EMEA Outsourcing Index Third Quarter 2015 Market Data and Insights

© 2015
Information Services
Group, Inc.
All Rights Reserved
isg-one.com
*Contracts with ACV ≥ €4M from the ISG Contracts Knowledgebase®
1
Hosted by:
John King
Bank of America Merrill Lynch
19 October 2015
The ISG Outsourcing Index®
Third Quarter 2015
EMEA Market Data and Insights

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
2
Covering the state of the outsourcing industry for EMEA commercial contracts.*
Welcome to the 52nd Quarterly ISG Outsourcing Index™ Review
Bernd Schaefer
Partner
John Keppel
Partner & President

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
3
At a Glance
YTD YTD
ACV (€B)* Change
€ 16.8 -11%
€ 10.7 -11%
€ 6.1 -11%
€ 2.5 -47%
€ 11.8 -19%
€ 5.0 17%
€ 7.3 4%
€ 7.8 -16%
€ 1.7 -34%
Scorecard 3Q15 3Q Y/Y 3Q Q/Q
ACV (€B)* Change Change
Global Market € 5.6 0% -9%
New Scope € 3.8 8% 5%
Restructurings € 1.8 -13% -29%
Mega-relationships € 0.9 -26% 126%
ITO € 3.6 -15% -23%
BPO € 2.0 53% 40%
Americas € 2.4 -1% -12%
EMEA € 2.7 0% -5%
Asia Pacific € 0.5 13% -12%
CONTRACT AWARDS UP ALMOST 20% Y/Y, YET GLOBAL MARKET VALUE (ACV) IS FLAT
BPO ACV UP MORE THAN 50% Y/Y ON STRENGTH IN CONTACT CENTER AND INDUSTRY-SPECIFIC BPO
AMERICAS PASSES €2 BILLION IN ACV IN FIVE OF THE LAST SIX QUARTERS;
CONTRACT AWARDS JUMP 31%, ALTHOUGH ACV IS ESSENTIALLY FLAT Y/Y
EMEA ACV FLAT Y/Y; DACH MARKET, FINANCIAL SERVICES SHOW STRENGTH;
MANUFACTURING AWARDS HIT 8-YEAR LOW
ASIA PACIFIC ACV UP 13% Y/Y, AS ANZ ACTIVITY REMAINS UNEVEN
YTD CONTRACT COUNTS AT ALL-TIME HIGH, WITH DEALS UNDER $40 MILLION (ACV) DRIVING MARKET;
YTD ACV DOWN 11% OVERALL

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
4
3Q15 Global Market ACV is flat Y/Y with the number of 3Q awards up 19% Y/Y. YTD,
ACV is down 11% as smaller deals drive market activity.
Broader Market Quarterly ACV (€B)* and Counts
YTD Broader Market Counts
Global Market Contract Award Trends
1,0941,016925950976
844784693
554529
386
319312334
271312
233
189212
1,402
1,2441,2621,310
1,1151,096
926
743741
201514131211100908072006
YTD Counts 4Q Counts
YTD Broader Market ACV (€B)*
€ 4.5€ 4.9
€ 4.0
€ 5.3
€ 4.5
€ 5.4€ 5.2
€ 3.9
€ 5.1
€ 3.2
€ 4.8€ 4.6€ 4.8€ 5.2€ 5.7€ 6.0
€ 5.3
344
448
302
386
288
373355
319
378
235
312312
263
315
372
334316
3Q153Q143Q133Q123Q11
ACV Counts
€ 13.4€ 15.1€ 13.1
€ 15.8€ 13.9€ 14.4€ 12.5€ 12.4
€ 9.9€ 10.3
€ 5.3
€ 3.9
€ 4.6€ 6.0€ 4.7
€ 6.0€ 4.3
€ 5.1€ 3.8
€ 20.4
€ 17.0
€ 20.4€ 19.9€ 19.1€ 18.5
€ 16.7
€ 15.0€ 14.1
201514131211100908072006
YTD ACV 4Q ACV

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
5
€ 4.2
€ 2.1
€ 4.4
€ 1.7
$0
$2
$4
$6
$8
New Scope Restructuring ITO BPO
Range of Prior 4 YTDs Avg of Prior 4 YTDs
YTD 3Q14 YTD 3Q15
3Q15 EMEA ACV is flat Y/Y with counts up 7%. YTD EMEA ACV is down 16% with
slowing contracting activity. Smaller awards are becoming more frequent.
EMEA YTD ACV (€B)*
EMEA Contract Award Trends
EMEA Quarterly ACV (€B)* and Counts
EMEA YTD Segment ACV (€B)*EMEA YTD Counts
431462451426460
356353320
248219
180163149
166
140146
98
8599
642614
575
626
496499
418
333318
201514131211100908072006
€ 2.1€ 2.3
€ 1.9
€ 2.7
€ 2.1
€ 2.6€ 2.7
€ 2.1
€ 3.1
€ 1.9
€ 2.2€ 2.3€ 2.5
139
168
124
180
130
157
175
163
185
121
145149
119
3Q153Q143Q133Q12
ACV Counts
€ 6.2€ 7.4€ 7.2€ 7.8€ 7.7€ 6.8
€ 5.4
€ 7.1
€ 4.8€ 4.0
€ 2.7€ 2.1
€ 2.3€ 3.5
€ 2.9
€ 3.4
€ 1.9
€ 2.1
€ 1.8
€ 10.1
€ 9.3
€ 10.1
€ 11.2
€ 9.7
€ 8.8€ 9.0
€ 7.0
€ 5.9
201514131211100908072006
YTD ACV 4Q ACV

