Category: Press Releases

Everest Group Q1 Report: BPO deals reach three-year high, captive divestments zero for second consecutive quarter | Press Release

Report includes focus on Eastern European sourcing market

DALLAS, May 4, 2011 ─ The global outsourcing and offshoring market continued to witness steady growth during the first quarter this year, led by a three-year high for Business Process Outsourcing (BPO) transactions as well as continued investment in new captives while no divestments occurred for the second consecutive quarter, according to Everest Group, an advisory and research firm on global services. Outsourcing transactions saw a marginal decrease of five percent compared to Q4 2010 but an increase of 14 percent compared to the previous year. A one-hour Webinar will be held May 12, 9 a.m. CDT, to present study findings and insights as well as a discussion about the offshore services market in Brazil.

Everest Group’s Market Vista: Q1 2011, a quarterly report on global outsourcing and offshoring activity, reports first quarter global transaction volumes reached about US$3 billion in annual contract value (ACV). Compared to Q4 2010, the BPO market saw transactions increase by 25 percent, with adoption led by BFSI (banking, financial services and insurance), MDR (manufacturing, distribution and retail) and Healthcare verticals. Conversely, IT Outsourcing (ITO) transactions dropped 17 percent from the previous quarter.

Other first quarter 2011 findings include:

• The Public Sector vertical continued to dominate ITO transactions while the BFSI and MDR verticals contributed towards half of BPO deals signed.
• All geographies showed positive trends in the BPO market, whereas the ITO market only witnessed increased activity in the United Kingdom.
• Volume of renewals and restructured deals increased by 10 percent from Q4 2010, but ACV of the deals dropped 17 percent.
• In addition to four mega deals with contract values over US$1 billion, three of which were ITO engagements, 17 deals with contract values between US$200 million-1 billion also were recorded during the quarter.
• There were 35 new captive announcements reported, with most activity in India, followed by other countries in Asia and the Middle East.
• Offshore activity saw a decrease in location activity with 35 delivery centers established in the first quarter compared to 46 in the previous quarter. In addition to Asia, significant activity was also reported in Latin America.
• In line with the trend seen in the past few quarters, service providers’ consolidated revenues and operating margins grew in the fourth quarter over the previous quarter. (Financials lag other service provider activity by one quarter.)

“The global sourcing market continues to see steady growth in terms of transactions. Contract volumes increased by 14 percent compared to the first quarter of last year, indicating secular growth in outsourcing and offshoring activity,” said Eric Simonson, managing partner of Research. “Transactions, ACV and captives activity is reflective of the emergence of hybrid sourcing models that extract maximum impact from sourcing.”

Everest Group’s quarterly Market Vista reports provide data and analysis of deal trends in the outsourcing and offshoring market, captive landscape, current and emerging locations and key service provider intelligence insights. Everest Group’s industry trends research complements the Market Vista reports through quarterly updates focused on industry-specific global sourcing data, developments and insights across four industries (BFSI, MDR, Healthcare and Energy and Utilities).

The Market Vista Q1 report also includes these focus sections:

• Eastern Europe: analysis of labor arbitrage sustainability, operating costs, operating cost inflation, arbitrage sustainability and currency trends. Cities profiled include Prague and Brno in the Czech Republic; Budapest, Hungary; Bucharest, Romania; Sofia, Bulgaria; Bratislava, Slovakia; and Warsaw, Krakow and Poznan in Poland.
• Location optimization insights include focus on Everest Group’s reclassification of Brazil as a mature location; Uruguay’s emergence as a credible location for multi-lingual BPO support; Tier-3 cities in India leveraged by service providers to serve the country’s domestic market and the impact of turmoil in Tunisia, Libya and Egypt.

Quarterly Market Vista reports comprise key developments among 20 leading global service providers. Traditional service provider profiles include Accenture, ACS Xerox, Atos Origin, Capgemini, Convergys, CSC, AON Hewitt, HP Enterprise Services, IBM, Dell Services and Unisys. Offshore-centric service provider profiles include Cognizant, EXL, Genpact, HCL, Infosys, Mahindra Satyam, Tata Consultancy Services, Wipro and WNS.

The Webinar will be held May 12, 9 a.m. CDT; 2 p.m. GMT Standard Time. To register, please visit: research.everestgrp.com/Events/Webinars.

Market Vista is a subscription service with four reports published per year, now enhanced to also include location datasets, Breaking Viewpoint briefings, Market Vista Primer and Global Locations Insights newsletter. For information about the Market Vista: Q1 2011 report or other research services, please visit research.everestgrp.com, e-mail [email protected] or call +1-214-451-3110.

