CAIRO: When Summit Technology Solutions entered the Egyptian IT market five years ago, they were greeted with a boardroom nightmare. A young and fractious industry had yielded a phenomenon known in marketing terms as brand cannibalism.
The Orascom IT Group, who jointly manages Summit with the Japanese multi-field behemoth Sumitomo, had a flock of IT companies under its wings at the time. But because they were fresh to the game, the firms had divided by supplier rather than specialty – that is, one company might have contracted with Cisco and another with IBM, making two separate bodies. The disorder was such that partners were occasionally competing with one another.
It was clear that we needed to have structure, Magda El Sabee, the firm’s chairman, told Daily News Egypt during an interview last week.
Around that time Sumitomo, which opened in Egypt nearly half a century earlier developing telecommunications and power generation for the government, was looking to expand into the regional IT market. We anticipated deregulation, Yoshiaki Benino, the chief executive for the Japanese side of Summit, said. We thought at the end of the 20th century and after 2000, once the government deregulated the telecom sector, IT will be booming here.
Though Sumitomo is an old and varied company with arms in communications, energy and real estate, among many other fields, they had no IT experience in the area and wanted a local partner.
After a few rounds of merging, acquiring, shuffling and incorporating, Summit was born, the four original Orascom-linked companies eventually becoming the five the company now holds. The new company s function is to coordinate, bring together diverse and possibly conflicting bodies and make them get along well enough to deliver a cohesive set of goods and services.
Each of the five companies occupies a different niche. Qemmah, for instance, is a business consultant with projects in Saudi, Yemen and Syria, whereas Orascom Telecom handles mostly call centers, in countries as far-flung as Bangladesh and Algeria.
There were difficulties making everyone to get along at first, El Sabee said. Not every one of the old firms was immediately willing to work together and accept the fact that they were “no longer an island, she said.
Then there was the culture, not just across firms, but across continents. Obviously the way of doing business is different [in Japan and Egypt], El Sabee said. “Coming 10 minutes late to a meeting in Egypt, it s ok, it s almost normal practice. To the Japanese, it s an insult and a lack of respect.
Sumitomo has over 160 offices across the world, and they realize the Japanese way of working is not nearly as ubiquitous as they are, Benino said. For instance, there is almost never an employment contract, and rarely a job description in Japan – standards which would be hard to maintain here or in Europe. Thus they often end up blending their practices with those of the local culture, he said.
As Summit pursues its goal of becoming one of the biggest three IT firms in the region, one of its most robust businesses is designing and selling call centers, which makes up about a fifth of its operations, El Sabee said.
The Egyptian government has played up call centers recently as one of the industries that can grow the country’s supply of white collar jobs.
In a recent report, XMG, a global information and communications technology (ICT) research and advisory firm, said Egypt is becoming a key player in the global outsourcing industry, which “is expanding globally to reach $297 billion and expected to reach $450 billion by 2010.
In a statement to the press commenting on the report, Tarek Kamel, minister of communications and information technology, said, “Fostering Egypt’s position on the global IT exports map and capitalizing on the local ICT sector to boost socioeconomic development are two priorities of the Egyptian government.
Last year, an A.T. Kearney study ranked Egypt the 13th most attractive destination to set up offshore service for activities like information technology, business process outsourcing and call centers.
But while Egypt has potential in its big population and many university graduates, there is a big gap between what market requires and what those universities provide, El Sabee said, echoing a complaint common among bosses of skilled labor enterprises here.
To remedy this, Summit does a lot of training on its own, she said. Alongside the state, they set up some programs that train potential employees; the government gives some funding in return for the promise of jobs.
Most of Egypt’s competition in this area stems from India, the world’s current call center hub, El Sabee said. To this end, they will often play up the shorter time zone gap between the Middle East and Europe or the United States, Egyptians’ generally clearer accents and the number of languages they can speak – tongues like Russian, French, Spanish, Greek and, of course, Arabic are far more common here than on the subcontinent. Indians basically speak English, El Sabee said.
