Category: Press Releases

Global Sourcing Takes a Hit from COVID-19 as GBS Activity Decreases 48% in Q2 — Everest Group | Press Release

Service providers see declining revenues and margins; cybersecurity, desktop and mobility services gain traction as enterprises adapt to work-from-home

Q2 results are in, and Everest Group reports the Global Sourcing industry is suffering from the negative business impacts of the COVID-19 pandemic. Two trends illustrate this: First, the worldwide setup of Global Business Services (GBS) centers, also known as Global In-house Centers (GICs), fell sharply (more than 48%) as offshore/nearshore activity dropped 46% and onshore setups dropped 52% for the quarter. Second, although overall outsourcing activity ticked upward slightly (2%) for the quarter based on the number of deals signed, service providers reported a decline in both revenues and operating margins.

In offshore and nearshore locations, GBS market activity declined from 44 in Q1 to 24 new setups in Q2. In onshore locations, GBS market activity decreased from 33 new setups in Q1 to 16 in Q1 2020. New center setup activity in India reached an all-time low, after seeing only 8 new setups in Q2 as compared to 16 in the previous quarter.

Based on financial reports from Q1 2020, the consolidated revenue and operating margin of service providers witnessed a decline, -1.5% and -21% respectively, in comparison to the previous quarter.

“The global services industry is certainly feeling the pain of the economic downturn caused by COVID-19,” said H. Karthik, partner at Everest Group. “Enterprises and service providers functioning in sectors such as travel and hospitality, aviation, retail, automotive and manufacturing sectors have been hit the hardest in this quarter due to extremely low demand and supply constraints. Further, delays in new project renewals and cancellations of ongoing outsourcing projects have been witnessed in a number of cases. This has been followed by cost optimization measures that included layoffs for several enterprises and service providers.

“However, governments across the world have announced stimulus packages and relief measures,” continued Karthik “The G20, for instance pledged to infuse over US$5 trillion to support economies and protect workers and businesses. This infusion of support provides hope for recovery, and we continue to expect that significant containment in the spread of the virus will lead to further recovery of sourcing activity as lockdowns and travel restrictions can be eased.”

These global sourcing trends are detailed in Everest Group’s recently released Market Vista™: Q3 2020 report. The report shines a spotlight on transaction trends and outsourcing deals, GBS-related developments, offshoring dynamics, location risks and opportunities and key service provider developments.

***WEBINAR, Thursday, September 10***
Everest Group is hosting a complimentary 60-minute webinar, “Impact of COVID-19 Beyond WFH: The Future of Delivery and Locations Strategies.” Everest Group experts will provide a fact-based view of the already-visible effects of the pandemic and discuss the implications of these developments on future delivery and locations strategies, including key changes to delivery portfolios, trends in onshoring versus offshoring, locations portfolio consolidation versus diversification, rise in large scale hubs versus small scale centers, and adoption of a remote or work-from-home delivery model.

The live webinar will be held on Thursday, September 10, at 9 am CDT. Register here.

Highlights of the Market Vista Q3 Report:

  • Demand for desktop services is continuously gaining traction as firms across the globe adapt to a work-from-home model. There was also a surge in demand for mobility services as enterprises are leveraging on-demand applications to increase their online presence amid the COVID-19 pandemic.
  • As the world faces increased risk of cyberattacks due to a shift in the working pattern, service providers are gearing up their investments in the cybersecurity space, yielding an increase in the number of cybersecurity-focused acquisitions, deals and new products.
  • The Technology & Communications vertical recorded the maximum increase in the number of transactions, owing to an increase in deals across the telecom industry. The government vertical, buoyed by deals in North America, also saw an increase in deals. The Banking, Financial Services & Insurance sector as well as the manufacturing, retail and healthcare sectors saw declines.
  • The share of digital-focused new centers saw a sharp increase in offshore locations and remained stable at onshore locations in Q2 as compared with Q1 2020. The Advanced Automation segment (which includes artificial intelligence, machine learning and other cognitive technologies) continued to lead across both regions. Activity was largely driven by India and China in offshore/nearshore locations and by the United States in the onshore region.

