Peter Bendor-Samuel Archives

Dilemma of Customers’ Increased Productivity or Service Providers’ Profitability | Blog

January 14, 2021

I previously blogged about the need for a new third-party services operating model that would be more productive and agile and focus far more on results. Though the industry was on the verge of moving to a new model, adoption was slow at first. Now, attraction for the move to a new model is picking up in the marketplace, but enterprise customers and service providers define expectations differently.

Crucial CIO Skills for Digital Transformation Success | Sherpas in Blue Shirts

June 1, 2018

What do CIOs making the most progress with digital transformation have in common? They know how to nurture cross-functional collaboration.

All companies are vulnerable to the threat of a competitor’s ability to create new value for customers. That’s why most companies today are considering the opportunities for creating new competitive advantage through digital transformation and virtually all CIOs view digital transformation as a top priority. However, Everest Group’s Pinnacle Model research of more than 200 leading companies finds that only 10 percent of CIOs and their IT organizations are in a state of readiness for digital transformation initiatives.

Through our investigation into these companies’ digital journeys, we identified Pinnacle Enterprises – those that were best prepared for digital change and achieved superior business outcomes because of their advanced capabilities. The outcomes are compelling. Consider these examples:

In 86 percent of the Pinnacle Enterprises, the IT organization enabled the enterprise to serve a new market or new customer segment, versus 43 percent of the “unready” enterprises.
In 95 percent of the Pinnacle Enterprises, employee productivity increased between 10-30 percent, versus 54 percent of the other enterprises we studied.
Of the enterprises implementing Robotic Process Automation (RPA), the Pinnacle Enterprises achieved 4X more ROI (100 percent) than the other enterprises (40 percent) and achieved implementation 3X faster.

Our research also identified the enablers and capabilities of Pinnacle Enterprises to achieve desired outcomes and accelerate timeframes. A notable enabler: We found 95 percent of Pinnacle Enterprises (vs. 58 percent of the other enterprises we studied) built a culture that is effective in collaborating across functions in an organization.

TCS wins $6 billion in contracts under a month | In the News

January 17, 2018

For several years under its previous CEO N Chandrasekaran, TCS achieved growth rates of 15 per cent-16 per cent even when it had hit $10 billion in revenues, way more than the No. 2 player in the Indian IT industry. Then, in the past couple of years, the company slowed down dramatically as customers looked at newer digital technologies that TCS and others were not fully prepared for. Now, Chandrasekaran’s successor, Rajesh Gopinathan, looks to be bringing the company back to its winning ways.

In less than a month, TCS has announced deal wins of nearly $6 billion, including a $690-million contract with Europe’s M&G Prudential that it announced on Tuesday. It’s a stellar feat that has left many in the Indian IT sector in awe of the company’s deep client connects and robust execution engine.

Peter Bendor-Samuel, CEO of outsourcing consulting firm Everest Group, said TCS is taking on the market with new vigour. “Last year, TCS rolled out a comprehensive strategy to address the markets’ move into a digital-first orientation. This involved increased investments in digital, reorganization of its operations to address the new realities of a digital marketplace, and new messaging for its marketing and sales teams,” he said.

Under Salil Parekh, Infosys looks for clarity on growth strategy | In the News

January 8, 2018

Infosys may offer clarity on growth strategies this week as the company gears up to announce its results for the first quarter under new CEO Salil Parekh. The Bengaluru-headquartered software services exporter will announce October-December quarter results on January 12. While equity analysts foresee a muted growth for Infosys in a seasonally weak quarter, they will keenly look forward to Parekh and management’s commentary on future growth drivers and articulate on status of the digital transformation journey at the $10.2-billion company.

While commentary on those decisions are important, the company’s revenue share from software plus services and platforms will, analysts say, be key to set the focus areas for management under Parekh. Peter Bendor Samuel, CEO at global IT research firm Everest Group, has broadly underlined the prospective strategies Parekh may look at.

WCIT/NASSCOM Amplify Digital Forum 2018 — February 19-21 | Event

January 3, 2018

Founder and CEO Peter Bendor-Samuel will be a key panel speaker at WCIT India & NASSCOM’s Amplify Digital Forum: Embedding Digital: DevOps, Automation and Cloud. The event is held on February 19-21 in Hyderabad, India. Peter will speak on how organizations can best pursue scaling up new digital technologies, such as Cloud, DevOps, and Automation, in the age of digital transformation.

When
February 19-21, 2018

Where
HICC
Hyderabad
Hall 2

Speaker
Peter Bendor-Samuel, CEO and Founder, Everest Group

Learn more and register

Infosys Welcomes New CEO Salil Parekh From Jan 2 | In the News

January 2, 2018

The newly appointed Infosys CEO and MD, Salil Parekh takes charge today as the Indian IT major aims to create a positive work culture, revive growth and boost revenue under his aegis.

It will be interesting to look out for whether Parekh strategizes on any ambitious revenue and margin target, something Sikka could not establish. “It will be important that he should not over promise on growth or margins when he does this. A major problem of past Infosys leadership has been setting unrealistic expectations at a time of industry change. He will need flexibility on margins as he builds the new digital Infosys and flexibility on growth as the new digital business cannibalizes the legacy book of business,” ET quoted Peter Bendor-Samuel, CEO of Everest Group, as saying.

As Salil Parekh takes over as Infosys CEO, tough task ahead to win over founders | In the News

January 2, 2018

Infosys CEO Salil Parekh takes charge of the company on Tuesday with the expectation that it marks a fresh beginning at the Bengaluru-based company. Infosys is looking to put aside annus horribilis that was 2017 — a year marked by a bitter, public fight between the founders and former CEO Vishal Sikka that eventually led to the latter’s departure.