Everest Group Webinar: Recruitment Process Outsourcing (RPO) trends and service providers to be discussed by analysts | Press Release

Analysts to discuss RPO value propositions for buyers and service providers

DALLAS, April 21, 2011 ─  Recruitment Process Outsourcing (RPO), which is rapidly being adopted as a vital component of corporate talent management strategies, will be discussed in a one-hour Webinar hosted by Everest Group, a global consulting and research firm, on April 28 at 9 a.m. CDT. The event is being held in conjunction with the release of a new research report, RPO Service Provider Profile Compendium.

Led by Rajesh Ranjan, research director, the discussion will include emerging trends, highlight challenges, illustrate the current service provider landscape and identify some possible differentiation themes for service providers. The Webinar will also help buyers make an informed decision when selecting a service provider; help service providers create differentiated value propositions in the hyper-competitive market; and help the industry advance the value proposition beyond cost and scalability to realize the full potential of RPO.

The RPO market is estimated at about US$1.1 billion, according to Everest Group’s Recruitment Process Outsourcing Annual Report 2010 – A Year of Rapid Growth and Intense Competition.

To register for the Webinar, to be held April 28 at 9 a.m. CDT, 2 p.m. GMT Standard Time, visit: research.everestgrp.com/Events/Webinars. For more information about the report, Recruitment Process Outsourcing Annual Report 2010 – A Year of Rapid Growth and Intense Competition, or other research services, please visit research.everestgrp.com, email  [email protected] or call +1-214-451-3110.

Everest Group: Significant traction of global sourcing in Financial Services BPO, yet tremendous untapped opportunity | Press Release

Global sourcing adoption growth potential nearly 15 times current size

DALLAS, April 14, 2011 ─ Global sourcing of Business Process Outsourcing in the financial services sector (FS BPO), a US$16-18 billion market comprising nearly 40 percent of the US$40 billion global sourcing market, has the potential to grow nearly 15 times its current market size to reach US$250 billion, according to a study by Everest Group, a global consulting and research firm. The report includes an analysis of market size, growth and potential of global sourcing of FS BPO across the banking, capital markets and insurance segments. Research analysts will hold a one-hour Webinar on April 19, 9 a.m. CDT, to present study findings and insights.

Everest Group’s study, Role of Global Sourcing in Financial Services BPO, includes an analysis of labor savings and other factors that have propelled FS BPO adoption into the rapid growth stage. Global sourcing of BPO in the capital markets segment represents the fastest growth area, driven by the emergence of high-end judgmental work and analytics. Insurance BPO demand is being fueled by a greater need for analytics, an increased need in the United States for healthcare services resulting from a growing customer base spurred by reform legislation, and Solvency II implementation in the European Union. BPO adoption in the banking sector is led by United States firms that are increasing global sourcing to meet fiscal performance pressures as well as address the lack of opportunity in new account acquisitions offset by loan modification servicing needs.

“BPO emerged as the key growth driver in the 2010 third-party financial services outsourcing market with nearly a 50-50 split between ITO and BPO contracts as opposed to a 70-30 split in 2008-2009,” said Saurabh Gupta, vice president, Research. “In the current economic scenario where financial services companies are facing competitive pressures and are reconsidering their cost bases, BPO across industry-specific processes in banking, capital markets, and insurance is generating much interest. Our analysis finds the medium to long-term growth outlook to be significant and robust.”

“Despite significant challenges, such as constraints in the United States associated with the Troubled Asset Relief Program (TARP) and new data protection measures in the European Union, the impact on global sourcing has been minimal,” said Rajesh Ranjan, research director and co-author of the report. “Financial services firms and service providers have adapted and properly mitigated against new and emerging challenges.”

Other study findings include:

• Most financial services companies are adopting hybrid global sourcing models by leveraging third-party service providers, captives and shared services.
• Third-party global sourcing in FS BPO is growing at 20-plus percent annually.
• Banking BPO accounts for nearly 50 percent of the overall scale of global sourcing operations within FS BPO.
• Capital markets, the fastest growing segment for FS BPO, saw year-over-year growth of 40 percent in 2009-2010.
• India, Philippines and China are mature locations for FS BPO, while Eastern Europe, Central America and South America are witnessing the fastest growth.
• In India, scale of global sourcing for FS BPO continues to grow at 20-plus percent, with growth expanding to Tier-2 and Tier-3 cities for mature services in banking and insurance.