***Download a complimentary 8-page abstract of the report***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

75% of Enterprises Bracing for Widening IT & Analytics Talent Shortage, Despite Recession | Press Release

Everest Group unveils enterprise battle strategy for winning the war for talent

An IT talent shortage already beleaguers 69% of enterprises, and the COVID-19 pandemic and global recession will exacerbate the problem. According to Everest Group, 75% of enterprises believe there will be a talent shortage for key roles in IT, analytics and special skills areas post-COVID-19 and that the current recession will not create a surplus of technology talent. In fact, 67% of enterprises think new skills gaps will emerge as a result of the structural changes in business occurring in response to the pandemic.

A recent Everest Group survey revealed that 86% of enterprises consider talent shortage to be a key barrier to achieving their desired outcomes, citing:

  • An acute shortage of qualified applicants with requisite skills
  • A lack of technical skills in the existing workforce, especially given the pace of technology change
  • Poor project readiness (for example, proficiency levels and industry contexts)
  • High attrition, particularly in niche skills areas such as artificial intelligence and data analytics.

In its recently published report, “Winning the War for Talent: An Enterprise Guide to Building a Sustainable Workforce Strategy,” Everest Group proposes how enterprises can future-proof their workforce strategy to ensure that their current workforce development efforts will bridge future gaps in IT talent availability. Featured components of the report are Everest Group’s proprietary Talent Performance Framework and a detailed skills taxonomy, compiled by tracking industry demand for 1,150+ hard skills across the IT services stack. The report also sheds light on the COVID-19 pandemic’s impact on enterprise talent models and workforce strategy.

“Because of COVID-19, enterprises are being forced to shift to work-from-home models, accommodate a more distributed workforce, and be more flexible and empathetic to sustain workforce productivity,” said Ronak Doshi, vice president at Everest Group. “We believe this new approach to workforce management—which has been borne out of necessity—will remain with us post-pandemic as an integral part of our new normal. As the war for talent becomes more intense, enterprises need to evolve their people practices; make demand management a science; embrace technology to attract, train and nurture talent; and broaden both their recruiting pools and their partnerships to ensure talent readiness.”

***Download a complimentary abstract of the report.***

Selected Highlights

  • Although a mismatch between education curriculum and industry needs is a strong contributing factor to the talent gap, enterprises themselves also shoulder some of the blame. The talent management strategies of most enterprises have not witnessed a significant shift despite the changing needs of the workforce. Enterprises also contribute to the mismatch between business objectives and current workforce skills by failing to focus on competency mapping, workforce planning, skill gap assessment and needs of the future workforce.
  • The shift in working models is presenting a new set of opportunities and challenges, such as remote working, digitally augmented delivery and flexible staffing.
  • New working models will see the emergence of roles across functions to ensure business continuity and healthy employee morale. New roles may include connectivity detectives to ensure optimal performance of the network, distributed agile team coaches to train agile teams and ensure Day Zero productivity, fatigue managers to carry out mental health assessments, and work-from-home administrators to ensure work continuity.
  • To meet talent needs in the future, organizations will need a sustainable talent strategy that includes building a skills taxonomy aligned to business imperatives, establishing well-researched demand-supply forecasts and plans, and carefully reconsidering sourcing models and location portfolios to build a next-generation skills pipeline.

***Read about the full scope and content of the report here.***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

 

Intelligent Automation in Business Processes (IABP) Market Grew 65% Pre-COVID-19, Remains One of the Most Potent Levers for Digital Transformation—Everest Group | Press Release

Accenture, Tata Consultancy Services and Wipro command nearly 40% of the global IABP market by deployments.

One of the most potent levers enabling digital transformation today is Intelligent Automation in Business Processes (IABP), which encompasses solutions that use a combination of Robotic Process Automation (RPA), Artificial Intelligence (AI), and advanced analytics to improve business processes. According to Everest Group, the IABP market, which grew 65% in 2019, will endure muted growth in 2020 due to COVID-19 but experience a strong resurgence when global economies emerge out of the pandemic crisis.

