Jimit Arora
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Jimit Arora

Jimit Arora leads the IT Services research team and assists clients on topics related to Cloud, Infrastructure, Applications and Digital services. Jimit’s responsibilities include leading Everest Group’s vertical-specific research programs focused on Banking, Financial Services & Insurance and Healthcare & Life Sciences Technology Services. To read more, please see Jimit’s bio.

Everest Group’s 3rd Annual Service Provider of the Year™ Awards: Did Your IT Services Provider Win? | Sherpas in Blue Shirts

By | Blog, Outsourcing

2017 was a seminal year for IT services. Digital adoption finally broke free from the shackles of marketing’s lip service and moved from “pilot” to “program.” The of role CIOs resurged as business stakeholders relied on them to deal with an ever-growing supply landscape and procurement conundrum to deal with new-age technology. And growth challenges appeared to have bottomed out for the two key industry verticals: BFSI (the largest) and Healthcare & Life Sciences (the fastest).

Hence, our 2018 Service Provider of the Year™ awards for IT services providers – our third edition – recognize companies that not only weathered a challenging year but reinvented themselves to chart out a new phase of growth for 2018 and beyond.

Our methodology

We select the IT Service Provider of the Year award winners based on the consolidated scores they achieve in the Star Performer, Leader, Major Contender, and Aspirant positions on our PEAK Matrix™ evaluations. In 2017, 67 service providers participated in 24 PEAK Matrix evaluations.

Awards categories

This year’s awards categories:

  • Leader boards
    • ITS Top 20: A list that recognizes the top 20 service providers
    • Top 10 Challengers: New this year, this list recognizes the top 10 service providers with annual revenue less than US$2 billion that increasingly position in the PEAK Matrix evaluation segments as challengers to the established leaders.
  • Individual awards
    • Leader of the year: Recognizes the service provider(s) with the maximum number of Leader positions
    • Star Performer of the year (overall): Recognizes service provider(s) with the maximum number of Star Performer positions.

We awarded these recognitions in the following areas:

  • Overall IT Services
  • Application Services
  • Digital Services
  • Cloud and Infrastructure Services
  • Banking, Financial Services, and Insurance
  • Healthcare and Life Sciences

Highlights of 2018 Service Provider of Year Awards

Here’s a look at the top five on the ITS Top 20 leader board:

PEAK SP of the Year

  • Accenture and TCS took the top two positions in the ITS Top 20
    • Accenture retained its top slot from 2017
    • TCS moved into second place, leapfrogging Cognizant and IBM
  • Accenture won Leader of the Year (overall)
  • TCS won Star Performer of the Year (overall)
  • And in the new Top 10 Challengers category, LTI and Virtusa snagged the top two positions.

Wondering if your IT services provider – or the firm you work for – received one of these coveted awards? See the complete list of winners.

Investments in Digital Pay Off for Retail Banks | Sherpas in Blue Shirts

By | Banking, Financial Services & Insurance, Blog

Our banking analyst team just finished its evaluation of how the leading North American retail banks are doing in their efforts to create the best digital customer experience, and we want to share some highlights from this breakthrough research. This is our third year of assessing 30 of the largest retail banks. The premise for the research is to examine the new consumption context of financial services – where customers are demanding a SUPER (Secure, Ubiquitous, Personalized, Easy, Responsive) banking experience.

Our research assessed the functionality and pervasiveness of the banks’ consumer-facing digital interaction layer to help establish correlations with superior customer experiences, stronger customer engagement, and higher overall business growth.

Based on our research, nine U.S. banks (Ally Bank, Bank of America, Capital One, Chase, Citi, PNC, SunTrust, USAA Bank, and Wells Fargo) and two Canadian banks (CIBC and RBC) have been featured as “Digital Banking Pinnacle Enterprises™.” These banks demonstrated business results that stood above the rest:

  • Better growth – 3% higher growth in deposits
  • Better efficiency – 9% lower efficiency ratio
  • Better customer experience – 20% higher mobile application ratings