Everest Group analyzed FS BPO capabilities of 15 service providers for each business segment. Service providers with the strongest global sourcing capabilities are Genpact, HP and TCS for banking BPO; Infosys BPO, TCS, and Wipro for capital markets BPO; and Accenture, EXL Services, and WNS for insurance BPO. Other services providers examined in the study were Capgemini, CSC, eClerx, HCL, Intelenet, Syntel and Xchanging.

For more information about the report, Role of Global Sourcing in Financial Services, or other research services, visit research.everestgrp.com, email [email protected] or call +1-214-451-3110. To register for the Webinar, to be held April 19 at 9 a.m. CDT, 2 p.m. GMT Standard Time, visit: www.everestgrp.com/category/webinars.

Additional Everest Group research reports with insights on this topic that may be of interest include:

• FS BPO Service Provider Profile Compendium
• Global Lending BPO Across Credit Cards, Consumer Loans and Commercial Loans
• BFSI (banking, financial services and insurance) Industry Trends
• The Growing Maturity of Offshore Research and Analytics in Financial Services
• Impact of Regulatory Changes on Offshoring in Financial Services

Everest Group: Procurement outsourcing market witnesses record contract signings and extensions in 2010 | Press Release

PO market expected to grow 15-20 percent this year; Mid-market adoption rebounds; 5 service providers earn ‘2010 PO Market Star Performers’ status

DALLAS, April 7, 2011 ─ The multi-process Procurement Outsourcing (PO) market will grow 15-20 percent and reach US$1.5 billion in annual contract value (ACV) in 2011, representing managed spend of about US$190 billion, according to the Procurement Outsourcing Annual Report 2011 published by Everest Group, a global consulting and research firm.

In 2010, PO adoption was driven by organic and inorganic growth as the market experienced a record year for new contract signings and extensions. Last year saw ACV grow 13 percent to reach US$1.3 billion. Cumulative total contract value (TCV) for existing and new engagements reached US$9 billion, an increase of 15 percent from 2009. Economic recovery influenced mid-market buyers, defined as companies with revenues between US$1-5 million, as adoption in this buyer group jumped 13 percent over 2006-2009 levels.

Everest Group’s PO market projections for 2011 include:

• End-of-term activity will be significant as 45 percent of PO contracts, valued at nearly US$3 billion, are up for renewal within the next three years.
• The small/medium-sized business (SMB) segment will see higher adoption levels, influenced by new platform-based offerings that include Software as a Service (SaaS) as a delivery model.
• Economic recovery will lead to increased adoption in the financial services and telecom sectors.

“Following the economic recession, we saw market recovery begin in 2010 as evidenced by a large number of new and renewed contracts and a significant rebound in mid-market adoption,” said Saurabh Gupta, vice president, Research. “We continue to see an increase in sourcing-focused contracts, driven by the need to generate quick savings, and we expect to see these contracts expand into transactional services to ensure compliance and sustainability of savings. Additionally, contracts that leverage Finance and Accounting Outsourcing (FAO) and PO synergies, especially in the procure-to-pay areas, will continue to see increased market traction.”

Other developments in the 2010 PO market included:

• The number of small-sized contracts increased; nearly 70 percent of contracts signed last year have a TCV less than US$15 million.
• While manufacturing companies led adoption, the consumer packaged goods and retail sectors together accounted for 35 percent of market share in terms of TCV.
• The United States led PO adoption, accounting for 45 percent of contracts signed, followed by Europe with 43 percent.
• Beyond procurement, buyers were increasingly interested in adjacent supply chain processes such as fulfillment and transportation and logistics management.

Everest Group’s Performance/Experience/Ability/Knowledge (PEAK) matrix classified Accenture, IBM and ICG Commerce as leaders in the PO market that together accounted for nearly 75 percent of the overall market by ACV and 50 percent of new contracts signed in 2010. Classified as major contenders are sourcing-focused providers buyingTeam, Global eProcure, and Xchanging as well as procure-to-pay-focused providers CapGemini, Corbus, Genpact, HP, Infosys, TCS and Wipro. The report also classified DSSI, HCL and HCMWorks as emerging players.

“We expect to see an expansion of the service provider landscape this year,” said Gupta. “Sourcing and supply chain advisory firms are a threat to PO service providers, FAO providers that recently entered the PO market continue to build sourcing capabilities, and mature procurement shared services are increasingly offering PO services.”

