Category: Press Releases

Life & Pensions Insurance BPO Will See 9-11% Growth in 2020 as End-to-End Third-Party Administration Grows—Everest Group | Press Release

L&P insurance BPO scope of services will expand beyond traditional policy administration to value-additive services such as product launch and distribution channel expansion.

Everest Group predicts 9 to 11% growth in the Life and Pension (L&P) insurance business process outsourcing (BPO) market in 2020 on the heels of 9% growth in 2019. Everest Group projects the industry’s most prominent trend in 2020 will be a growth in demand for end-to-end third-party administration (TPA) services and Business Process as a Service (BPaaS).

The L&P insurance BPO market has seen a consistent pace of year-on-year growth in the range of 9 to 10% since 2014 as the industry has experienced a modest evolution in buyer-service provider relationships. L&P insurance third-party outsourcing arrangements are moving beyond transactional services to strategic business growth and transformation support. For example, high-growth services include new product launches, expansion of distribution channels, and customer financial advisory services.

Service providers’ expansion of capabilities to more value-additive services is also absolutely necessary for competitive differentiation, since higher straight-through processing, self-service, and automated process will make the traditional policy administration services more standardized across providers.

To differentiate and also accommodate the growth in demand for end-to-end TPA/BPaaS services, almost all the major service providers continue to invest in core policy administration platforms, digital augmentation applications and talent capabilities.

“In 2020, buyers in the L&P insurance BPO market will significantly favor service providers that have shifted their core value propositions to align with buyers’ strategic growth priorities,” said Skand Bhargava, practice director, Business Process Services, at Everest Group. “In the coming year, we will see third-party outsourcing partnerships redefined around customer satisfaction, digital transformation, operational optimization and innovation in product development and distribution. Many of these demands require digital capabilities, including cloud-based platforms, analytics, and robotic process automation. As a result, we inevitably will see those service providers who have invested in these capabilities widen the competitive gap in the service provider landscape.”

These findings are discussed in more detail in “Life and Pensions (L&P) Insurance BPO: Annual Deal Trends Report 2020.” This report provides a detailed analysis of the L&P insurance BPO market size and growth, buyer adoption trends, solution characteristics, and service provider landscape; it also features a focused analysis of the annuities and pensions BPO market.

Other Key Findings:

  • While new contract signings are declining, the end-of-life legacy systems and the need to free up capital for new-age investments are collectively contributing to larger deals in the market.
  • Apart from the traditional geographies, such as North America and the United Kingdom, the emerging markets are also witnessing decent activity. Asia Pacific and Latin America, with their L&P insurance market growth prospects, would provide greater opportunities in the long term
  • There is a general trend toward expansion of onshore delivery as it allows for quality engagements with buyers.
  • Output-based pricing continues to dominate the market; new-age models such as gainsharing are also witnessing increased interest.
  • The annuities market constitutes more than 35% of the overall L&P insurance BPO market and has been growing at above the market average rate.

***Download the complimentary report abstract.***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

Outsourcing Demand Shrinks for Third Consecutive Quarter, According to Everest Group Report on Top Trends in Global Sourcing | Press Release

Bright spots in global sourcing for Q3 include GIC setups, digital services and revenues for offshore heritage providers.

The global sourcing industry posted a 6.7% decline in transactions in the third quarter of 2019, dropping to 444 transactions from 476 transactions recorded in Q2, according to Everest Group. This marks the third consecutive quarter of declining transactions in 2019. From a year-on-year perspective, transactions declined 15.6% from 526 in Q3 2018 to 444 in Q3 2019.

Everest Group also reports these Q3 statistics indicating suppressed growth in the global sourcing market:

  • The total spending on outsourcing contracts fell across the US and Europe (especially the UK) owing to global recessionary sentiments.
  • Offshore heritage service providers have announced considerable layoffs in this quarter to streamline their delivery pyramids and reduce costs.
  • The revenue for global services providers decreased marginally.
  • Both merger and acquisition (M&A) and alliance activity witnessed a decline.