We have also recognized four retail banks as “Agile Performers,” as they made the greatest improvements in 2017. These banks include Ally Bank and Bank of America, both of which launched multiple initiatives to meet millennials’ customer experience expectations, such as virtual assistants for personalized experiences and voice-command enabled banking capabilities. USAA demonstrated best-in-class adoption of digital banking channels and maintained its frontrunner position in customer-centric innovation. USAA also joined the cryptocurrency world by adding the ability to display customers’ bitcoin balances. SunTrust made considerable investments into self-service technologies across its branch network and recorded strong growth in customer engagement on social media.

retail-banking-digital-pinnacle-banks

The retail banking industry will continue to make dramatic changes in the next few years. These shifts will require banks to have increased capabilities to deliver an enhanced customer experience whose key elements include:

  • A paradigm shift from the current “product” mindset to a “customer lifestyle” mindset to combine, package, and offer products/services from banking and allied businesses
  • Open banking and partner ecosystems leveraging APIs to integrate third-party services into the bank’s digital banking platforms
  • Collapsing the siloes across the front-, mid-, and back-office to create a frictionless front-to-back experience
  • Harmonized data repositories to enable a unified view of the customer
  • A technology operating model that embraces automation, AI, blockchain, and cloud to enable the needs of the “new business”

We believe the current Digital Banking Pinnacle Enterprises have created superior customer experiences because they deliberately invested in their digital capabilities. But the bar for success is constantly moving, as the industry continues to witness rapid and significant changes. Nonetheless, our data from the last three years establishes an increasing correlation between digital functionality and business outcomes. Banks that are able to quickly adopt a human-centered design thinking approach, build usable experiences, and create a culture of obsessive customer focus will be able to better differentiated experiences, achieve growth, create shareholder value, and ensure market relevance.

To read all of our research findings, see our report: Digital Effectiveness in Retail Banking | Pinnacle Model™ Assessment 2018: Journey of North American Banks to Build SUPER Experiences

Future Proofing Your IT Services Model | Executive Point of View

By | Uncategorized

With the emergence of digitization, the Internet-of-Things, cloud, and other technology disruptors, IT’s role in and value proposition for the business units it supports have become integral to how competitiveness is established and maintained. Business that are incapable or unwilling to leverage the full power of the technology advances or resist adapting to the new business models that are being enabled, will, in relatively short order, become laggards in their industry and, in some cases, cease to remain in business.

Download this Executive Point of View

Everest Group’s New IT Service Provider of the Year Awards 2016 | Sherpas in Blue Shirts

By | Blog

Everest Group is proud to release the first edition of its annual PEAK Matrix Service Provider of the Year™ awards for IT Services 2016.

Before you turn a blind eye to another set of service provider awards in a market already flooded with matrices, quadrants, and other such convoluted shapes…these are special recognitions of a small handful of providers that are unique stand-outs.

2015 was a seminal year for our IT services PEAK Matrix™ evaluation program. Under the aegis of four key ITS practices – Banking, Financial Services & Insurance (BFSI), Healthcare & Life Sciences (HLS), Application & Digital Services (ADS), and Cloud & Infrastructure Services (CIS) – we published a whopping 26 PEAK Matrix evaluations, featuring double click views on capabilities and market success across practice sub-segments.

While we appropriately recognized performance in individual segments, what started to unravel was a picture of consistency by a few service providers that was hard for us to ignore. Hence, while there indeed are Leaders and Star Performers for each of the segments we evaluated, the composite picture clearly shows that some deliver consistent leadership and top performance across many different categories.

As today’s enterprises navigate the complex landscape of next-generation and legacy technology, a global business footprint, and a complex vendor portfolio, the PEAK Matrix Service Provider of the Year awards will help them to identify the best of the best – service providers with strong broad-based capabilities and successful service strategies that align well with the evolving enterprise IT demand.

The award categories are:

  • ITS Top 20: We arrived at this list using a consolidated score reflecting points received on individual evaluations based on tiered scores for Star Performer, Leader, Major Contender, and Aspirant positions.
  • Individual awards categories: These awards are based on the count of Leader or Star Performer positions across the category evaluated
    • Leader Of The Year
      • IT Services (Overall)
      • HLS
      • BFSI
      • ADS
      • CIS
    • Star Performer Of The Year
      • IT Services (Overall)
      • HLS
      • BFSI

Here’s a PEAK peek at the top five on the ITS Top 20 leader board.

Top_5_PM_SP_oftheyear_award_2016

 

See the complete list of winners.