“While the current COVID-19 crisis has certainly tempered on-ground business activity and consequently IABP deals, the period after recovery is likely to witness accelerated demand,” said Anil Vijayan, vice president at Everest Group. “Clearly, enterprises who were further ahead in their digital journeys are doing considerably better than their peers in weathering the pandemic. This realization is likely to lead to a frenetic pace of transformation and consequently IABP activity post-COVID-19.”

IABP growth is driven primarily by a desire to reduce costs. Other key drivers include improving operational efficiency and accuracy, governance and compliance. Increasingly, IABP is also being used to enhance customer experience by enabling shorter response time for handling requests, round-the-clock availability, and reduced need to manually bridge gaps in technology (for instance, through repeated data entry). When done well and even at a small scale, IABP can also lead to top-line growth through the ability to serve new groups of customers and through enabling the building of new products.

In its recently published report, “Intelligent Automation Business Processes (IABP) – State of the Market Report 2020,” Everest Group analyzes the dynamics of the IABP space and examines 24 providers, consulting firms and specialist system integrators who comprise the IABP supplier ecosystem. On Everest Group’s PEAK Matrix®, IABP solution providers Accenture, Capgemini, Cognizant, IBM, TCS and Wipro are identified as Leaders, based on their ability to deliver solutions and their impact in the market.

***Download a complimentary abstract of the report.***

Market Highlights

  • There is tremendous potential for IABP, given the penetration as well as the scale of deployment of IABP is relatively low today. Barely a fifth of IABP deployments have an AI component; the majority are RPA-only deployments. However, scaling up adoption is still a key challenge.
  • Intelligent automation adoption is highest among large enterprises as they have more avenues to deploy these solutions and gain efficiency and cost benefits. They are also more willing to spend on intelligent automation as compared with small and mid-sized enterprises.
  • Adoption of IABP is the highest in North America, followed by Continental Europe, the UK and Asia Pacific.
  • Finance and accounting (F&A), procurement, and contact center emerged as the leading areas for IABP application, followed by healthcare, banking and insurance business process services segments.
  • Industry-specific use cases, especially in regulated industries such as Banking, Financial Services and Insurance (BFSI) and healthcare, see the highest IABP adoption, followed closely by F&A.

Everest Group predicts that, while there will be secular uptick in IABP adoption, BFSI, healthcare and pharma industries will drive a big chunk of growth in the IABP market, due to increased pressure in these industries to meet high levels of accuracy, speed and regulatory compliance, thus rendering IABP an attractive solution.

***Read about the full scope and content of the report here***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

Everest Group Projects -6% Growth, Loss of Up to Nearly $50B in Potential Revenue for Global IT Infrastructure Services in 2020 Due to COVID-19 | Press Release

New report describes how pandemic has reshaped enterprise IT priorities, offers strategies for combatting crisis and emerging stronger than before

Everest Group now predicts the 2020 growth rate of IT infrastructure services market will be as low as -4% to -6%, which represents lost revenues ranging from US$33 billion to nearly $50 billion. In the pre-COVID-19 world, the IT infrastructure services market was slated to grow at a modest rate of 2-3%; however, the pandemic has led to uncertainties across the globe. Recovery of the market will depend on the COVID-19 recovery curve across different countries, which remains uncertain.

The severe demand slump being experienced in the IT services industry is reflective of the strains the COVID-19 pandemic has placed upon enterprises, including:

  • Demand reduction
  • Supply chain disruption
  • Business and service continuity challenges
  • Cybersecurity risks

Going forward, organizations that can rapidly prioritize or quickly re-energize their infrastructure transformation efforts stand the best chance of surviving the crisis and emerging stronger than before. Everest Group urges enterprises to identify relevant infrastructure transformation opportunities across workplace, cloud, network and security.

“A well-planned transformation will not only rescue enterprises in the short-term, but also revitalize them for future growth,” said Ashwin Venkatesan, vice president at Everest Group. “While infrastructure will play a key role in rescuing enterprises from this crisis, they will have to take a holistic view and focus on evolving the services delivery model, seek efficiency and optimization measures, push toward modernization and digitalization, pivot to new business models, and invest in talent of the future.

