolution of Global Outsourcing Industry

Arrival of Expansion of ITO vendors

O Rise of ITO vendors
western captives ITO vendors surpass captives
IT (Phase I)
(Phase II)
(Phase III) (Phase IV)

High

Source:
(1)KPO: Make or Buy, Evalueserve.
(2)“Bridges without Borders” – International Trade Centre, http://www.intracen.org/servicexport/pdf/Ghaha-2007/07Nov07/KPODemand_071107.pdf (accessed July 21, 2009).
(3)The Evolution of BPO in India, A PWC Report, http://www.pwc.com/images/tech/BPOinIndia.pdf (accessed July 21, 2009).
(4)Understanding the evolution of Outsourcing, Zinnov Management Consulting, http://www.zinnov.com/presentation/evolution_India_BPO.pdf (accessed July 21, 2009)
15
 KPO services yield higher business value and involve the outsourcing
of core business functions

Transition—BPO to KPO(A),(1),(2) Evolution of KPO Services(3)

Business
Value

KPO
ive nature of KPO services is reflected in its higher business value compared
nThe gamut toof that
KPOofservices
BPO services Next wave
has constantly been evolving and increasing in size since of services(B)
its inception
nThere is a growing universe of smaller players that often specialize in niche, high-end services

Bi
Z lli
R&D, simulation services, engineering design services
above ng
Customer Support R
at
Telemarketing es
Insurance Claim Processing (in
X–Y
Legal services(C) , content development animation services, pharmaceutical research, automotiveGdesi
A/R Management BPO B
Services P)
Emergence of Knowledge Process Outsourcing

Medical Transcription
A–B
Business and market research, financial research, data analytics, software development
HR Data Processing

Rule-based Judgment-based 2000 2004 2008 2012

Work Work

Note:
(A)A representative set of BPO services is shown.
(B)Research for the next wave of KPO services is part of the primary research study planned for Phase II of the project
(C)Billing rates of attorneys can range upto 90 GBP for legal services such as drafting legal contracts and negotiations
Source:
(1)Knowledge Process Outsourcing Market and Opportunities, IBEF, http://www.ibef.org/download/Knowledge_Process_Outsourcing_170708.pdf (accessed July 21, 2009).
(2)“Bridges without Borders” – International Trade Centre, http://www.intracen.org/servicexport/pdf/Ghaha-2007/07Nov07/KPODemand_071107.pdf (accessed July 21, 2009).
(3)Knowledge Process Off-shoring – The Next Big Opportunity, http://www.intelligentcommunity.org/clientuploads/PDFs/Aggarwal.pdf (accessed July 21, 2009).

16
 Data-driven services account for approximately AA% of the KPO market in India
with ‘data search, management and analytics’ segment contributing the most

Market Share by Type of KPO Services in India

Data-driven Services Market in India (2009)
(2009E)(A)
Segment Market Size (£
£ YY B
AA%
(B)
BB% Legal Services XX
CC% Business and
(A)
Consulting Research XX
Technology- DD%
Market Research XX
drivenand Data-driven
Other services, YY%
Services, XX% Financial Research XX
EE%
£ ZZ B
= £ XX B
= £ YY B
Data Search,
Segmentation of Indian Market by Type of Service Area

Data-drivenservices Management and XX

Analytics(B)

100% = £ AA B

Focus of Study

Note:
(A)India market size is the pessimistic market value.
(B)Includes Financial Analytics.