Apart from managing the founders, who hold a near 13% stake in Infosys, Parekh’s immediate challenge will be to align the strengths of Infosys’ DNA and culture with the future strategy and direction of the firm and to decide quickly which of Sikka’s initiatives to keep investing in. It will be interesting to note whether he sets any ambitious revenue and margin target, something Sikka had but fallen woefully short. “It will be important that he should not over promise on growth or margins when he does this. A major problem of past Infosys leadership has been setting unrealistic expectations at a time of industry change. He will need flexibility on margins as he builds the new digital Infosys and flexibility on growth as the new digital business cannibalises the legacy book of business,” Peter Bendor-Samuel, CEO of Everest Group, said.

Retrospective on the 2017 Global Services Market | Sherpas in Blue Shirts

December 11, 2017

As I look back on this year, it’s impossible to unplug digital from the determinants of the year’s most significant business changes. A review of how the rotation to digital impacted the global services market in 2017 provides a glimpse of factors that will be at play in 2018 as companies seek to be more competitive. In this blog, I’ll focus on three of the top factors that affected businesses this year.

Global Services Market Deceleration

Both the global services market and the Indian sector further decelerated this year. When we made projections for 2017, Everest Group was the only firm to make that call. In fact, although we were overly criticized for being overly pessimistic, the market decelerated even more than what we forecasted.

Deceleration is not the same as shrinkage. In the legacy space, the offshore labor arbitrage talent factories went from a growth space to a three percent contraction this year. Also, there has been portfolio rationalization and industry consolidation in that space. As the space shrinks, the larger firms do better than the smaller firms.

Related: 2018: The Year When Faking Digital Won’t Work Anymore

This year brought the rotation to digital with companies moving from services based on labor arbitrage to services based on disruptive digital technologies. The digital space now constitutes 25 percent of the overall market and is growing at 20 percent. The legacy arbitrage factory is 75 percent of the overall market and it’s shrinking at three percent. Within the shrinking, the big five Indian players are consolidating the market to take share; so they eked out a 1.5 percent growth while other providers shrank.

Interestingly, the compression driven by the cannibalization of digital and legacy environments is partially offset by new workloads coming into the legacy environment due to changes in market segmentation.

Market Segmentation Changing

A major factor at play in the services market in 2017 is the market beginning to segment between (a) digital transformation and (b) modernization of IT and business process services (BPS).

The digital market began splitting this year into two pieces: digital transformation vs. modernization. We clearly see two distinct, separate markets emerging in digital. This year we also saw digital transformation pilots go into programs. Pilots that ranged in size from $500,000 to $2 million in size now consistently hit between $50 million to $500,000,000 billion.

The legacy environment is also splitting into two markets: work that will be modernized and work that is too risky or expensive to modernize. We’re now 30 years beyond the inflexion point of where the market began moving from mainframe to client-server environments. Many companies still have a portfolio of applications remaining on mainframes. This is a classic example of legacy work that is too expensive or risky to modernize. As a result, companies are content at this point to let that work remain in the legacy structure. However, this year clearly brought movement in this space of companies building APIs and microservices to connect with that work, whether it is in an internal legacy infrastructure or in an outsourced legacy talent factory. This enables the companies to turn their attention to the work that they need to modernize.

What we haven’t seen is business process services (BPS) modernization take hold. IT is leading the pack currently. At the beginning of the year, we thought that BPS might lead the modernization, but it turns out we were wrong. The IT segment is moving much faster than the BPS segment in modernization work.

Rise of Small Firms

Also in 2017, we saw the rise of small provider firms. Where we see industry consolidation on the legacy side, we see vendor proliferation on the digital side. We believe this proliferation is because companies are looking to new firms to do new work. They believe the incumbent service providers are distracted and have a conflict in interest in moving to digital – a self-interest in preserving their profitable legacy arbitrage-based work. Consequently, this year brought a surge in companies looking to smaller, new service provider firms to help them understand and drive both digital transformation and IT modernization.

Salil Parekh takes charge: Will he continue with Vishal Sikka’s vision for Infosys? | In the News

December 5, 2017

Infosys’ new chief executive Salil Parekh should focus on building a strategy on top of the digital transformation approach that his predecessor began, and take advantage of being based in Bengaluru, the headquarters of the company.

“Given his past record and the board’s forward looking statements it seems likely that the general direction and strategy under Sikka will continue,” said Peter Bendor-Samuel, the CEO of research firm Everest Group.

Infosys’ new CEO Salil Parekh has challenging task on hand | In the News

December 4, 2017

In many ways, Infosys has pulled a rabbit out of its hat by appointing Salil Parekh as its CEO and MD who will take over his new position on January 2.

A member of the Group Executive Board of the Euro 12.54 billion French consultancy major, Capgemini, Parekh was never seen as a front-runner for one of the most coveted jobs in the Indian technology space.

But his track record shows that Infosys couldn’t have picked a more suitable person to head the organization. Parekh was at the forefront of the acquisition of the company he worked for, Ernst & Young’s consultancy division by Capgemini in 2000 and was widely credited for bringing scale and value to the Indian operations of the consultancy firm. In 2015, he led from the front for the acquisition of i-Gate for $4 billion.

Peter Bendor-Samuel, the CEO of Everest Group, an advisory firm Capgemini told an Indian newspaper in 2015 that Capgemini has realized 10 times more growth than what Parekh had promised Pierre-Yves Cros, the chief development officer of Capgemini.

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Tag: Peter Bendor-Samuel