“As we emerge from this pandemic, we will enter a world of the ‘next normal’ rather than ‘return to the normal,’” continued Venkatesan. “We believe that COVID-19 will act as an inflection point, giving way to structural changes in the global services industry such as ushering in new models of delivery, enabling enterprises to pivot to ‘newer’ business models, and increasing the appetite for modernization and digital transformation.”

Everest Group provides an in-depth analysis of these new, COVID-19 inspired enterprise priorities in its recently published State of the Market Report on cloud and infrastructure services, “Combatting COVID-19 Through Infrastructure-led Transformation.” The report also provides an analysis of the IT services market; IS buyer adoption trends across geographies, industry verticals and revenue sizes; and key trends shaping the cloud and IS market. In addition, the report offers Everest Group’s outlook for the market for 2020-2021.

***Download a complimentary abstract of the report.***

IT Infrastructure Services Market Highlights

  • The United States takes the lion’s share (90%) of the deal volume emanating from North America. The United Kingdom dominates the European deals landscape with typically 30-35% of the volume, followed by Germany at 10-15%. Australia and New Zealand captured 30-35% of the deals in the Asia Pacific region.
  • Banking, Financial Services and Insurance continues to be the early adopter of technology innovation, but this market segment has witnessed growth in recent times primarily due to regulatory pressures.
  • COVID-19 has accelerated the modernization journey of enterprises to cloud.
  • Work from home has become the next normal and will be an integral part of the workplace of the future.
  • Networks are finally getting due recognition, and software-defined networking is driving growth.

***Read about the full scope and content of the report here***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

IAOP Announces Everest Group as Its Research Partner to Serve Sourcing Professionals | Press Release

IAOP’s sourcing practitioners, providers, and advisors to benefit from Everest Group’s key research, including the 2021 Key Issues in Global Sourcing study.

Everest Group—a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing—today announced it has been named a research partner to IAOP, an international professional association that brings together business services providers, advisors and customers in a collaborative effort to improve business service models and outcomes.

Everest Group helps its clients solve their toughest sourcing and digital transformation challenges. The firm offers a unique depth of sourcing knowledge and decades of insight gleaned from working alongside leading organizations tackling challenging transformation agendas.

For well over a decade, IAOP has been the association that sourcing professionals count on to keep them informed, educated, and, above all, connected to the resources and people they need to succeed.

In partnership, Everest Group and IAOP will collaborate on key research, including the 2021 Key Issues in Global Sourcing study. In addition, Everest Group will offer IAOP members key insights and offerings at special pricing.

Michel Janssen, chief research officer at Everest Group, will serve on the IAOP Strategic Advisory Board. He and other Everest Group experts will regularly contribute to IAOP conferences, webinars and podcasts, sharing insights to help executives tackle outsourcing challenges and make data-informed decisions for the future.

“Everest Group is honored to partner with IAOP, an organization that is committed to provide the resources, tools and networking opportunities that its members need to succeed,” said Michel Janssen, chief research officer at Everest Group. “We are excited to be part of IAOP’s effort by providing the research-informed insights to help the industry continue to evolve and rapidly respond to today’s ever changing normal – whether that be Work From Home issues, digital transformation, changing sourcing portfolios, or evolving talent profiles.”

“We are thrilled to announce Everest Group as our new Research Partner,” said Debi Hamill, CEO of IAOP. “Our collaboration will offer IAOP members unprecedented, research-informed insights into the market and the most pressing issues keeping them up at night. Empowering our members to not only prepare for the future but also make smarter decisions along the way is key. We look forward to leveraging each of our unique capabilities to do just that.”

About IAOP
IAOP is the global association that brings together customers, providers, and advisors in a collaborative, knowledge-based environment that promotes professional and organizational development, recognition, certification, and excellence to improve business service models and outcomes. IAOP connects you and your organization to our growing global community and to the resources you need be successful. For more information, visit IAOP.org.

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

Process Mining Market More Than Doubles in Revenue and Client Base in 2019—Everest Group | Press Release

Process mining—which is the technique of using software to discover and map business processes in order to optimize and automate them—is an emerging market for service providers, growing at around 140-160% from 2018 to 2019 to reach US$230-US$250 million, according to Everest Group. The process mining vendor market witnessed a doubling in the client base from 2018-2019, indicating increasing adoption among enterprises.