However, within the global outsourcing activity for Q3, a few bright spots appeared:

  • India witnessed growth in activity driven by an increase in new global in-house center (GIC; also known as shared services center) setups, specifically for supporting engineering and digital-focused services.
  • The volume of digital-focused new centers increased both in the onshore as well as the offshore region, with artificial intelligence (AI) continuing as the leading segment across both regions. The activity was largely driven by India and China in offshore/nearshore regions and by the United States in the onshore region.
  • Technology and communication remained the most active sector in offshore/nearshore and onshore locations and accounted for 63% and 50% of total new center setups, respectively. During the quarter, the retail and consumer product goods (CPG) vertical gained traction in onshore locations with nine new setups, compare to four in Q2.

These global sourcing trends are detailed in Everest Group’s recently released Market Vista™: Q4 2019 report. The Market Vista report provides data and analysis highlighting the key trends in the fast-evolving offshoring and outsourcing market. Market Vista captures the key developments across outsourcing transaction trends, health of GICs, location risks and opportunities, and service provider developments.

Special Focus: Engineering/R&D Sourcing
The Market Vista: Q4 2019 report profiles outsourcing activity in the engineering/R&D space, including an overview of spending and a growth outlook across sectors. In 2018, the enterprises featured in the ER&D Top 200 across eight industries accounted for 56% of the overall ER&D spend globally. By sector, software vendors emerged as the highest spender ($127 billion), edging out the automotive sector, which led in 2017.

“In 2019, we expect the software product industry to remain in the top spot for ER&D spending, probably in the 15% growth range, as enterprise software vendors continue to explore offerings around emerging tech themes,” said H. Karthik, partner, Global Sourcing, at Everest Group. “The medical device sector is expected to experience the next highest growth rate in engineering/R&D spend, driven by software integration in medical devices and the growth of the wearables sector.”

***Download a complimentary 14-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. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

‘Uncertainty Rules Supreme in 2020’ Predicts Everest Group, Based on Survey of Enterprise Execs | Press Release

Three trends will gain momentum, shape enterprise investments next year: customer experience (Cx), digital & data, and the contingent workforce.

Based on a November market survey of enterprise executives, Everest Group predicts that uncertainty will rule supreme in 2020, despite current positive market conditions and better-than-expected enterprise performance in 2019.

With 2020 fast approaching, Everest Group polled 130 senior enterprise stakeholders from Global 1000 companies on their thoughts about growth prospects, investment priorities and challenges they expect for the new year.

The good news from the study: Senior enterprise stakeholders ended 2019 with a slightly more optimistic sentiment about their 2019 performance as compared to their original expectations for the year. Forty-three percent of respondents indicated they had a slightly better than expected (32%) or fantastic (11%) year.

The bad news: Despite positive market conditions that should be creating certainty and high optimism for 2020 — such as historically high stock market, low unemployment, and low interest rates ― market UNcertainty continues to create a drag on industry optimism. In fact, Everest Group reports that organizations are bracing for slower growth in 2020.

Only 45% of enterprise executives surveyed this year are optimistic about growth in 2020, as compared to 57% who expected growth in 2019. Twenty-eight percent of enterprise executives interviewed this year expect flat performance or even a decline in 2020, an increase from 22% who held a negative outlook for 2019.

Whereas enterprise executives projected 2019 revenue growth of 7.6% and headcount growth of 5.1%, executives today project lower growth rates for 2020: 5.4% revenue growth and 3.9% headcount growth.

Based on responses to questions about investment priorities and challenges anticipated for next year, Everest Group predicts that 2020 will be the year when three major trends gain momentum:

1. Customer experience is king. Forty-five percent (45%) of respondents selected customer experience as the top investment priority and the most critical change that must be made in their business model. This remains true even in an economic downturn. When asked to identify top investment priorities for 2020 should the economy strengthen versus if the economy weakened, senior enterprise executives typically had two very different lists, except for their top priority—customer experience—which remained the same for both scenarios.

2. Enterprises do digital and data, or die. Enterprises either learn to do tech or fall too far behind to survive. Rapid technology advances are a key lever to improving customer experiences. To that end, analytics, cloud solutions and automation (RPA) rank highest (in that order) among the capabilities enterprises most seek to develop.

