Monthly Archives

July 2017

In First-of-its-Kind Assessment, Everest Group Identifies Leaders of Service Delivery Automation in Business Process Services | Press Release

By | Press Releases

Accenture, Cognizant, IBM and Wipro lead the industry in SDA impact, capabilities and vision. 

Several big names in the Business Process Services (BPS) market have emerged as leaders in Service Delivery Automation (SDA), according to an assessment just published by Everest Group.

Influential enterprises are disrupting the status quo by demanding from their service providers not only cost reduction but also next-generation benefits focused on business outcomes and enhanced customer experiences. For service providers looking to pivot quickly from an arbitrage-first model to digital-first one, SDA is the one of the key levers, according to new research from Everest Group.

SDA comprises a spectrum of automation solutions for delivering services, such as Robotic Desktop Automation (RDA), Robotic Process Automation (RPA), autonomics, cognitive computing (machine learning, deep learning and neuro-linguistic programming) and advanced Artificial Intelligence (AI). Collectively, SDA is one of the most potent levers that BPS service providers can deploy to help buyers move beyond labor arbitrage to attain valuable benefits.

In a first-of-its-kind report, “Business Process Services Delivery Automation (BPSDA)—Service Provider Landscape with PEAK Matrix™ Assessment 2017,” Everest Group evaluates 18 leading broad-based BPS service providers relative to their SDA market impact and overall vision and capabilities. Employing its proprietary PEAK Matrix framework, Everest Group segments the providers into three categories of performance: Leaders (top quartile), Major Contenders (second and third quartile), and Aspirants (fourth quartile):

  • Leaders: Accenture, Cognizant, IBM and Wipro
  • Major Contenders: Capgemini, Conduent, EXL, Genpact, HCL, Hexaware, Infosys, NTT DATA, Sutherland Global Services, Syntel and WNS
  • Aspirants: HGS, Intelenet Global Services and Mphasis

“Given the importance of SDA as a key value lever in the digital-first BPS world, this report provides an in-depth analysis and comparison of leading BPS providers in terms of their progress and market impact in this space,” said Rajesh Ranjan, partner at Everest Group. “Buyer experience and satisfaction was one of the important dimensions considered in this multi-dimensional assessment. Notwithstanding better performance by Leaders, there is clear opportunity for the BPS industry to improve on buyer satisfaction to realize SDA potential. This is more pronounced in the Artificial Intelligence space.”

Other key findings:

  • Accenture and Conduent have the most number of clients with BPSDA deployments by far. They are followed by Capgemini, Cognizant, Genpact, IBM and Wipro.
  • Accenture and Conduent lead in most geographies. In APAC, in addition to Accenture, Genpact has found good traction.
  • Providers’ success differs across BPS segments. Competitive intensity is high in all other high-potential areas except contact center, which is heavily dominated by Conduent.
  • Accenture and Cognizant have the most number of FTEs dedicated to BPSDA. Genpact and Cognizant have the highest share of FTEs in BPSDA product development

***A complimentary 4-page preview of the report is available for download here.*** (Registration required.)

This new report is a part of a three-part series of research findings that Everest Group plans to publish in the BPSDA space. The next report will provide an in-depth view of the state of the industry in terms of key trends, progress and future direction.

Is Mexico Losing its Luster as a Nearshore Delivery Location? | Sherpas in Blue Shirts

By | Sherpas in Blue Shirts

Over the years, Mexico has become an attractive nearshore delivery location for U.S. enterprises and service providers. But two significant potential challenges may impact its popularity.

NAFTA

To boost economic ties, Mexico, Canada, and the United States entered the North American Free Trade Agreement (NAFTA) in 1993. However, NAFTA critics argue that it has resulted in job losses and suppressed wages in the U.S., and encouraged illegal migration of workers from Mexico into the U.S. The Trump administration is considering withdrawing the U.S. from NAFTA due to ‘protectionist’ measures, i.e., those that are in the interest of U.S. domestic market.

The proposed outsourcing tax/Border Adjustment Tax (BAT)

To further promote and create jobs in the U.S., President Trump has proposed incentivizing companies to make goods domestically by adding a tax – an outsourcing, or border adjustment tax (BAT) – on companies that import goods and services from other countries. He has floated the idea of 20-30 percent BAT on imports.

