It's not all gloom and doom in the Irish technology sector and there is life in the internet yet. According to Mr Sergio Giacoletto, executive vice-president of Oracle in Europe, Middle East and Africa (EMEA), there are still opportunities for IT growth.
Oracle, one of the largest manufacturers of computer software in the world, has announced that it will operate a new internet "one-stop shop" from its Dublin offices beginning next month.
The iStore service will allow customers to purchase complex software and solutions via the internet. The decision to locate the service in Dublin is, according to Mr Giacoletto, a vote of confidence in the internet as a business channel and the Republic as a location for technology investment.
"The internet sales division in Dublin started as a typical telesales operation in 1996 but over the past 24 months we started to introduce more and more internet-based selling to the extent that the name of the operation has changed to incorporate the internet. We have implemented our own technology and have been very pleasantly surprised to see that we can do an awful lot of the sales cycle on the internet," Mr Giacoletto said.
The sales cycle can also be shortened and made less expensive, as demonstrations hosted in Dublin are brought to customers' desks irrespective of location. Using a method called "co-browsing", a client can be directed to a URL (uniform resource locator) or Web page and the sales person can talk them through a demonstration of any Oracle product over the phone. Customers who like what they see can be led through the implementation process and the product can actually be delivered in a matter of days over the internet.
"The internet model also cuts down the time to no sale. You can qualify the leads very early on. Many companies still operate incompatible systems so the marketing department has leads and telesales has something else and the field sales person has something else. We have integrated everything so that we can follow a lead electronically as it becomes an opportunity or not as the case may be," he said.
Mr Giacoletto believes Oracle's Irish office is setting an example in how to move up the value chain - a lesson other multinationals should pay attention to.
For example, because the internet sales division office sells more complex products than the average telesales department, the staff required are more experienced. Internet sales division staff must have a real knowledge of the products and must be able to hold real conversations with customers, he said.
"The cost of operating in Ireland is growing so you are no longer a cheap place to do business. As a result, you have to be a competent place to do business. The question is, how can companies add more added-value services here? We think we have one solution in the internet model, which has not been used to sell such complex and intangible products before," he said
"There are advantages for us too because we are employing people with more experience who tend to be older than the normal telesales staff. In the normal call centre scenario, there is a high attrition rate because young people want to keep moving," he said.
The Dublin internet sales division centre already represents between 20 and 30 per cent of total business sales in the EMEA region. At a time when Oracle is experiencing a contraction of software sales in the US, the EMEA region is strengthening and Mr Giacoletto believes the internet sales division is playing a crucial role in this.
"Last year in Europe our sales grew by 46 per cent. We have been growing faster than SAP for 10 quarters in a row. We are seeing a slowdown outside of the US as well now, but this is a phenomenon that everybody in the industry is experiencing," he said.
"Of course, the more we can sell over the internet and over the phone, the better it is for our margins," he said.