3. The contingent workforce becomes a powerful force for change. A shortage of next-generation skills remains a huge challenge for enterprises. Organizations must treat the contingent workforce not as an inconvenient fringe element in their businesses but as a strategic asset. The contingent workforce is a key part of the labor pool in many organizations, especially for groups like IT. In fact, Everest Group research indicates that 36% of enterprises classify more than 16% of their workforce as contingent workers, a workforce segment that is increasing in size and scope.

“Despite the uncertainty facing enterprises in 2020, the opportunity to win remains, and the stakes to capitalize on the right investments are higher than ever,” said Michel Janssen, chief research guru for Everest Group. “For example, we know that digital transformation is a key investment priority, and rightly so. However, even the best companies are still unable to take advantage of the dizzying array of new digital technologies – and the gap grows for the rest. We’ll see the same dichotomy play out in the areas of customer experience and contingent workforce as well. Those who invest and successfully execute will be few, and the rest will lag behind. Should the uncertainty and slow growth that enterprise executives predict truly bear out in 2020, the gap between leaders and followers will be all the more pronounced.”

***WEBINAR: Thursday, December 5, 9 am CST. ***

The results of this research will be presented by Janssen and Eric Simonson, managing partner at Everest Group, during a complimentary webinar on Thursday, December 5, at 9 am CST. The webinar — “2020 Enterprise Key Issues in Global Sourcing: Setting Course When Uncertainty Rules Supreme” — will cover:

  • Common sentiments expressed by enterprise executives during Everest Group’s recent market survey on enterprise key issues
  • Leading implications for enterprises engaged with service providers and key value propositions to consider for both insourcing and outsourcing
  • Potential enterprise adjustments around service provider portfolio consolidation, deal size, and value realization

Register here: 2020 Enterprise Key Issues in Global Sourcing: Setting Course When Uncertainty Rules Supreme.

About Everest Group

Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

Rapid Adoption of Multi-Country Payroll Solutions Continues, Driving 19% Growth in Worldwide Market—Everest Group | Press Release

Enterprises still love the cost savings and compliance offered by MCP solution providers but also demand analytics, AI, RPA to improve employee experience with unified HR and payroll systems.

Multi-Country Payroll (MCP) solutions—one of the fastest-growing markets in the human resources (HR) outsourcing space—will continue to grow rapidly, reaching US$3.3 billion by 2021, according to Everest Group.

The MCP solutions market witnessed approximately 20% growth between 2017 and 2018. This growth was driven primarily by mature providers offering traditional process efficiency benefits. As enterprises seek compliance, security and cost savings in their MCP processes, they are confidently turning to several mature MCP service providers who dominate the market today.

In addition, the MCP solutions market has received a boost from the rise in regulatory requirements across many regions, which is encouraging many first-time adopters to outsource their payroll to service providers. This has given rise to new players in the market, catering to the small-sized buyers of MCP solutions, which are typically multinational corporations spanning two to five countries.

“Although MCP service providers have performed well with respect to the traditional drivers such as cost reduction and compliance, buyers expect more in terms of next-generation technologies and strategic support,” said Anil Vijayan, vice president, Business Process Services, at Everest Group. “In fact, the drivers for adoption of MCP solutions are slowly shifting from traditional to next-generation expectations. These include offering a better employee experience, gaining insights through analytics, and the application of digital solutions such as artificial intelligence and robotic process automation. As the market evolves, service providers will need to continue to innovate and differentiate themselves to provide a better payroll experience to clients and maintain a strong foothold in the market.”

Everest Group explores these findings and others in a recently published report: “Multi-Country Payroll (MCP) Solutions Annual Report 2019 – Moving Toward Unification of Payroll and HR Services.” This research provides a comprehensive analysis of the global MCP solutions market across various dimensions, including a market overview; trends in buyer adoption, transactions and solutions; and the service provider landscape.

Additional key findings in this report include:

  • The market trend is for enterprises to unify payroll and HR services, typically comprising four elements: consolidation of geographical operations, integration with HR services, integration with wellness and benefit offerings, and the tie-up of payroll and other ancillary processes.
  • Europe has emerged as the dominant market in terms of MCP solution revenue. The North American and Asia Pacific markets closely follow suit.
  • The overall technology model for payroll has largely been skewed toward the integrated hybrid and single platform model as service providers look to provide a seamless payroll experience to clients with more focus on self-coverage.
  • The leading players in the MCP solutions landscape have constantly innovated and invested in developing technological capabilities to differentiate themselves from other players in the market.