While the actual impact of impending renegotiations on NAFTA and potential implementation of the BAT on Mexico as a nearshore service delivery location is yet to be seen, Everest Group conducted research to determine the likely short-term effect of these developments on the IT-BP industry in Mexico. Following are snapshot findings from our study.

everestnew1

 

Further, while there are multiple alternative locations in Latin America available to U.S. enterprises, very few offer a significantly better cost-talent proposition than Mexico. Thus, even in the likely scenario of NAFTA revocation, Mexico is not likely to lose its sheen as an attractive nearshore location for IT-BP service delivery for U.S.-based organizations.
Although there are no favorable indicators in the short-term, there have been no knee-jerk reactions from firms leveraging Mexico for service delivery. We believe the country’s medium- to long-term outlook continues to remain positive for IT-BP services delivery.

For more detailed findings, please read our report: “Mexico IT-BP Services Viewpoint.”

Michel Janssen Rejoins Everest Group as Chief Research Guru | Press Release

By | Press Releases

Strong senior leadership to guide research agenda and capabilities in an era of sourcing industry disruption

Everest Group, a consulting and research firm, today announced the return of Michel Janssen to the company. Janssen, a 20-plus-year veteran of the research and consulting industries, will assume the position of chief research guru, responsible for guiding the agenda and architecture of Everest Group’s research capabilities, a division that he co-founded in 2005 during his original tenure with the firm.

“It is a tremendous pleasure to welcome Michel back to Everest Group. Having worked closely with him during his first stint and remained friends since that time, I am very excited about adding his creativity and spark to our leadership team,” said Eric Simonson, managing partner of research. “His experience in developing and scaling research capabilities will help us accelerate our evolution across many dimensions.”

As an expert in research development, Janssen has established an unequivocal track record for developing analysis and frameworks that are compelling and highly valued by clients. His return to Everest Group reflects the firm’s commitment to the growth of its research practice and its confidence that Janssen will contribute significantly to the firm’s expansion and market-leading innovation during a period when the senior executives across industries are facing significant market disruptions that call for the innovative, best-in-class application of technology and business processes.

“With his broad and varied career in the research industry, Michel is uniquely positioned to offer profound fact-based insights to enterprises and service providers alike,” said Everest Group CEO and founder Peter Bendor-Samuel. “His experience and entrepreneurial spirit will help propel Everest Group’s research practice to a new level – one that truly reflects the depth and breadth of our research capabilities, including our focus on digital transformation. We are pleased to welcome him home.”

Prior to rejoining Everest Group, Janssen spent a successful decade serving as chief research officer at Market Track, where he more than tripled the practice’s revenues during his 3 1/2 years there, and at The Hackett Group, where his contributions to innovating the research methodology and enhancing the market relevance of research services helped the company expand its practice by more than 15 percent annually. Earlier in his career, Janssen held analyst positions with Gartner and service leadership roles at EDS. He is widely quoted in news media as a subject matter expert on applying business insights and is a prolific contributor of thought leadership to conferences.

In addition to Janssen, Alan Wolfe, who brings 30 years of sales and sales management experience with leading research and consulting firms, joined Everest Group in the role of senior vice president of sales in May 2017. A dynamic and versatile sales leader, Wolfe helps generate revenue and income growth by building and nurturing outstanding sales teams. Prior to joining Everest Group, Wolfe held leading roles in several professional services organizations, including The Hackett Group, Gartner and Deloitte Consulting.

Should Your Global Service Delivery Locations Portfolio Include Western Europe? | Sherpas in Blue Shirts

By | Sherpas in Blue Shirts

As enterprises move from an arbitrage-first to a digital-first model to gain business value beyond cost savings, and to lessen the impact of potential immigration-related issues, service delivery from locations that were traditionally considered “onshore” is gaining prominence.

Western Europe* is one region that has gained significant importance as a global/regional delivery geography over the last several years. Indeed, Everest Group’s research on the growth of back- and middle-office services delivery demonstrates a compellingly strong value proposition across all the countries in the region.

 

service delivery

* The Western European region is defined as Austria, Belgium, Denmark, France, Finland, Germany, Greece, Italy, Ireland, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and United Kingdom.

Yet, due to multiple misconceptions about the region, some readers may need to be convinced of its viability as a digital-first delivery location. Thus, here are some fallacy-busting facts from our recently-released report, “Emergence of Western Europe for Centralized Global Service Delivery to Europe”:

  • Myth 1: Western Europe is predominantly a source geography, not a delivery geography
  • Reality 1: Global in-house Center (GIC) setup activity has seen significant growth, with double the number of new setups in 2014-2016 compared to 2011-2013

service delivery

  • Myth 2: Western European cities cannot offer more than 10-20 percent savings
  • Reality 2: Contrary to popular belief, selected locations in Western Europe can offer cost savings up to 30-50 percent over tier-1 locations (e.g., London, Frankfurt, and Paris)
    • Barcelona, Belfast, and Lisbon offer the highest cost savings due to lower salaries and infrastructure costs

 

  • Myth 3: Western Europe is primarily leveraged by Western Europe-based enterprises for service delivery
  • Reality 3: In 2016, U.S-based enterprises established the largest percentage of new GICs in the region

 

service delivery

 

  • Myth 4: The value proposition offered by Western European locations is limited to support of European languages
  • Reality 4: Western Europe’s value proposition extends far beyond language to the availability of skilled talent, stable business/operating environment, cultural affinity, high maturity for certain niche services, and delivery of skill-intensive work. Multiple locations in Western Europe are particularly well suited for complex digital services (e.g., analytics, blockchain, and mobile development.)