Source:
(1)BA Analysis
(2)Indian KPO – How to capture the potential?, An Evalueserve Report, http://www.sibc.se/uploads/Downloads/KPO%20-%20A%20Win-Win%20Situation.pdf (accessed on July 21, 2009).
(3)India’s Knowledge Process Outsourcing (KPO) Sector: Origin, Current State, and Future Directions - Whitepaper by Evalueserve on July, 2007,
http://www.ibef.org/download%5CIndia%27s_(KPO)_Sector_6May_08.pdf (accessed on July 20, 2009).
(4)Knowledge Process Outsourcing – Markets and opportunities, IBEF Report, http://www.ibef.org/download%5CIndia%27s_(KPO)_Sector_6May_08.pdf (accessed on July 20, 2009). 17
17
 India remains the most attractive market among the alternative KPO
destinations accessible to western markets
Assessment of Relative Attractiveness(1-
Comparative Analysis of Geographies(A) 3)
Leader Emerging Countries
Country Weights India China Philippine Russia Eastern Latin
High 4
s Europe(B) America(C)
Scores
Parameters

Location Attractiveness
3
Current Availability 0.25 3.5 2.5 1.5 1.5 1.5 1.5 Latin America India
of Talent (P1) China
Capabilities of Workforce

Philippines
Ability to meet 0.25 2.5 2 1 1 1 1
Future Demand (P2) 2 Russia Eastern Europe(A)
English Proficiency 0.25 4 1 3.5 1 2.5 1
(P3)
1
Skill Level (P4) 0.25 3 1 2.5 1 3 1.5

Total Weighted 1.00 3.26 1.63 2.14 1.13 2.01 1.26

Score (WS1)
0 1 2 3 4
Comparative Analysis of KPO Destinations across the Globe

Cost Arbitrage (P5) 0.50 3 3 3 2 2 2.5

Low Capabilities of Workforce High
Location Attractiveness

Quality of 0.20 2 2 2 2 2.5 3

Infrastructure (P6)
Political/ Business 0.15 2 2 1 2 2 3
Stability (P7)
Government 0.15 3 3 3 1.5 1.5 3
nIndia: Leads the market whereas China, Philippines, the Czech Republic, Poland, and Hungary markets continue to evolve
Support (P8)
China: Weak
n
Total Weighted 1.00 English
2.65 language
2.65 skills and
2.50limited 1.93
availability2.03
of suitable talent
2.75 are the key hurdles faced by Chinese KPO industry
nEastern Europe: Shares cultural affinity with western European companies and there are language synergies but the time zone is not best suited for US clie
Score (WS2)
nRussia: Faces stiff competition from eastern Europe countries to serve the western European client base and government regulations are currently not very

Note: 1 = Low 4 = High

(A)Total weighted score (WS1) = (P1 X respective weight) + (P2 X respective weight) + (P3 X respective weight) + (P4 X respective weight)
Total weighted score (WS2) = (P5 X respective weight) + (P6 X respective weight) + (P7 X respective weight) + (P8 X respective weight)
(B)Includes The Czech Republic, Hungary and Poland.
(C)Includes Mexico, Brazil, and Chile
Source:
(1)Global Demand for Knowledge Process Outsourcing, International Trade Centre, http://www.intracen.org/SERVICEXPORT/pdf/Ghaha-2007/KPO_GlobalDemandStudy.pdf (accessed on July 16, 2009).
(2)Knowledge Process Outsourcing, KPMG, http://www.in.kpmg.com/TL_Files/Pictures/KPO.pdf (accessed on July 16, 2009).
(3)“Bridges Across Borders” Fostering Outsourcing Partnership in Financial Services & Information Technology, ITC, http://www.intracen.org/servicexport/pdf/Ghaha-2007/07Nov07/KPODemand_071107.pdf (accessed on July 16, 2009).
18
 The F&B industry can be segmented into four distinct operating
segments that differ significantly in the levels of value addition

Operating Segments within the F&B Industry

XXX currently has a strong presence in the commodity business and aims to strengthen its presence
segments
AGTHIA

DANONE

PEPSICO (Beverages)

NESTLE

KELLOGG’S

HANSEN YAKULT

GENERAL MILLS
Operating Segments in the F&B Industry

CONAGRA

BUNGEE

CARGILL

Commodity Processed Packaged Innovation

Value Addition

19
 With the expansion of the product portfolio into higher value-added
segments, more options for organization structure become viable
Value Addition/Level of Sophistication
Commodity Processed Packaged Innovation