***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. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at https://www.everestgrp.com.

85% of Enterprises Report That Modern IT Infrastructure Is the Bedrock of Digital Transformation—Everest Group | Press Release

Most enterprises believe their IT infrastructure isn’t future-ready. Everest Group says enterprises need ‘invisible’ Infrastructure 3.0, underpinned by AI, analytics and automation, to drive digital transformation.

According to Everest Group, nearly 85% of enterprises believe that IT infrastructure is the bedrock of business transformation initiatives; however, most enterprises believe that their current IT infrastructure services model is not ready to cater to their digital needs.

Everest Group asserts that digital enterprises need to consider a new model for IT infrastructure – Infrastructure 3.0, where the focus of IT infrastructure management is on improving business metrics instead of pre-defined IT SLAs and TCO management. Infrastructure services need to be underpinned by artificial intelligence (AI), analytics, and automation to drive self-healing, self-configuring systems that can dynamically and autonomously adapt to changing business needs, thus creating an “invisible” infrastructure model that is highly secure and requires minimal oversight.

“With the concept of ‘invisible infrastructure,’ we’re suggesting that IT infrastructure must evolve to become a proactive enabler of business innovation with minimal human intervention,” said Chirajeet Sengupta, partner, Information Technology Services, at Everest Group. “To achieve Infrastructure 3.0, enterprises must focus their IT investments on the three I’s—invincible, interoperable and intelligent. In other words, enterprise must build a resilient and secure infrastructure that protects the business, is seamlessly interoperable across stacks, and uses intelligent tools to continuously evolve with business needs.”

Detailed recommendations for achieving Infrastructure 3.0 are offered in Everest Group’s recently published report, “Exploring the Enterprise Journey Towards ‘Invisible IT Infrastructure’: Cloud and Infrastructure Annual Report 2019.” This annual research also deep dives into the cloud and infrastructure services (IS) landscape. It provides data-driven facts and perspectives on the overall market. The research covers cloud and IS adoption trends, demand drivers, and buyer expectations. The research analyses buyer challenges, trends shaping the market, and provides an outlook for 2019-2020 for the broader IT as well as cloud and IS market.

Highlights of the Cloud and IS market analysis:

  • Enterprises’ need for business transformation has increased the number of consulting-led IS engagements: 68% of IS engagements in 2018 had consulting services in their scope.
  • Change management initiatives will be crucial for service providers going forward, as adoption rates are a crucial metric for buyers.
  • The cloud and infrastructure market in the telecommunication industry in North America is booming primarily due to focus on 5G implementation. Adoption within the retail industry is driven by buyers focusing on enhancing customer experience with digital initiatives.
  • Going forward, enterprises expect infrastructure services to enhance business metrics in addition to reducing costs through outsourcing.
  • Vendor-agnostic behavior will continue as buyers expect agile and continuous innovation and higher value from outsourcing contracts.
  • Cloud adoption is rising, with hybrid cloud becoming the preferred model for enterprises. Service providers are best placed for solutions that will enable hybrid cloud as well as multi-cloud adoption amongst enterprises.
  • Service providers need to provide interoperable infrastructure capabilities to enable enterprises in their digital journeys.

***Download a complimentary 12-page abstract 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. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

Demand for Contingent Workforce Drives Another Year of Double-Digit Growth in Managed Service Provider Market | Press Release

What enterprise buyers want from MSPs is rapidly evolving beyond cost reduction and compliance to next-gen services like inclusion of services procurement (SOW), direct sourcing, contingent talent branding, analytics and automation.

Economic uncertainty and millennial workers’ preferences for workplace flexibility are pushing organizations to leverage contingent workers in their workforce. On the back of this rising demand for contingent workforce across geographies and industries, the global Managed Service Provider (MSP) market has continued its double-digit growth momentum (13%) in 2018. According to Everest Group, the total annual contingent spend managed by MSP service providers stood at US$144-149 billion in 2018. More importantly, MSP spend is expected to grow at a rate of 10-12% to touch US$160-165 billion in 2019.