Have you had experience with one or more of these providers? Our readers would love to hear your views about them!

Why Mess with a Good Thing: Recalibrating Our PEAK Matrix Assessment Methodology | Sherpas in Blue Shirts

By | Blog

We regularly make small adjustments to our PEAK Matrix™ assessment methodology – minor tweaks to fine-tune our approach to align with market evolution. This year, however, we have decided to undertake a more comprehensive modification to the assessment.

Why mess with a good thing? To make it even better and more relevant. In particular, we’re making changes to keep pace with the rapid evolution of IT and business process services, particularly as innovation, intellectual property (IP), digital, and technology-driven solutions take center stage in the delivery of these services.

While our fundamental principle of using a fact-based assessment remains core to our methodology, we are enhancing our PEAK Matrix assessment methodology in three principle areas.

  1. Maximize IP and innovation. We are recognizing the rising value of IP and innovation in global services by significantly increasing the weighting assigned to them. Of course, IP and innovation have always been a part of the PEAK Matrix Assessment, but their status will rise in the assessment, as has their significance in the global services market.
  2. Eliminate FTE count. At the same time, we are eliminating FTE count as an assessment dimension altogether. As technology increasingly fills the roles FTEs had managed in the past – at lower cost and often better outcomes – the size of a provider’s delivery talent pool has become irrelevant.
  3. Minimize scale. The provider’s overall scale – a combination of financial strength and focus on the service area being assessed – will remain as part of the assessment, but will decline in importance in the evaluation, making room for innovation to take on a larger role.

Together, we believe these changes assure that our assessment framework continues to be aligned with the emerging and future direction of the global services market.

We expect these changes to have a couple of implications for service providers. First, those providers that bring innovative programs to their clients will be recognized for their efforts – and expense. Furthermore, overall scale will have less impact on the providers’ ratings, assuming they demonstrate high levels of innovation and good business outcomes.

The recipients of these services, the enterprise buyer, will have a much clearer view of each provider’s ability to deliver innovation and outcome-oriented solutions. And they will gain insights that will help them better understand how service providers’ capabilities align with future objectives.

As the dynamic global services industry evolves, we will continue to make adjustments to our PEAK Matrix assessment methodology – some minor, some major – to ensure that it retains its universal relevance and value.

Because sometimes messing with a good thing is a good thing.

Will Cloud Kill The CIO? Survey Says No | Gaining Altitude in the Cloud

By | Gaining Altitude in the Cloud

Sometimes it’s hard to distinguish the facts from hype in enterprise cloud adoption. This is why Everest Group and Cloud Connect continue to conduct our annual joint survey to understand why and how enterprises are migrating to the cloud, and what they are migrating to the cloud. Check out my blog on InformationWeek for more findings on the Enterprise Cloud Adoption Survey. Here’s an excerpt:

If supermarket tabloids covered enterprise cloud adoption, their headlines would scream “The CIO is Dead,” “Security Concerns are Old News,” and “Cloud Makes Consumption Easy—No External Help Required.” And as we perused these headlines in the checkout line, we would wonder how much truth lay behind the hype.

To distill fact from fiction, the Everest Group launched the Enterprise Cloud Adoption Survey in 2012, in conjunction with Cloud Connect and UBM TechWeb. We have just completed the third annual survey of enterprises and vendors and will share the results in Las Vegas on Monday, March 31, at Cloud Connect Summit, co-located with Interop.

Read more on InformationWeek

You can also download the full survey summary report here.

Enterprise Cloud Adoption: 5 Hard Truths | Gaining Altitude in the Cloud

By | Gaining Altitude in the Cloud

Originally posted on InformationWeek


Last fall I had the honor of sitting on the selection committee for the inaugural ICE (Innovation in Cloud for Enterprise) Awards, sponsored by the Cloud Connect show and Everest Group. The experience taught me how large enterprises are adopting cloud computing in ways that are often compelling, sometimes surprising, and occasionally breathtaking.

The winner, Revlon, Inc., presented an impressive case for how it leverages cloud to achieve organizational transformation that boosts competitiveness and consumer wallet share.

As impressive as each individual entries was, there were five recurring themes that emerged across the enterprise cloud adoption stories we read. While certainly not scientific, they reflect what enterprises themselves report as important factors in the success of their cloud deployments.