Process mining blends the power of data-based analysis techniques, such as data mining and machine learning, to help organizations discover the as-is process along with its variants and identify opportunities for optimization and automation. Process mining technology can be categorized as follows:

  • Classic process mining technology leverages specialized algorithms to examine and analyze process-related information captured in event logs generated by enterprise systems such as ERP, CRM, and SCM to discover processes and generate process maps.
  • Desktop Process Mining (DPM) refers to the ability to capture user’s keyboard, mouse and potentially other system-level activities performed simultaneously on various desktops to virtually reconstruct the processes and generate process maps.

Process mining can play a key role in the success of an organization’s process optimization and digital transformation journey. However, the associated technologies are not only relatively new to many potential buyers but also rapidly evolving in terms of product features, deployment options, training and support, partner ecosystem, and commercial models.

Currently over 85% of the revenue generated in the process mining market comes from software licenses, with most vendors offering cloud-based access. Continental Europe holds the lion’s share of the market (50%) while North America accounted for the highest growth rate in revenues in 2019 (nearly 200%). Manufacturing; banking, financial services, and insurance (BFSI); and the telecom industries are among the leading adopters of process mining solutions.

Everest Group expects adoption of process mining to maintain high-growth momentum driven by the need to accelerate automation initiatives and as more enterprises become aware of the benefits of the technology, which include identifying process optimization and automation opportunities, improving process governance and compliance, and enhanced employee experience through better resource allocation.

These findings are discussed in more detail in Everest Group’s recently published report “Process Mining State of the Market Report 2020.” The report includes a detailed view of the current state of the market and analyzes it across various dimensions, including market size and adoption trends, buyer satisfaction, product capabilities and trends, solution characteristics, vendor landscape, challenges to process mining adoption, and the outlook for 2020-21.

“The process mining market has seen exponential growth over the last few years and is expected to continue the momentum in the future,” said Amardeep Modi, practice director of Everest Group. “The COVID-19 crisis is likely to temper the growth of the process mining market in the short term, especially in the manufacturing industry, but the market is expected to pick up toward the end of 2020 as the demand for automation and process optimization begins to surge.”


Overview of the Process Mining Vendor Landscape

  • Celonis, Software AG, and Minit are the top vendors in terms of process mining license revenue. ABBYY Timeline (formerly TimelinePI) has experienced the highest year-over-year growth in revenue.
  • Celonis dominates the process mining software market, accounting for over 60% market share, and has the largest client base spread across small, mid-size and large enterprise segments.
  • The process mining market has expanded beyond Europe and North America to emerging geographies such as Asia Pacific (APAC) and Latin America (LATAM). Localized vendors in these regions, such as Puzzle Data (APAC) and Everflow (LATAM), have started competing with the relatively more established process mining vendors.

***Download a complimentary abstract of the report***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

Both Capital Markets IT Spend and Outsourcing Will Fall in Wake of COVID-19—Everest Group | Press Release

New report from Everest Group examines how IT investment priorities in Capital Markets industry will vary by line of business and health of organization post-pandemic.


The capital markets industry will be under stress in 2020 as the ongoing COVID-19 global health crisis adds cost and profitability pressures. Growing regulatory requirements and changing customer demand themes will lead to a further decline. As a result, Everest Group predicts that the spend on IT services in the capital markets industry will decline 2.1% in 2020, with outsourcing spend seeing a dip of -3.7% as firms reallocate resources and cost transformation initiatives are prioritized.

Learning from and looking beyond the pandemic, capital market firms are focusing IT spend on resiliency of systems, revitalizing core to drive growth, and undertaking cost control measures. Specific IT spend priorities vary by line of business. Three examples follow:

  1. Asset management firms are investing in cloud and platforms to keep overall expenses down and make up for lower fees.
  • Vanguard, for example, migrated monolithic applications away from managed data centers to Amazon Web Services. The firm has been able to reduce the cost of compute by at least 30% and also reduce time to market by building and deploying software faster.
  • Fidelity leveraged a cloud foundry platform-as-a-Service to further develop its agile software delivery strategy. Fidelity teams used automated Continuous Integration/Continuous Deployment (CI/CD) pipelines extensively and were able to reduce the time to market for several new low-commission products designed for the mass affluent customer segment.
  • Madison Investment Advisors chose a Charles River enterprise platform to replace multiple, disparate systems running across the business. The platform enables Madison to have integrated data, analytics and benchmarks across global equities, mutual funds, options and fixed income, with comprehensive compliance monitoring across the entire investment process.
  1. Wealth management firms are investing in new channels to adapt to increasing regulations, shrinking margins and an evolving investor demographic. As aging investors are being replaced by Millennials and Gen Zs, asset and wealth managers are adapting to new-age investors who generally prefer using hybrid advisory services, value socially responsible investing, expect fee transparency and demand personalized experiences. In response, asset and wealth management firms are establishing new technology priorities, such as:
  • Using machine learning, artificial intelligence and analytics for better assessment of portfolios
  • Accelerating the use of digital channels and robo-advisors
  • Adopting agile development models to be more responsive to customer needs
  • Managing compliance and security considerations via private cloud
  • Using virtual tools for customer interaction management
  • Using Distributed Ledger Technology to improve efficiency and transparency
  1. Pension funds have high exposure to market volatility and are currently experiencing a rise in withdrawal requests from pension holders to withstand the economic shock of the pandemic and recession. Pension funds are increasing their investments in big data and analytics for portfolio analysis, correlations, risk management and long-term cash flow projections. They are also investing in robust fraud detection mechanisms to minimize data breaches.

These findings are discussed in more detail in Everest Group’s recently published report “Capital Markets State of the Market Report 2020: Automation, Data, and Cloud Trends for Buy-side Firms.”  The report includes a detailed analysis of the buy-side firms in the capital markets industry, analyzing the forces shaping the industry’s future, especially in the light of the COVID-19 pandemic.

“As capital market firms strive to recover from the COVID-19 pandemic, we’ll see them take one of four different approaches to their IT investments, depending upon how deeply they were impacted by the crisis,” explained Ronak Doshi, vice president of Everest Group. “Those most heavily impacted by the pandemic will be forced to either modernize quickly, tapping the resources of third-party platforms and service providers, or pursue aggressive cost take out, possibly even selling off legacy platforms to vendors.

“Among those more fortunate firms that are only moderately impacted by the pandemic, we’ll see some invest in longer-term transformation, taking the time to go for best-of-breed or custom solutions. Those firms with the healthiest balance sheets will pursue aggressive growth strategies, correspondingly focusing their IT spend on customer experience, the agility to rapidly launch new products, and scaling operations in the face of mergers and acquisitions.”

*** Download a complimentary report abstract ***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

Everest Group Reports Demand for IVA Technology Grew 42% in 2019, Projects 70% Growth Through 2022 After Momentary Dip Due to COVID-19 Pandemic | Press Release

IVA market growth will accelerate post-pandemic as enterprises strive to overcome recession with focus on automation, customer experience

The global Intelligent Virtual Agent (IVA) market stood at US$300 million-US$350 million in 2019, exhibiting about 42% growth year on year, according to Everest Group. The firm projects a dip in demand in 2020 due to the COVID-19 pandemic but expects the IVA market to post strong growth going forward, achieving as much as a 70% compound annual growth rate (CAGR) through 2022. In fact, Everest Group has boosted this estimate by 13-22%, anticipating that enterprises will place greater emphasis on cost reduction and improving business continuity in the post-pandemic period.

IVA solutions are a key enabler of automation in the front office, currently being used primarily for customer support as well as IT and help desk functions due to their large volumes of repetitive queries. These functions account for more than 80% of the IVA market today. Banking, insurance, and telecom industries account for the highest adoption of IVA and continue to exhibit impressive growth, particularly given the maturity of contact centers within these industries.

Increasing sophistication and collaboration with complimentary artificial intelligence (AI) based technologies are driving IVA popularity in the market. Enterprises across industries and geographies are leveraging or plan to leverage IVA solutions for different use cases to reduce human involvement and improve customer experience (CX).