In this year’s report, Everest Group highlighted five service providers as “2010 PO Market Star Performers:” Accenture, Genpact, IBM, ICG Commerce and Infosys. These service providers demonstrated the strongest movement forward across the following two dimensions:

• Market success in 2010 based on ACV growth, number of contract signings and value of contract signings last year
• Capability advancements in 2010 based on expansion of scale, scope, delivery footprint and technology investments

The Star Performers designation relates to year-on-year performance for a given service provider and does not reflect on overall market leadership positions. Those identified as the 2010 Star Performers include both leading service providers and major contenders.

Everest Group’s analysis includes multi-process PO contracts with a minimum of three procurement processes, over US$1 million in ACV, and a minimum contract term of three years. Typically, managed spend is greater than US$50 million.

To read an extract of the Procurement Outsourcing Annual Report 2011, purchase the report, or inquire about other research services, please visit research.everestgrp.com, email  [email protected] or call +1-214-451-3110.

Everest Group: HR outsourcing market will grow 8-10 percent this year; contract activity and mid-market adoption rebound in 2010 | Press Release

Contract size and length decreased; North America remains leading adopter; 5 service providers earn ‘2010 HRO Market Star Performers’ status

DALLAS, March 30, 2011 ─ A stronger economy brought new contract activity in the multi-process Human Resources Outsourcing (MPHRO) market and a strong rebound in mid-market adoption in 2010, according to the Human Resources Outsourcing Annual Report 2011 published by Everest Group, an advisory and research firm on global services. Everest Group projects the MPHRO market will grow by 8-10 percent and reach around $3.35 billion in 2011.

Despite positive signs of increased activity with 46 new deals signed in 2010, average contract size and term length continued to decrease, largely due to a decrease in the number of processes outsourced within new deals. Last year, annual contract value (ACV) grew by US$170 million to reach approximately US$3.07 billion.

Market activity was driven by new deals as well as by several extensions. In addition to an increase in new MPHRO contracts last year over 2009, there was a substantial drop in terminations, pointing to the stabilization of deals.

“Cost reduction remains the top driver for MPHRO adoption; however, managing compliance, greater alignment between HR and business, and access to technology are increasingly important,” said Rajesh Ranjan, research director “With an improving economy, greater buyer confidence, and a more robust and healthy service provider landscape, we expect to see 8 to10 percent market growth this year. We also expect to see increased adoption by industries that have been slow to adopt MPHRO, such as insurance and technology, and continued strong adoption by mid-market buyers.”

Other report findings include:

• North America remains the leading MPHRO adopter while Europe increased its share of adoption by 33 percent. Asia Pacific, experiencing rapid economic growth, also saw an increase in deal signings.
• In recent years, the share of financial services and manufacturing adoption decreased while healthcare and energy verticals saw increases in deal signings.
• In spite of a decrease in process scope, geographic scope of MPHRO deals is increasing, particularly those signed by multi-national buyers.
• While technology continues to play a significant role within MPHRO deals, inclusion of IT components decreased last year.
• Global sourcing in MPHRO continues to increase with India remaining the most popular offshoring location; however, Southeast Asia and Eastern Europe are quickly emerging as major offshore locations.
• Mid-market buyers, strongly affected by the recession, staged a strong comeback in 2010, drawn to MPHRO for lower cost propositions as well as access to expertise to manage complex compliance requirements and technology with minimal or no up-front investment.
• Payroll and benefits are the most commonly included processes in MPHRO contracts.

Everest Group’s Performance/Experience/Ability/Knowledge (PEAK) matrix classified Accenture, ADP, NorthgateArinso, Aon Hewitt and IBM as market leaders that further strengthened their positions. Everest classified ACS-Xerox, Capgemini, Capita, Ceridian, HP, Infosys, Logica, TCS, Wipro, and Caliber Point as major contenders. Also classified in the report are emerging players Genpact, HCL, Neeyamo and Xchanging.

Everest Group also highlighted five service providers as 2010 MPHRO Market Star Performers: ADP, Accenture, NorthgateArinso, Aon Hewitt and Infosys. Last year, these service providers demonstrated the strongest movement forward across the following two dimensions:

• Market success in 2010 based on ACV growth, number of contract signings and value of contract signings last year
• Capability advancements in 2010 based on expansion of scale, scope, delivery footprint and technology investments

The Star Performers designation relates to year-on-year performance for a given service provider and does not reflect on overall market leadership positions. Those identified as the 2010 Star Performers include both leading service providers and major contenders.

“We expect to see more consolidation this year as service providers that continue to struggle to gain new clients will likely exit the MPHRO market or be acquired,” said Ranjan. “Partnerships will play a key role for service providers, particularly with regard to improving offerings in areas of global payroll, recruitment and United States benefits.”