1. Identify a compelling reason to step out of the comfort zone.
We’ve read about the importance of senior management buy-in to achieve success in cloud transformation. But what we found in the award entry submissions is that the truth is even starker: Senior management must believe that cloud adoption is critical to organizational survival.

The high-level driver might be one of the ethereal themes we read about in the tech press: Product or service differentiation, moving to market faster with new services, or getting closer to the customer through big data analysis. However, the visceral driver is always primal: We do this or we’re going to suffer at the hands of our competitors.

Read more on InformationWeek

Infosys: Not Guilty… But Not Yet Out of the Woods | Sherpas in Blue Shirts

By | Blog

On August 20, 2012, the Alabama District Court dismissed the whistleblower retaliation lawsuit initiated by Jack Palmer against Infosys. Interestingly, the judgment also ordered the plaintiff to bear the court costs, further underlining the emphatic rejection of the lawsuit. Yet in the face of this particular win for Infosys, it is important to understand the implications of the judgment for Infosys customers and investors, and for the offshore IT services industry as a whole. Should all concerned breathe a sigh of relief, leave this chapter behind, and move on to other important business? Unfortunately, no – at least not yet!

Infosys’ legal troubles are far from over. Earlier in August, Satya Dev Tripuraneni, a California-based former Infosys employee also filed a lawsuit against Infosys for whistleblower retaliation. While the judgment in the Palmer case provides encouragement to Infosys, we must take into account that the Tripuraneni lawsuit was filed in a different jurisdiction with a different judge, and has a different set of facts.

The second and more important thing to keep in mind is that the judgment in the Palmer case only exonerates Infosys from any wrong doing in response to the whistleblower’s lawsuit. It does not provide any additional clarity on the underlying issue of visa misuse by Infosys. This is currently the subject of a federal criminal investigation, and the outcome is likely to have a more direct impact on the company and the broader services market.

Unlike the whistleblower case, Infosys is on potentially weaker footing on this issue, as it admitted that the Department of Homeland Security found errors in a significant percentage of Form I-9 employer eligibility verifications with respect to employees working in the United States. An unfavorable outcome from the investigation could prove quite serious, as the consequences extend well beyond a financial fine to possibly include reputational damage, a drop in market valuation and stock price, and a shift of client work away from Infosys. The implications may also impact other Indian heritage service providers with by proxy negative reputation overhang.

The favorable resolution of the Palmer case brings much needed good news to Infosys and other India-based companies, and Infosys itself can take a deep breath and feel somewhat validated in the position it has taken to date. However, the dark clouds of the criminal investigation continue to loom ahead, and Infosys – and by extenstion the industry – is far from out of the woods.

What the Supreme Court Ruling Means for Global Sourcing in Healthcare | Sherpas in Blue Shirts

By | Blog

On June 28, 2012, the United States Supreme Court provided its much awaited ruling on the Patient Protection and Affordable Care Act. In what is considered a surprise judgment by many quarters, the Court upheld almost all provisions of the law passed in 2010.

Here is how the court ruled on the two key provisions that generated the most debate – the “individual mandate” and the challenge by the states for the expansion of Medicaid program:

  • Treating the provisions of the individual mandate as a tax versus a penalty, the Court confirmed the validity under Congress’ constitutional authority
  • Regarding the expansion of Medicaid, the court ruled that the federal government cannot place sanctions on the states’ existing Medicaid funding if the states decline to go along with the Medicaid expansion

So, what impact will the Supreme Court ruling have on the outsourcing / global sourcing activity in the healthcare vertical? Will we see a surge in demand and see activity accelerate now that the uncertainty surrounding the law is now over? Three reasons why we believe that the Supreme Court ruling does not suggest any short-term (i.e., in 2012) acceleration in outsourcing activity in the healthcare vertical:

  1. Obama versus Romney: GOP candidate Mitt Romney’s assertion – “What the court did not do on its last day in session, I will do on my first day if elected president of the United States. And that is I will act to repeal ObamaCare” – makes it clear that until the outcome of the Presidential election is known, uncertainty will continue to shroud the healthcare law
  2. Next major milestone – 2014: A number of new milestones under the law, including the establishments of health insurance exchanges and the individual mandate, do not come into effect until 2014. Healthcare companies are likely to wait until the outcome of the elections is known before making deep investments in these areas
  3. Big payers adhering – come what may: Select large payers such as UHG, Aetna, and Humana have pledged to adhere to certain provisions of the reform irrespective of the future. These payers have already implemented some of these changes (e.g., MLR mandates) and thus the technology impact of some of these changes is likely limited in the short term.