“IVA is still in the realm of early adoption today, but that is rapidly changing as enterprises realize what a tremendous opportunity they have to leverage this technology,” said Anil Vijayan, vice president of Everest Group. “IVA technology is continuously advancing and growing in sophistication well beyond rule-based chatbots. Today we see a higher level of maturity in intelligent IVA applications, which are being used for a variety of use cases including payment services account resolutions and employee onboarding, for instance. We’re also beginning to see IVA playing a key role in conversational AI ecosystems, where a collaborative set of tools—including IVA, AI, robotic process automation, learning and listening engines, analytics and more—is used to seamlessly integrate front and back office systems. Here, IVA supports more advanced use cases such as cross-selling and upselling, customer retention, and making personalized recommendations. We expect this evolution to continue, leading to reliable and delightful customer experiences while reducing human effort through automation.”

These findings are discussed in more detail in Everest Group’s recently published report “Conversing with AI – Intelligent Virtual Agents (IVA) State of the Market Report 2020.”  The report includes a detailed analysis of the IVA market, including a market overview and adoption trends, solution characteristics, vendor landscape, barriers to IVA adoption and best practices, and the outlook for 2020-2021.

Evolution of the IVA Market

  • The IVA market is witnessing a significant shift from rule-based solutions to AI-driven IVA solutions, propelled or aided by the following:
    • Increase in consumer demand for self-service
    • Integration of IVA solutions with critical enterprise back-end systems
    • Innovation of voice-based conversational capabilities
    • Shift from multi-channel to omnichannel delivery by software vendors
  • In order to meet the evolving CX needs, next-generation intelligent automation technologies are expected to witness high growth as they play a key role in transforming service delivery.
  • The conversational AI ecosystem in contact centers will enable seamless collaboration between front and back office and empower faster, more reliable, and lower cost operations.

*** Download a complimentary abstract of the report ***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

Everest Group Unveils Sixth Annual Business Process Services Top 50 | Press Release

ADP, Concentrix, Teleperformance, Accenture and Arvato/Majorel take Top 5 spots among world’s largest third-party BPS providers

Everest Group today released the sixth annual edition of “The Everest Group BPS Top 50™,” a ranking of the world’s largest third-party providers of business process services (BPS). The list was launched in 2015 as the first of its kind for the global industry, which is valued at more than US$200 billion. The ranking is based on 2019 revenues and year-on-year growth.

Topping the 2020 list of BPS providers are these 10 leaders:

  1. ADP
  2. Concentrix
  3. Teleperformance
  4. Accenture
  5. Arvato/Majorel
  6. Paychex
  7. Conduent
  8. Genpact
  9. Xerox
  10. Alight Solutions

***Download a complimentary copy of the 2020 Everest Group BPS Top 50 list and analysis***

Everest Group estimates there are more than 250 service providers with more than US$50 million in revenues offering BPS around the globe. What started as a cost optimization concept focusing on “non-core” and “back-office” business processes today permeates the entire business process value chain, addressing a wide variety of business objectives.

North America-head quartered service providers continue to dominate The Everest Group BPS Top 50, with a 58% share; Europe and Asia Pacific regions followed, with 24% and 18% shares respectively. Providers in the United Kingdom made up 4% of the market.

Top 3 North American Providers:

  • ADP
  • Conduent
  • Paychex

Top 3 European providers:

  • Accenture
  • Teleperformance
  • Webhelp Group

Top 3 APAC Providers:

  • TCS
  • Wipro
  • Transcosmos

“In this year’s listing, we see two interesting trends,” said Rajesh Ranjan, partner at Everest Group. First, the divide between risers and decliners continues to widen, increasing to 35% this year. This was 23% in 2017. Secondly, we saw an uptick in the volatility in the rankings. 54% of the listed providers’ ranks changed by five or more positions in 2019, compared to 32% in 2018.”

Other highlights:

  • The Top 5 leaders in terms of revenue were ADP, Accenture, Teleperformance, Concentrix and Conduent.
  • The Top 5 fastest growing companies year-on-year were Concentrix, Willis Towers Watson, Infosys, Telus International and Teleperformance.
  • Top risers (companies whose position in the list advanced the most) include Willis Towers Watson, Infosys, CGI, TTEC and Allegis Global Solutions.