Organizational challenges also are contributing to the rising demand for contingent workers. These include scarcity in the talent market, the availability of niche skills in the contingent segment, and the need for organizational flexibility and scalability.

“As the preferences of workers evolve, organizations must adopt new ways of engaging with the specialized knowledge workers they seek,” said Vishal Gupta, practice director, Business Process Services, at Everest Group. “Increasingly, organizations are engaging Managed Service Providers given the rapid evolution of contingent workforce and the technological innovation happening in this space. The scope of services being delivered by MSPs has expanded greatly and will continue to do so as buyers look to their MSPs for managing SOW spend, direct sourcing, automation, consulting, analytics and insights, total talent acquisition, and other strategic services beyond the traditional, transactional activities of recruiting temporary workers.”

These findings are discussed in more detail in Everest Group’s recently released report, “Managed Service Provider (MSP) – Annual Report 2020: Leading Through Market Disruption.” This research provides comprehensive coverage of the market across dimensions such as MSP market size and growth, key MSP market themes, and buyer adoption and solution trends.

Everest Group identifies these key themes in the MSP market:

  • While traditional temporary labor still constitutes a major part of the MSP spend, services procurement / Statement of Work (SOW) spend managed by MSPs is slowly capturing an incremental share of the pie, owing to its rapid growth across regions.
  • In 2018, the market continued to witness an uptick in the number of requests for information (RFIs) for Total Talent Acquisition (TTA), which is the holistic management of all kinds of talent requirements of an organization (permanent and contingent hires) under one roof.
  • The market also witnessed faster growth in the mid-market segment compared to other markets, owing to increasing buyer interest and development of productized offerings by service providers.
  • Direct sourcing is increasingly being leveraged by enterprises and MSPs as an alternative sourcing mechanism due to its multiple benefits. (Direct sourcing involves leveraging enterprises’ employer brand to create internal and external talent pools to source candidates.)
  • Digital technologies in talent acquisition are advancing rapidly, and as the contingent workforce across industries and buyer segments is taking different shapes and forms, the role of technology in MSP is becoming all the more crucial.
  • Next-generation digital technologies—including advanced analytics, natural language processing (NLP), machine learning (ML), robotic process automation (RPA), and blockchain—are being increasingly leveraged in MSP engagements to create valuable insights, cost reductions, and superior experiences for both candidates and hiring managers. This is also prompting service providers to make dedicated investments to stay relevant in the increasingly competitive market.

***Download the complimentary report abstract.***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

Everest Group Identifies Six Enterprises with the World’s Most Innovative Procurement Operations | Press Release

Sourcing Innovation Pinnacle Enterprises™ set themselves apart with proactive innovation strategies, superior outcomes.

Research by Everest Group reveals that the world’s most innovative procurement operations are set apart by one rare but critical behavior: they take proactive steps to be innovative, whereas most other procurement operations are not even thinking about it. Everest Group has identified six Sourcing Innovation Pinnacle Enterprises™, set apart by their proactive innovation strategies and superior outcomes.

“Innovation in procurement has just scratched the surface of its full potential, particularly since so many powerful, new tools for analytics and automation and other digital solutions are emerging in the ecosystem,” said Michel Janssen, chief research guru for Everest Group. “However, a number of exceptionally performing procurement organizations have already set themselves apart by taking initiative, making the most of current technology, and not waiting for innovation to be mandated. These best-in-class sourcing operations, which we’ve deemed Sourcing Innovation Pinnacle Enterprises, are taking a proactive approach to building a culture of innovation in people, processes and technology. Whether it be their vision, organizational structure and personnel incentives or their investments in technology and ecosystem partnerships, their strategies are imbued with an innovation mindset, and as a result, they are reaping business benefits far beyond those of their peers.”

Everest Group, in partnership with Sourcing Industry Group (SIG) and SIGInnova, set out to determine:

  • The innovative procurement and sourcing practices that leading organizations are adopting.
  • The capabilities needed to drive successful innovation in procurement.
  • The technology innovations that are changing sourcing practices.

Everest Group assessed the sourcing innovation strategy and approach of 50 global enterprises representing more than a dozen industry sectors. Those enterprises that rated highest in terms of the maturity of their sourcing capabilities and the impact delivered were deemed Sourcing Innovation Pinnacle Enterprises™.