Everest Group’s analysis includes multi-process HRO contracts with a minimum of three HR processes covering 3,000 or more employees that were signed as of November 2010.

To read an extract of the Human Resources Outsourcing Annual Report 2011, purchase the report, inquire HRO research or about other research services, please visit research.everestgrp.com, email [email protected] or call +1-214-451-3110.

Everest Group: F&A outsourcing market will grow 15-20% this year on heels of strong rebound in 2010 | Press Release

New contract TCV and renewals hit all-time highs; Service providers reporting strong sales pipelines; US$6.2 billion in contracts up for renewal over next 3 years; 5 service providers earn ‘2010 FAO Market Star Performers’ status

DALLAS, March 22, 2011 ─ The multi-process Finance and Accounting Outsourcing (FAO) market is projected to grow 15-20 percent and top US$4 billion in annual contract value (ACV) in 2011, according to the Finance & Accounting Outsourcing Annual Report 2011 published by Everest Group, an advisory and research firm on global services. In 2010, ACV grew almost 15 percent compared to about 10 percent growth during 2009, and total contract values (TCV) of new engagements reached a market-high of nearly US$5 billion, according to the study. The FAO market reached US$3.5 billion in ACV in 2010, representing about US$28.5 billion in total FAO spending.

According to the report, F&A sourcing represents a US$150-200 billion opportunity split equally across third-party service providers and captives/shared services. Current penetration of the third-party sourcing market represents only 5-10 percent of the overall potential, implying a significant value creation opportunity.

In addition to an increase in new FAO contracts last year over 2009, the market also reached an all-time high in contract extensions that, along with contract expansions, represented nearly 55 percent of ACV growth in 2010. The study predicts organic growth to continue as contracts valued US$6.2 billion or more are up for extension within the next three years.

“Last year saw a strong rebound in multi-process FAO adoption, which we expect to continue this year as buyers look to reduce costs and optimize processes,” said Saurabh Gupta, vice president, Research. “However, buyers continue to remain cautious and adopt a more phased approach rather than big-bang solutions.”

Other report findings include:

• FAO market growth continues to see strong adoption across most industries with manufacturing, financial services, retail, travel and logistics, and energy and utilities accounting for 70-75 percent of total FAO spending in 2010.
• The United States accounted for over half of total FAO spending in 2010 while Asia-Pacific witnessed the fastest growth.
• Large buyers accounted for 55 percent of contracts signed in 2010. Mid-market companies, which have revenues of US$1-5 billion annually, revived adoption of FAO last year.
• Outsourcing of accounts payable, accounts receivable and general ledger continue to be the most outsourced processes whereas outsourcing of financial planning and analysis is an emerging trend.
• An end-to-end process-driven approach to FAO is also emerging as opposed to a traditional functional and piecemeal approach. More than 50 percent of the new contracts in 2010 had end-to-end scope (Procure-to-Pay, Order-to-Cash, Record-to-Report).
• Nearly 95 percent of FAO contracts had an offshore component with maximum offshore growth occurring in Indian tier-2 locations, Central and South America as well as Southeast Asia. Several new locations entered the FAO delivery location map including South Africa and Morocco.
• In 2010, technology augmentation emerged as the new “normal” – nearly 50 percent of the new contracts included add-on tools such as workflows, interfaces, document management, business process management, business intelligence and user portals/dashboards.

In Everest Group’s Performance/Experience/Ability/Knowledge (PEAK) matrix, leading service providers were Accenture, IBM, Genpact, Capgemini, Infosys BPO and HP. Other service providers in the analysis include TCS, Wipro, WNS, ACS-Xerox, Steria, Vengroff Williams & Associates (VWA), Outsource Partners International, Cognizant, EXL Services and Intelenet. Also included in the report are emerging providers: iGate-Patni, Minacs, HCL and KPIT Cummins Infosystems.

Everest Group also highlighted five service providers as 2010 FAO Market Star Performers: Accenture, Genpact, IBM, TCS and WNS. Last year, these service providers demonstrated the strongest movement forward across the following two dimensions:

• Market success in 2010 based on ACV growth, number of contract signings and value of contract signings last year
• Capability advancements in 2010 based on expansion of scale, scope, delivery footprint and technology investments

The Star Performers designation relates to year-on-year performance for a given service provider and does not reflect on overall market leadership positions. Those identified as the 2010 Star Performers include both leading service providers and major contenders.