Functional Head Office

•In-depth knowledge and skill
development
Marketing Mfg Sales •Economies of scale in functional areas
•Clear-cut goal setting
•Best with few product lines
Category 1
•Decisions may pile on top
Category 2 Support Functions •Poor horizontal coordination
•Slow response to change
Category 3

Head Office
Divisional Head Office
(Product Segment) •Responsive to markets
Geography 1 Geography 2 Geography 3 •Tight coordination between functions
Category 1 Category 2 Category 3 •Can adapt to products, regions, clients
Category 1 •Decentralizes decision making
Sales
Geography 1 Sales •Best for multiple product lines
Category 2 Procurement
Geography 2 Marketing •Eliminates functional depth
Category 3 Supply Chain •Poor coordination across product
Geography 3 Supply Chain lines
Support
Support Functions
Functions

Hybrid Head Office

(Market and Function) •Functional disciplines are centralized to
ensure greater collaboration,
Geography 1 Geography 2 Geography 3 coordination and
communication throughout the business
Organization Structures

•Quick establishment of best practices

Category1 Sales in these essential
disciplines
Category 2 Marketing
•Local responsiveness is lost
Category 3 Supply Chain •Coordination issues

Support Functions

20
 The strategic focus area will guide the structure, processes and
competencies required
KEY
IMPLICATIONS
Structure & People
nCentralized decision-making
nTightly linked product supply,
customer service, and
demand management
Cost Focus
Strategic Focus Area
nNon-traditional structures
nLow bureaucracy
Customer Focus
nDecentralization
nCreate learning
organization
Organization Restructuring
n nEfficiency
Product Focus n n
21
Processes
nStandardized Processes
nLow overhead
nUse technology as an
enabler
nNo frills products/services
nCross-functional teamwork
nVisibility
nEducate customer
nFoster Innovation
nDevelop strong product
pipeline
Competencies
nLean Operations
nStandardized Quality
nCustomer service
nMarket research
nProduct/service delivery
nHighly trained sales and
service force
n
n
nUnderstand customer
requirements
nNew and Innovative
product development
 Benchmarking—Data Gathering
hmark Data Providers
Operations
Procurement Manufacturing Sales & Marketing
hmarking data was gathered across the value chain
Supply Chain

Benchmark Data Sources

Primary
Research Primary Research
Phone Calls, Emails, Interviews, Surve

Benchmark Secondary
Corporate
Research
Websites, Industry Associations, Re
Data

Secondary Research

From globally
Benchmarking
recognized
Data
Benchmark
ProvidersService Providers, Privat

22
 sed
ed Benefits
Benefits of
Sales—Evaluation of Centralization

Outcome
Outcome
Roles
Roles

of Centralization
Effectiveness
Effectiveness Efficiency
Efficiency

Centralization
Execution Execution Cross- Scalability Standardiza- OH
Speed Quality learning tion Reduction

Category
Category Management
Management Low Low High Low Low Medium

Portfolio
Portfolio Expansion
Expansion
within
within Customer
Customer High Medium High - Medium High
Accounts
Accounts

Reach
Reach (More
(More Customer
Customer High Low - Medium High High
Accounts)
Accounts)

Sales
Sales Forecasting
Forecasting Low - - - High Low

Merchandising
Merchandising Low Medium High - High Medium

Trade
Trade Marketing
Marketing Low Low High High High -

Credit
Credit Grant
Grant &
& Medium High - - High Medium
Collection
Collection

Competitor
Competitor Analysis
Analysis - High High High High High
Functional Design