Sourcing Innovation Pinnacle Enterprises are delivering significant impact in three key areas:

  • Cost impact: Pinnacle Enterprises generated 50% higher percentage reduction in spend (under control) than other enterprises.
  • Operational impact: Pinnacle Enterprises achieved consistently high improvement in operational metrics through their sourcing innovation initiatives, especially on Key Performance Indicators (KPIs) such as reduction in cycle time, increased process accuracy, improved compliance and increased employee productivity.
  • Business impact: Pinnacle Enterprises significantly created business impact in areas such as increasing spend under management, improving vendor satisfaction, increasing spend visibility, and improving procurement’s reputation as a key partner in business innovation.

Sourcing Innovation Pinnacle Enterprises Honored at SIG Global Executive Summit

SIG, SIGInnova and Everest Group recognized the two Sourcing Innovation Pinnacle Enterprises that were recently in attendance at SIG’s Fall Global Executive Summit, CDK Global and VSP Global® .

“It’s an honor for CDK Global to be recognized as a Pinnacle Enterprise in Everest Group’s Sourcing Innovation Pinnacle Model,” said Mike Morsch, vice president of global procurement and supply chain at CDK Global. “CDK procurement is implementing an operating model focused on its people, core processes and technology enablement. This focus is helping us achieve substantive improvements in operational metrics while reducing procurement and business costs. Forward-thinking procurement leaders must also be technology leaders, driving investment and innovation in automation, digitalization and analytics.”

“This recognition is a great honor for VSP Global, but also a special tribute to our global sourcing and procurement team,” said Greg Tennyson, head of global corporate services at VSP Global. “Innovation is encouraged throughout our organization and our ability to embrace transformative change has propelled our enterprise forward by delivering significant cost savings, operational improvements, and business impact.”

Resources Available for Download
Everest Group describes in detail the differentiating strategies of Sourcing Innovation Pinnacle Enterprises in the report, “Sourcing Innovation: Pinnacle Model Analysis.”

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

Practical implications and best practices are also discussed in an Everest Group webinar, “Achieving Sourcing Innovation: Practices and Technologies Leveraged by Pinnacle Enterprises.” The webinar features Dawn Tiura, CEO and president of SIG.

***Watch the replay or download the webinar deck here.***

About the Pinnacle Model™
Everest Group’s Pinnacle Model™ approach explores what the very best organizations are doing in terms of optimizing costs, improving operations, and delivering strategic impact. The journeys of these best-of-the-best companies provide insights into the key enablers needed to achieve desired outcomes and point to the investments required for the greatest speed to impact. By examining what Pinnacle Enterprises have in common, others can learn how to succeed, whether they desire to make incremental changes or achieve major transformations.

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empower clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

Enterprise Adoption of RPA Doubles in 2018, Will Reach $2.5 B by 2020 | Press Release

Everest Group estimates 2.5 million attended robots and 0.8 million unattended robots will be running by 2020.

Encouraged by a growing number of success stories and positive word-of-mouth publicity, enterprises are increasingly investing in Robotic Process Automation (RPA). In fact, Everest Group predicts that the number of robotic desktop automation (RDA) robots running on users’ desktops, assisting agents and employees, will be close to 2.5 million by 2020. In addition, by 2020 there will be 0.7 to 0.8 million virtual workers or unattended RPA robots running on cloud and on-premise servers.

Enterprise RPA adoption, as indicated by the number of enterprise clients served by independent RPA vendors, grew 100-110% from 2017 to 2018, surpassing US$1 billion, according to Everest Group. Two-thirds (68%) of the revenue earned in the RPA software vendor market in 2018 came from RPA software licenses. The remaining 32% was from professional services such as consulting, training and implementation. The market is expected to grow at a compound annual growth rate of 70-85% between 2018 and 2020 to reach approximately US$2.5 billion.