The Everest Group BPS Top 50 is based on both revenues and year-on-year growth. Revenues comprise 75% of the composite score used for ranking. Growth comprises 25% and has two sub-parameters: absolute growth (measured as change in ES revenue in US$ million and accounting for 12.5% of the composite score) and percentage growth (measured as percentage change in ES revenue and accounting for the final 12.5% of the composite score).

 About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

COVID-19, Recession Deal Double Whammy to Property & Casualty Insurance BPS Industry | Press Release

Everest Group estimates the P&C insurance BPS industry, currently measured at US$2.4 billion, will attain only single-digit growth through 2020.

The COVID-19 pandemic has dealt a blow to the Property & Casualty (P&C) insurance industry, and the current recession is exacerbating the impact, according to Everest Group. Consequently, Everest Group is revising down its projected growth rates for the P&C insurance business process services (BPS) market. Everest Group estimates the P&C insurance BPS industry, currently measured at US$2.4 billion, will attain only low single digit growth rather than the double-digit growth previously expected, putting a question mark on the market’s ability to cross US$3 billion by 2022.

The P&C insurance BPS growth rate in 2018-2019 (approximately 10%) was already the lowest it had been in the past four years, due to the strong linkage of the market to economic cycles and the recessionary prospects that had begun to surface. Then came the COVID-19 pandemic, which has negatively impacted both the personal and commercial lines of the P&C insurance industry, and a fully recognized recession with poor recovery prospects for the near future.

The P&C insurance BPS industry is expected to bear a four-fold impact from the pandemic:

  • Operations: Business operations will be disrupted mainly due to reduced mobility and difficulties of working from remote environments. For example, IT infrastructure is strained, and physical inspection of claims is more challenging.
  • Costs: Costs will depend on how reduction in claims, drastic measures of liquidity preservation, and increasing litigations against insurers play out. For example, auto claims will likely fall due to reduced driving, but lawsuits for not covering business interruption losses caused by the shutdowns will add to insurers’ costs.
  • Customer demand: Customer demand will vary across different product segments, ranging from high to extremely strained demands, making the demand landscape diverse in terms of the impact. Customer demands may include specific product lines such as cybersecurity and directors and officers (D&O) insurance. Customers also will likely demand more value for their money, increasing the chances of switching based only on premium prices.
  • Compliance: A host of compliance and regulatory measures will have to be introduced to protect all the affected stakeholders amidst the evolutionary landscape. For instance, pressure to extend coverage for cybersecurity attacks and business interruption losses will increase.

“With the extreme shifts in business environment due to COVID-19, both for insurers as well as their service partners, many have struggled for even basic operational continuity,” said Skand Bhargava, practice director at Everest Group. “While the industry has now largely adjusted to the vagaries of the changed operating environment, these changes appear to be more permanent than expected. The P&C insurance BPS market is expected to transition through significant operating model and engagement structure changes. Now, with the onset of a recession, it is even more imperative for service providers to understand the developments in insurers’ sourcing strategies and the implications on future sourcing requirements.”

In particular, Everest Group recommends that providers tap into these emerging trends:

  • Localized delivery with greater onshore/nearshore mix
  • Talent upskilling to move up the value chain
  • Expanding first-time buyer engagements
  • Transformation consulting to enable buyers to adapt their operation models to the new demand environment
  • Adding more digital point solutions to the outsourcing levers mix.

These findings are discussed in detail in Everest Group’s new report, “Property & Casualty (P&C) Insurance BPS State of the Market Report 2020: Deconstructing the Present and Expected Future of Sourcing Strategies.” In this report Everest Group offers a detailed analysis of third-party outsourcing of business process services in the P&C insurance industry, including market size and growth, adoption trends, present and expected sourcing strategies, and action items for service providers.

***Download the complimentary report abstract.***
***Also, visit Everest Group’s COVID-19 page for a Global Service Delivery tracker, recent reports, webinars, and more.***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. Our clients include leading global enterprises, service providers, and investors. Through our research-informed insights and deep experience, we guide clients in their journeys to achieve heightened operational and financial performance, accelerated value delivery, and high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com/.

 

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