“Increasing competitive intensity among service providers is driving innovation,” said Gupta. “Beyond cost arbitrage, the FAO value proposition will expand this year to include best-in-class process optimization and, as contracts mature, we’ll see more demand for business and strategic impact. This also will be a testing year for platform and SaaS-based offerings.”

Everest Group’s analysis includes multi-process FAO contracts with a minimum of two F&A processes, over US$1 million in ACV and a minimum contract term of three years. The report includes 580 FAO contracts within this scope signed as of 2010.

To read an extract of the Finance & Accounting Outsourcing Annual Report 2011, purchase the report, or inquire about other research services, please visit research.everestgrp.com, email [email protected] or call +1-214-451-3110.

Everest Group 2010 Report: Outsourcing market grew 6 percent over 2008 | Press Release

Report projects positive growth outlook for the global sourcing market in 2011 

DALLAS, March 1, 2011 ─ The global outsourcing market continued to steadily grow in 2010 with an annualized growth rate of 6 percent compared to 2008 with the year seeing transactions reach a 36-month high in the fourth quarter, according to Everest Group, an advisory and research firm on global services. Transaction volumes in North America and Europe were higher than 2009 volumes by 20 percent and 17 percent respectively, indicating revival of activity in these geographies.

Everest Group’s Market Vista: 2010 in Review captures key developments in the outsourcing and offshoring industry in 2010. The report includes an analysis of outsourcing transaction trends, captive-related developments, market activity by locations, location risks and opportunities, key service provider developments, and implications for sourcing industry stakeholders. The report compares market activity in 2010 with preceding years to capture evolution of the outsourcing market.

In 2010, the outsourcing market saw IT Outsourcing (ITO) transaction volumes increase at an annualized rate of 5 percent from 2008 while Business Process Outsourcing (BPO) transactions increased 12 percent during the same period. The market recovery was led by traditional industry verticals, such as BFSI (banking, financial services and insurance), and buyer geographies, such as North America.

Other 2010 findings include:

• A revival in high-value deals occurred with the number of mega deals, transactions with total contract values (TCV) of US$1 billion or greater, reaching a two-year high in the fourth quarter.
• The captive model continued to grow with 132 captive set-ups and only six divestitures last year compared to 77 and 114 set-ups in 2008 and 2009, respectively.
• Although Asia continued to lead offshore activity, offshore adoption also spread to other locations. Last year saw 39 new delivery centers in India followed by 32 in Eastern Europe, 27 in Latin America, 25 in the Philippines, 16 in China and six in Africa.
• Last year, China was reclassified as a mature location by Everest Group, which was reported in the firm’s research report, What is the True Maturity of China’s Offshore Services Market?
• Political crises in Egypt and Tunisia brought concerns and new implications to the outsourcing industry as discussed in Everest Group’s report, Turmoil in Egypt and Tunisia: What’s Next for the Global Services Industry?
• Despite the economic slowdown, leading service providers in Everest Group’s Market Vista Index saw increases in revenues, operating margins and headcount.
• The service provider landscape witnessed significant M&A activity in 2010. M&A activity in the near to medium term is likely to focus on Tier-2 IT and pure-play BPO service providers.

“There is a positive growth outlook for the global sourcing market in the near term, driven by renewals and expanding scope of existing contracts, tapping into new buyers in new geographies and expanded use of global sourcing,” said Eric Simonson, managing partner of Research. “Demand from North America is likely to pick up with recovery in the overall macroeconomic environment and demand from Europe should pick up also. In the medium to long term, restructuring, integration, and redefinition of sourcing strategies by large financial services companies are likely to drive significant growth in outsourcing and offshoring.” 

Market Vista reports comprise key developments among 20 leading global service providers. Traditional service provider profiles include Accenture, ACS Xerox, Atos Origin, Capgemini, Convergys, CSC, AON Hewitt, HP Enterprise Services, IBM, Dell Services and Unisys. Offshore-centric service provider profiles include Cognizant, EXL, Genpact, HCL, Infosys, Mahindra Satyam, Tata Consultancy Services, Wipro and WNS.

Market Vista is a subscription service with four reports published per year that includes location datasets, Breaking Viewpoint briefings, Market Vista Primers and Global Locations Insights newsletter. For information about the Market Vista: 2010 in Review report or other research services, please visit research.everestgrp.com, e-mail [email protected] or call +1-214-451-3110.