Although the RPA customer base is growing at a fast pace across a wide spectrum of industries, geographies, and organization sizes, the majority of RPA buyers are still in an early adoption phase due to challenges faced while scaling up. Everest Group has identified the top five pain points enterprises experience when adopting RPA:

1. Lack of a robust RPA strategy and roadmap
2. Difficulty managing organizational change
3. Concerns about IT security and compliance
4. Lack of experienced RPA resources
5. Difficulty identifying use cases to maintain a healthy automation pipeline

“Fortunately, the RPA ecosystem is evolving to address the scale-up challenges of enterprise adopters,” said Sarah Burnett, executive vice president and distinguished analyst at Everest Group. “We see the technology overall becoming smarter and more robust with deeper capabilities thanks to advances in AI, machine learning, deep learning and natural language processing. Plus, RPA vendors are making significant investments in improving the customer experience, making training more accessible, and expanding their solutions by partnering with service providers and technology vendors. And enterprises themselves are sharing best practices to help others advance more quickly along the adoption curve.”

These findings and more are discussed in a newly released Everest Group report, “Robotic Process Automation (RPA) Annual Report 2019 – Laying the Foundation for a Light-touch Organization.” This research explores RPA market size and adoption trends, buyer expectations, key challenges and best practices in the enterprise RPA journey, solution characteristics, technology trends, the RPA vendor landscape, and the outlook for 2019-2021.

A selection of key findings:

  • Industry-specific processes continue to see the highest adoption of RPA. Banking, Financial Services and Insurance (BFSI) and telecom accounted for over half of the overall RPA software market. Manufacturing as well as travel and logistics showed strong growth. RPA also witnessed significant traction among public sector organizations.
  • North America holds the lion’s share of the RPA market. APAC witnessed accelerated growth.
  • Buyers consider operational impact to be the most important factor driving RPA adoption, followed by cost impact, and buyers are satisfied with their RPA vendors in these aspects.
  • Top technology trends to watch include online digital worker marketplace, predictive SLA monitoring, and workload balancing.
  • Automation Anywhere, Blue Prism, and UiPath are the top three vendors in terms of RPA license revenue, closely followed by NICE. Pegasystems leads in terms of revenue from robotic desktop Automation (RDA)/attended RPA licenses.

***Download a complimentary abstract of the report. (Registration required.)***

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com

IDP Revenue Growth Expected to Exceed 80% in 2 Years as Enterprises Embrace More Powerful Technology, Mature Partners | Press Release

Most Enterprises Need Intelligent Document Processing: Everest Group Explains Why, Provides Roadmap for Adoption and Strategies to Improve ROI

In a competitive marketplace, companies that can minimize cost while increasing productivity, accuracy and efficiency are extremely likely to have an advantage over those who cannot. According to Everest Group, that is precisely why most companies need intelligent document processing (IDP) solutions and why the IDP market is expected to grow 80% between 2018 and 2020.

“We foresee tremendous growth in IDP in the near future, especially now that core IDP technologies have advanced far beyond optical character recognition,” explained Sarah Burnett, executive vice president and distinguish analyst at Everest Group. “IDP solutions are becoming progressively more sophisticated, offering enterprise-grade features and an enticing track record of successful pilot implementations, particularly in the banking and financial services industry, which was the early adopter of IDP technology. Also, vendors are offering more mature service capabilities enhanced with salient features like outcome-based pricing and package-based solutions.”

Everest Group defines Intelligent Document Processing (IDP) as any software product or solution that captures data from documents (e.g., email, text, pdf, and scanned documents), categorizes and extracts relevant data for further processing using artificial intelligence (AI) technologies such as computer vision, optical character recognition (OCR), Natural Language Processing (NLP), and machine/deep learning (ML/DL). These solutions can be integrated with internal applications, systems and other automation platforms. Adoption of IDP solutions can not only help enterprises achieve cost savings, but also improve their workforce productivity as well as employee and customer experience.

Common use cases of IDP solutions:

  • Banking, Financial Services, and Insurance: processing KYC documents, invoices, insurance claims, bank statements and checks
  • Healthcare and Pharmaceuticals: processing R&D data, patient onboarding, patient records, patient surveys, physician referrals, claim-related documents
  • Telecom: Processing proof-of-delivery information, custom declarations, driver logs and maintenance logs
  • Manufacturing: Processing invoices, order forms, change requests, proposals and quality assurance records
  • Travel and Logistics: Processing user documentation, invoices, proof of delivery, and purchase orders.