Most functions in sales point towards need for centralization

23
 Sales—Transition to Centralization

Transitional
Transitional Levers
Outcome
Outcome
Roles
Roles

Levers(A
Risk
Risk Cost
Cost Difficulty
Difficulty

nCentralization of

(A))
Portfolio
Portfolio Expansion
Expansion sales/co-ordination
within
within Customer
Customer will be difficult to
Accounts
Accounts achieve given
varied nature of
portfolio
Reach
Reach

nHigher risk due to

Trade
Trade Marketing
Marketing different product
categories and co-
ordination failures
Credit
Credit Grant
Grant &
&
Collection
Collection

Competitor
Competitor Analysis
Analysis

an training and development of the sales team to sell the varied product categories. The same will require upfront investment in sales tea
dit collection and competitor analysis will be negligible from sales point of view
Functional Design

Note:
(A) Risk—Risk of implementation, Cost—Cost of Implementation, Difficulty—Difficulty in Transition.
24
 Sales—Assessment of Transition to Centralization

Transitional
Transitional Levers
Outcome
Outcome
Roles

Cons
Roles

Pros

Cons
Pros

Levers(A
Risk
Risk Cost
Cost Difficulty
Difficulty

nLower overheads in nLevel of focus/efforts

(A))
sales Team required on category
Category
Category nPiggy backing weak might be compromised
Management
Management categories on strong due to divergent
ones incentives of first line
sales team

nConsolidated nMultiple business/

Merchandizing will be functional interface will
Merchandising
Merchandising comprehensive and constrain the speed of
efficient operations

there would be need of extensive training and monitoring system that needs to be in place before the same sales people can be required
implementation
Functional Design

Note:
(A) Risk—Risk of implementation, Cost—Cost of Implementation, Difficulty—Difficulty in Transition.
25
 Emerging alternatives consider the synergies in different role for
sales as well as transitional constraints
Emerging
Emerging Alternatives
Alternatives Benefits
Benefits Concerns
Concerns
A
nSales function to be consolidated along the nConsolidated sales to key nRisk of in-efficient negotiations
product/business groups(A)
(A) accounts to reduce overheads as an aftermath of
nKey account information and and enable better category consolidations
negotiations to be held through a penetration within customer nCertain categories might not
centralized coordinating agency account get adequate attention,
nCompetitor tracking to be coordinated
n especially during their
centrally by the coordinating team launch
n

Group/Business Group

Sales Coordination Department

Business Unit
(Centralized)
üKey Accounts of Business Units
–Category Management
–Portfolio Expansion
–Information Tracking Sales
–Negotiations üSales Forecasting
üCompetitor Tracking üReach Expansion
üTrade Marketing
CONSOLIDATED SALES üMerchandising
üCredit Grant & Collection
Functional Design

PRODUCT GROUP FOCUSSED

SALES
Note:
(A) Product /business groups would be for instance: Beverages /Packaged foods/frozen foods etc.
26
 “Communication” as a segment of social media represents the
most common type of social media format
Audio/Video
High Bandwidth

gni t sac do P

gni r a h S oi du A
Low BandwidthBandwidth Required

Image

s gol B
st e gdi W
s dee F SS R

gni r a h S oe di V

s dl r o Wl a ut ri V
gni ma G e nil n O

gni kr o wt e Nl ai c o S
si ki W
sr ett el s we N

gni kr a mk oo B dna s we Nl ai c o S

gni r a h S e ga m
I

s mur oFt e nr et nI
Text

s gol b- or ci M
gni r a h S oi du A
Information Feeding Collaboration Communication
(B)
Low Medium High
Level of Interaction(A)

High Prevalence Medium Prevalence Low Prevalence

Note:
(A)Level of interaction is indicates the involvement that is necessitated from both the creator and the consumer
(B)Note: While many do not consider Information Feeding a form of social media because it typically involves one way communication, many firms including the CDC refer to it as a form of
Social Media 27
“Communication” related social media formats have grown
significantly since 2001, even though they were introduced in
1990s
Illustrative
RSS
RSS Feeds
Feeds 4RSS
Information
Information
Feeding
Feeding