Cloud Computing Expert Scott Bils Joins Everest Group | Press Release

Bils brings two decades of experience to firm’s Next Generation IT Practice

DALLAS, February 22, 2011 ─ Everest Group, an advisory firm on global services, has appointed Scott Bils as partner. Bils will play a leading role in developing the firm’s Next Generation IT practice, which will support the needs of service providers, infrastructure vendors, and enterprises as they seek to address the challenges and opportunities of innovative yet disruptive technologies including the cloud (IaaS, PaaS and SaaS), virtualization, and mobile computing.

“Bils brings Everest Group and our clients nearly two decades of accomplishment and expertise in business and product strategy, business operations, corporate and business development, mergers and acquisitions and alliances in the early stage and next generation IT markets,” said Peter Bendor-Samuel, chief executive officer, Everest Group. “The development of our Next Generation IT practice is in response to leaders in the enterprise IT ecosystem who are increasingly seeking consulting services and industry-leading insights on key strategic, operational and organizational issues in the cloud, virtualization and mobile computing arena.”

Prior to joining Everest Group, Scott was the founding CEO and senior executive at Conformity, Inc., a venture-backed provider of on-demand cloud identity and SaaS management solutions. Bils led and closed multiple seed stage and institutional funding rounds; developed partnerships with leading SaaS and cloud identity ecosystem vendors including Salesforce.com, SuccessFactors, Google, VeriSign, and Appirio; and created and launched the Enterprise SaaS Working Group, which includes CIOs, analysts, and executives from Salesforce.com, SuccessFactors, Appirio, The 451 Group, Dell Computer, and other cloud thought leaders. He was the primary author of the corporate blog, “SaaS Management: Challenges of the On-Demand World.”

Bils’ previous experience includes a senior executive role at Scalable Software, where he managed and executed the company’s acquisition of META Security Group and successfully drove the company from being a niche IT asset management vendor to a leadership position in the IT risk and compliance management market. Previously, at Troux Technologies, a leading venture-backed provider of enterprise architecture and IT governance software solutions, he expanded the company’s product portfolio and also established Troux’s global partner program, which led to development of 17 innovation, infrastructure, and industry association partnerships.

At Trilogy Software, Bils led a turnaround of the company’s legacy product lines for the enterprise hardware industry, drove new product development efforts from opportunity identification through product definition, and developed the company’s industry vision and first product line for the PC industry. As an engagement manager at McKinsey & Company, Scott provided counsel and guidance on corporate and business unit strategy and M&A issues to senior technology and telecommunications client executives. Previously, at Andersen Consulting (now Accenture), he assisted in the design, implementation, and testing of application software solutions for Fortune 500 clients.

Scott holds a MBA from the University of Chicago and earned an undergraduate degree in finance from the University of Illinois at Urbana-Champaign.

Everest Group CEO to Discuss Service Delivery Optimization | Press Release

Peter Bendor-Samuel to discuss strategic framework for sourcing portfolio optimization and service delivery effectiveness

DALLAS, February 15, 2011 ─  Many global services organizations must evolve and extract more value from their shared services and outsourced environments but are unsure how to move forward, according to Peter Bendor-Samuel of Everest Group, who will discuss service delivery optimization at two upcoming sourcing industry conferences.

Bendor-Samuel, chief executive officer of Everest Group, an advisory firm on global services, will discuss how organizations should proceed to move from efficiency to a state of effectiveness when he presents “Service Effectiveness: How Companies Can Evolve Their Service Delivery Value” at the following conferences:

• The 2011 Outsourcing World Summit, produced by the International Association of Outsourcing Professionals (IAOP), Feb. 21-23

• 15th Annual North American Shared Services & Outsourcing Week, produced by International Quality & Productivity Center (IQPC), March 1-3

“Today, most client organizations have matured in their use of global services, becoming skilled at achieving efficiency. But effectiveness remains the age-old issue,” said Bendor-Samuel.  “Further complicating the situation, effectiveness is in the eye of the beholder, which results in misalignment among stakeholders.   To move beyond efficiency, stakeholders need to examine their differences among key dimensions and then use that knowledge to unlock opportunities to achieve world-class delivery organizations that work hand-in-hand with recipient organizations to achieve effectiveness.”

For more information about IAOP’s 2011 Outsourcing World Summit, go to www.iaop.org. Visit www.sharedservicesweek.com to learn more about IQPC’s 15th Annual North American Shared Services &

Everest Group Q4 Report: Outsourcing Transactions Reach 36-month High, Mega Deals Boost Market Growth | Press Release

North American transaction volumes increased by 24 percent while ACV decreased by 10 percent over Q3.