IDP solutions are rapidly replacing traditional OCR-based solutions for document extraction because IDP solutions are capable of processing documents with greater accuracy and are more resilient to changes in document templates than traditional OCR. For example, with the help of NLP, an IDP system can process complex unstructured documents and can also create summaries. Once an IDP system is trained using ML/DL, the system can achieve Straight Through Processing (STP), which is processing without human touch. The benefits include:

  • Increased productivity and efficiency of both digital and non-digital workforce
  • Improved employee experience
  • Improved compliance and governance
  • Faster turn-around times due to increased STP
  • Improved accuracy with minimal manual intervention
  • Streamlined document tracking
  • Reduction in the overall cost of processing huge volumes of data.

For enterprises interested in IDP adoption, Everest Group has published “Intelligent Document Processing (IDP) Playbook.” The playbook is designed to help enterprises conceptualize where they want to get with automating data capture, identify the capabilities they need to get there, and create a business case and roadmap for adoption. The playbook details a five-step process to adopt, expand and scale IDP solutions and also includes IDP market characteristics, challenges and best practices for adoption, enterprise case studies, and a future outlook for the IDP market.

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About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services and sourcing. We are trusted advisors to senior executives of leading enterprises, providers and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

The Siloed Walls of F&A Won’t Keep Transformation Out Any Longer | Press Release

F&A service providers expected to handhold enterprises through their transformation journey; FAO experiences double-digit growth in 2018.

The waves of digital transformation are crashing down the siloed walls around the traditional finance and accounting function (F&A), as enterprises demand more from F&A in an effort to remain competitive. According to Everest Group, as enterprises shift from legacy to digital-first business models, F&A departments are being held accountable for not only reducing costs but also increasing operational efficiency and making a greater business impact.

However, the F&A transformation journey is not an easy one. Typically, F&A functions are beset with many challenges from the outset, such as siloed operations, fraudulent transactions, lack of visibility, changing macroeconomic factors, multiple dependencies and touchpoints, fragmented technology architecture, delayed reporting and suboptimal cash flow.

In its recently published report, “Finance and Accounting Outsourcing (FAO) Annual Report 2019: Why, What, and How of F&A Transformation,” Everest Group explains why the traditional, siloed process improvement efforts of the F&A function must give way to a holistic, end-to-end transformational approach in order to reap sustainable benefits. Everest Group also elevates a critical component of F&A transformation efforts: a strategic service provider partnership.

“Service providers play a critical role in helping F&A departments make the transformation journey,” said Shirley Hung, vice president of Everest Group. “Service providers with strong capabilities in process improvement, digital transformation and talent management can handhold the enterprise as it moves through the process. In fact, the ideal partner is one who offers a platform-led approach, where all the digital levers are integrated, implemented and orchestrated with the right mix of process improvement and talent management to deliver optimal outcomes.”

Everest Group’s FAO Annual Report 2019 provides an in-depth discussion of what it takes to transform the F&A function and how a service provider partnership driven by business outcomes rather than service-level agreements (SLAs) achieves better outcomes.

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The report also offers an overview of the FAO market and service provider landscape, including the FAO Service PEAK Matrix™ Assessment 2019, which identifies Leaders, Major Contenders and Aspirants in the market based on providers’ vision, capabilities and market impact.

Highlights of the FAO Market Overview:

  • The global multi-process FAO market witnessed a strong growth of 8-10% in 2018 to reach US$8.6 billion, driven primarily by an increase in first-generation outsourcers, large-scale transformation deals and scope expansion in existing contracts.
  • Traditional industries such as financial services, manufacturing, high-tech & telecom, and retail continue to hold major share of the FAO market, while energy & utilities and healthcare sectors witnessed the maximum growth.
  • North America and Europe still dominate the market (with a decline in the United Kingdom), while the highest growth in adoption is seen in the Asia Pacific (APAC), Latin America (LATAM) and Middle East & Africa (MEA) regions.
  • Offshore/nearshore delivery continues to increase, with the majority of F&A services being delivered from India, the Philippines, and Poland.Although FTE-based pricing is still dominant, hybrid pricing models are increasingly being leveraged due to the growing adoption of technologies such as automation and a greater focus on achieving business outcomes.

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services and sourcing. We are trusted advisors to senior executives of leading enterprises, providers and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility, and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

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