Clearly, there are many reasons why Western European cities are playing a strong role in the delivery portfolio of a growing number of organizations that have highly advanced locations strategies.

Of course, there are multiple factors that could potentially alter the landscape of delivery from Western Europe. Issues global services leaders need to carefully consider include Brexit, adoption of digital technologies (e.g., social, mobile, analytics, and cloud), and likely changes driven by the General Data Protection Regulation (GDPR) and the European Central Bank (ECB.)

For a more detailed analysis of the value proposition of Western European cities, and relative comparisons of leading locations, please see our recent report, “Emergence of Western Europe for Centralized Global Service Delivery to Europe.”

The Key To Achieving Breakthrough Performance | Sherpas in Blue Shirts

By | Sherpas in Blue Shirts

If your company only wants to achieve an incremental outcome from your change initiative, it is fine to maintain your current business model. However, achieving breakthrough performance requires a fundamental change in the company’s business model. That kind of change is difficult. But given the enormous benefits that are available for companies in customer interactions, customer experience and cost to serve, I believe companies that want to compete and succeed in 2017 and beyond need to tackle a business model change.

By “breakthrough performance,” I mean transformation with an outcome that significantly shifts the company’s revenue and margin profiles and enables a substantive shift in the value proposition the company delivered to its customers. The opportunity for breakthrough performance is very high. But a lot of studies reveal a high degree of failure in these efforts.

 

Read more here

Preparing for End of Term: Key Considerations for Today’s Dynamic Environment | Virtual Roundtable

By | Webinars

Thursday, July 27, 2017 | 11:00 a.m. – 12:30 a.m. ET

Preparing an end-of-term strategy involves critical analysis around renew versus recompete versus re-sourcing. Current Market dynamics, including the rotation to digital and geopolitical unrest, are significantly impacting the market, making contracting even more complicated.

To help sourcing and procurement executives nearing end of term on major outsourced contracts, this session will provide an update on current market trends and practices, followed by a group discussion among participants on how they are approaching their sourcing strategies and negotiations, including key considerations and best practices, among other topics.
Who Should Attend
Global services sourcing and procurement executives in enterprises nearing end of term in their key outsourced contracts.

What You Will Learn
This session will help participants develop an understanding of the key considerations, best practices, and next-generation digital levers to manage end-of-term planning and execution.

Request to attend

Cognizant share surges on buy back | In the News

By | In The News

Cognizant’s share price has been surging in recent months, leading to a widening in the difference between its market capitalization and those of its peers Infosys and Wipro.

The company now has a $6 billion lead over Infosys in market capitalisation. Infosys had caught up with Cognizant and overtaken it in 2016, but it has not lost significant ground. Infosys’ share price has fallen in the past one year.

“My belief is that Cognizant is benefiting from the promise it has made to Elliot Management that it will raise margins and return cash to shareholders. The market may not have fully baked in that to do this Cognizant must reduce its sales expense and that this will slow down its growth,” said Peter Bendor-Samuel, CEO of Everest Group.

Read more in The Times of India

Infosys’ head of $500 million innovation fund Yusuf Bashir resigns | In the News

By | In The News

In another huge setback to Infosys CEO Vishal Sikka’s strategy to strengthen the company’s new digital and innovation capabilities, Yusuf Bashir, MD of the $500-million Infosys Innovation Fund, has resigned.

The MIT-alumnus had worked closely with Sikka at SAP as VP of new products before joining Infosys in March 2015.

Together with another former SAP executive, Ritika Suri, Bashir was to help Infosys take a leap into the new digital world that has become important to global clients. Bashir, based in Palo Alto, had the mandate to identify and invest in early-stage companies doing cutting-edge work in areas including AI, machine learning, big data, cloud and analytics.
Peter Bendor-Samuel, CEO of Everest Group, feels Bashir was caught between Sikka’s stated intent to use acquisitions to drive the digital transformation of Infosys and the board which micromanaged and second guessed decisions. He was not nearly as comfortable with an aggressive acquisition strategy. “This was compounded by the decision to return cash to shareholders and focus on keeping margins high,” he said.