DALLAS, February 7, 2011 ─ Building on the momentum gained in mid-2010, the global outsourcing and offshoring market continued on a growth trajectory with eight mega deals, each having a contract value over $1 billion, announced in the fourth quarter of 2010, according to Everest Group, an advisory and research firm on global services. The number of outsourcing transactions was at a 36-month high while captive activity continued to remain healthy. There was also significant offshore activity reported with buyers and service providers setting up their delivery centers in many locations. A one-hour Webinar will be held February 10, 9 a.m. CST, to present study findings and insights.

Everest Group’s Market Vista: Q4 2010, a quarterly report on global outsourcing and offshoring activity, reports global transaction volumes reached a three-year high with deals accounting for about US$4.9 billion in annual contract value (ACV). Compared to the previous quarter, the outsourcing market grew by 6 percent in terms of transactions and 44 percent by ACV. Compared to Q3 2010, the IT Outsourcing (ITO) market increased by 16 percent in terms of transaction volume, and the number of Business Processing Outsourcing (BPO) transactions slightly dipped.

Other fourth quarter 2010 findings include:

• While North America and UK continued to dominate the outsourcing market, other markets, such as Germany and India, reported growth in transaction volumes. In North America, transaction volumes increased by 24 percent while ACV decreased by 10 percent compared to the previous quarter.
• The BFSI (banking, financial services and insurance), MDR (manufacturing, distribution, retail) and healthcare verticals contributed towards almost half of the outsourcing transactions signed.
• Activity in Infrastructure Outsourcing (IO) market increased considerably compared to Q3 2010.
• In addition to the eight mega deals, six of which were ITO engagements, 69 large deals with contract values exceeding $50 million also were recorded during the quarter. 
• There were 34 new captive announcements reported and no divestitures. Although Asia gained half of the new captives, Eastern Europe and Latin America witnessed adoption with eight and four announcements, respectively.
• Offshore activity saw 46 delivery centers established in the fourth quarter, a 12-month high. In addition to Asia, significant activity was also reported from locations in Eastern Europe.
• In line with the trend seen last quarter, consolidated revenues and operating margins grew in the third quarter of 2010 versus the previous quarter (Financials lag other service provider activity by one quarter.)
• Both M&A and alliance activity for service providers fell considerably compared to the previous quarter.

“The fourth quarter capped off a year where we saw the global sourcing market gain traction in terms of transactions yet, for the most part, see lower annual contract values,” said Eric Simonson, managing partner of Research. “This trend is reflective of a steady rebounding of the recessionary economy as companies refocused on their sourcing strategies and consider ways to optimize their existing sourcing portfolios.”

Everest Group’s quarterly Market Vista reports provide data and analysis of deal trends in the outsourcing and offshoring market, captive landscape, current and emerging locations and key supplier intelligence insights. Everest Group’s industry trends research complements the Market Vista reports through quarterly updates focused on industry specific global sourcing data, developments and insights across four industries (BFSI, MDR, Healthcare and Energy and Utilities).

The Market Vista Q4 report also includes these focus sections:

• Emerging locations analysis of labor arbitrage sustainability, operating costs, operating cost inflation, arbitrage sustainability and currency trends. Cities profiled include Johannesburg, South Africa; Ho Chi Minh, Vietnam; Istanbul, Turkey; Bangkok, Thailand; Guatemala City, Guatemala; San Salvador; Kiev, Ukraine; and Port Louis, Mauritius.
• Location optimization insights include focus on financial incentives and other initiatives in South Africa; growing significance of the Philippines in non-voice BPO and IT; worsening of narco-violence in Mexico; and impact on labor arbitrage for source geographies outsourcing to Brazil and Chile, due to currency appreciation.

Quarterly Market Vista reports comprise key developments among 20 leading global service providers. Traditional service provider profiles include Accenture, ACS Xerox, Atos Origin, Capgemini, Convergys, CSC, AON Hewitt, HP Enterprise Services, IBM, Dell Services and Unisys. Offshore-centric supplier profiles include Cognizant, EXL, Genpact, HCL, Infosys, Mahindra Satyam, Tata Consultancy Services, Wipro and WNS.

The Webinar will be held February 10 at 9 a.m. CST; 3 p.m. GMT Standard Time. To register, please visit: research.everestgrp.com/Events/Webinars.

Market Vista is a subscription service with four reports published per year, now enhanced to also include location datasets, Breaking Viewpoint briefings, Market Vista Primer and Global Locations Insights newsletter. For information about the Market Vista: Q4 2010 report or other research services, please visit http://research.everestgrp.com/, e-mail [email protected] or call +1-214-451-3110.