The above is not to suggest that outsourcing / technology innovation activity in the healthcare vertical has reached its peak. If President Obama wins the election, we are likely to see a surge of activity as companies prepare for the 2014 initiatives. Even a number of current bystanders will jump in the fray to ensure compliance with regulatory reform. On the other hand, a repeal could significantly alter outsourcing activity and potentially even jeopardize existing initiatives if Mitt Romney is successful!

As it pertains to uncertainty in the healthcare markets, is this the beginning of the end, or the end of the beginning? Only time, and the results of the presidential election will tell….

Which WITCH? Switches in the Indian IT Majors’ Rankings Line-up | Sherpas in Blue Shirts

By | Blog

Although five years ago it was difficult to differentiate among the WITCH (Wipro, Infosys, TCS, Cognizant, and HCL) providers, Everest Group last year identified a variety of clearly emerging and meaningful distinctions in its May 2011 examination of the top five Indian IT providers.

Our just released second annual analysis, Report Card for the Indian IT Majors: Pecking Order Analysis of the “WITCH” Group, found that the top ranked provider in each of the dimensions we evaluated – financial performance, industry vertical performance, and geographic performance – remained the same, but the rankings among the five have shifted. While the rankings are not necessarily the most effective gauge of current capability or future success, the position shifts tell important, company-specific stories.

So which of the WITCHes is where in our 2012 (April 2011 through March 2012) analysis? Let’s take a quick look.

WITCH Leaderboard FY 2012

Financial Performance

TCS retained the top spot in terms of total revenue, exceeding US$10 billion for the 12 months ending March 31, 2012. It also widened the enterprise revenue gap with #2 Infosys by ~ US$1 billion, as compared to last year (the total gap is now over US$3 billion). Cognizant’s 29% revenue growth is significantly higher than that of the other Indian IT majors, and the company, which overtook Wipro on enterprise revenue rankings last year, seems to be on track to overtake Infosys to become the second largest WITCH major. On a quarterly run rate basis, this may happen as soon as the coming quarter.

Infosys continues to be the most profitable. Note: We don’t believe that being the most profitable translates to being the most successful. Sustainable growth and success is rooted in a prudent balance of short-term profitability and longer-term investment priorities.

Industry Vertical Performance

In BFSI, TCS retained its #1 ranking with more than US$4 billion in revenues, Cognizant overtook Infosys’ #2 place at the table, and HCL is showing good momentum. But it’s also important to note here that the Indian IT majors stack up differently in the BFSI sub-verticals. For example, TCS and Cognizant are the leaders in the insurance applications outsourcing space, while Wipro marginally edged out Infosys on recent insurance industry wins, growth, client quality, and investments in domain solutions and intellectual property.

Cognizant again topped the leader board in the healthcare and life sciences space with a practice that is nearly three times the size of second-placed Wipro’s. And although Infosys’ healthcare practice is fourth in terms of revenue (US$385 million), it is also the fastest growing among the WITCH group, with 42% year on year growth. TCS’ rapid growth rate in healthcare indicates that there may be a rank change with Wipro in coming quarters.

In energy and utilities, Wipro not only retained its #1 position but also significantly increased the gap between itself and #2 Infosys, in large part due to its acquisition of SAIC’s oil and gas services business in early 2011. Interestingly, we see TCS inching closer to Infosys in this space.

Geographic Performance

While TCS won the top spot in both North America and Europe, it’s an interesting mixed bag among the other WITCH players in the two regions. Cognizant has overtaken Infosys in North America, rising to the ranks of #2, and now only lags TCS’ North American revenue by $325 million. In Europe, all providers except Cognizant achieved higher growth than in North America, with Wipro and Infosys coming in second and third, respectively.

To read a detailed analysis of the what’s and why’s of our WITCH group rankings, please download the complimentary report at: Report Card for the Indian IT Majors: Pecking Order Analysis of the “WITCH” Group.