Widgets
Widgets 4Trivia blitz

Podcasts
Podcasts 4Podcasts

Social
Social bookmarking
Collabo-

bookmarking 4Delicious 4Digg 4Mixx

Collabo-
ration
ration

Wikis
Wikis 4Delicious
4Flickr, Photobucket,
Image
Image Sharing
Sharing 4Ofoto 4Fotolog Picasa
Audio
Audio Sharing
Sharing 4Last.fm, Rhapsody

Video 4YouTube, Metacafe,

Video Sharing
Sharing
Communication(A(A))

Dailymotion, Veoh
Communication

Online
Online Gaming
Gaming 4Miniclip 4Yahoo Games

Blogs
Blogs
4Blogger, Livejournal 4Wordpress, Yahoo!
360º
Micro-blogs
Micro-blogs 4Twitter, Jaiku 4Plurk, Yammer,
Ping.fm
Social
Social Networks
Networks 4Classmates, Sixdegrees 4Friendster, Ryze 4Facebook, Orkut,
Myspace, Linkedin
Virtual
Virtual Worlds
Worlds 4Cybertown, Whyville 4The Sims Online, Muse 4Second Life, Disney
Toontown, Dreamville
Examples

1990s 2000–2002 2003–2005 2006–2008

Note:
(A)For details, please refer the appendix Timeline (B)
(B)Please note timeline is not to scale 28
The most commonly used criteria to measure the success of a
social media initiative is “engagement level” since it is the
easiest and fastest to track
Mostly Commonly Used
Downloads (Podcasts)
Engagement Readership/Following (Blogs, Micro-
Engagement
(A)) Levels
(A blogs) (Video Sharing)
Views
Levels
Friends (Social Networks)
Subscriptions (Newsletters, RSS feeds)
Quantitative
Quantitative

Percentage of target audience

Evidence-
Evidence- experiencing improvement in actual health
Based
Based
Impact or healthy behaviors (increased visits to
Impact
doctor, decrease in smoking, etc.)
Success
Success
Measurement
Measurement
“Engagement with social media is poorly
understood and measured. The success is
measured by the outcome of the initiative.
Content type and quality of feedback People take the easy approach of measuring
Qualitative Response received (feedback related to impact, the success by number of hits or views”
Qualitative Response
impression on one’s life, effectiveness/ease —Ex-Deputy Administrator, EPA
of use of the social media format, etc.

Summary
Summary
4The
4 The success
success of
of social
social media
media initiatives
initiatives should
should be
be measured,
measured, in
in aa true
true sense,
sense, by
by calculating
calculating the
the percentage
percentage of
of engaged
engaged target
target audience
audience who
who actually
actually
implement
implement the
the message
message in
in their
their personal
personal life
life and
and this
this implementation
implementation positively
positively affects
affects their
their health
health behavior
behavior
4However,
4 However, most
most organizations
organizations measure
measure engagement
engagement levels
levels (subscriber/reader/viewer
(subscriber/reader/viewer base)
base) as
as the
the only
only measurement
measurement of
of success
success given
given the
the ease
ease of
of doing
doing so
so
and
and the
the fact
fact that
that itit represents
represents aa proxy
proxy for
for affect
affect
4Few
4 Few organizations
organizations use
use qualitative
qualitative feedback
feedback to
to judge
judge the
the success
success of
of social
social media,
media, because
because they
they either
either lack
lack the
the resources
resources or
or the
the techniques
techniques to
to do
do so
so
4CDC
4 CDC is conducting pilot studies through survey of sample audiences to collect the evidence-based data on the proportion of target audience, whose health
is conducting pilot studies through survey of sample audiences to collect the evidence-based data on the proportion of target audience, whose health
or
or health
health related
related behavior
behavior has
has positively
positively impacted
impacted via
via the
the social
social media
media initiative
initiative

Note:
(A) An “Engagement” is an act of consuming the content created by public health organizations on the social media platform. For
example, reading a blog or viewing a video can be described as an engagement
29