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
6
€ 2.30
€ 1.54
€ 0.56
€ 0.25
€ 0.49 € 0.44 € 0.47
€ 0.19€ 0.0
€ 1.0
€ 2.0
€ 3.0
€ 4.0
U.K. & Ireland DACH Nordics France Benelux Southern
Europe
Africa &
Middle East
E. Europe &
Russia
Range of Prior 4 YTDs Avg of Prior 4 YTDs YTD 3Q14 YTD 3Q15
YTD, ACV in the U.K. is down 2%, but counts are up 35%. Nordics and France hit YTD
lows. The Financial Services industry continues to dominate EMEA activity.
EMEA Sub-regions YTD ACV (€B)*
EMEA Industry YTD ACV (€B)*
EMEA Contract Award Trends Detail
€ 1.87
€ 0.69
€ 1.01
€ 0.82 € 0.75
€ 0.19 € 0.24 € 0.15
€ 0.53
€ -
€ 0.5
€ 1.0
€ 1.5
€ 2.0
€ 2.5
€ 3.0
Financial
Services
Manufacturing Energy Travel,
Transport
& Leisure
Telecom
& Media
Business
Services
Retail Consumer
Packaged
Goods
Healthcare
& Pharma

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
7
Co. Revenues < $2 BCo. Revenues $2 -10 B
ISG Sourcing Market Standouts in EMEA
All three company size groups experience a bit of turnover. Large multinationals and
providers with a strong local profile lead each segment.
1New to group as of the current quarter
Placements based on ACV of commercial contract awards in the past 12 months sourced from ISG Contracts Knowledgebase®.
Service providers in alphabetical order; no rankings implied.
Revenues sourced from Hoovers and individual company financial fillings
Co. Revenues > $10 B
SOURCING
STANDOUTS GROUPED BY COMPANY SIZE
The Building 10
Sourcing Standouts
The Breakthrough 10
Sourcing Standouts
The Big 10
Sourcing Standouts
Accenture
Atos
BT
Capgemini
Cognizant
HP
IBM
ISS Global1
TCS
T-Systems1
Capita
CGI
Computacenter
HCL
Infosys
Jones Lang LaSalle1
MITIE
Serco
Tieto
Wipro
InnerWorkings
ISON Group1
Kuehne & Nagel
Luxoft
MAYKOR
Mindtree
Transcom
Virtusa1
WNS
Xchanging

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
8
3Q15 Americas ACV is down 1% Y/Y, yet counts are up 31% Y/Y. Still, YTD ACV is up
4% as the trend toward smaller-deal growth is most prevalent in the Americas.
Americas YTD ACV (€B)*
Americas Contract Award Trends
Americas Quarterly ACV (€B)* and Counts
Americas YTD Segment ACV (€B)*Americas YTD Counts
543
432
362395389380329291233243
159
126123141
87
120
95
8285
591
488518530
467449
386
315328
201514131211100908072006
€ 2.0
€ 2.2
€ 1.7
€ 2.1€ 2.0€ 2.0
€ 1.7
€ 1.3€ 1.5
€ 0.9
€ 2.1
€ 1.7€ 1.6
165
235
143
159
126
175
131126
150
79
133123
103
3Q153Q143Q133Q12
ACV Counts
€ 5.9€ 5.7
€ 4.6
€ 5.7
€ 4.9
€ 6.5
€ 5.3
€ 3.9€ 3.7
€ 5.3
€ 2.1
€ 1.3
€ 1.7
€ 2.0
€ 0.9
€ 1.9
€ 1.6€ 2.3
€ 1.6
€ 7.7
€ 5.9
€ 7.4
€ 6.9
€ 7.4€ 7.2
€ 5.5
€ 6.0
€ 6.9
201514131211100908072006
YTD ACV 4Q ACV
€ 3.3
€ 2.5
€ 3.9
€ 2.0
€ 0
€ 1
€ 2
€ 3
€ 4
€ 5
YTD 3Q14 YTD 3Q15

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
9
YTD, U.S. ACV is at its highest level this decade, up 4% over 2014. Growth in smaller
markets of Retail and Transportation supports the results.
Americas Sub-regions YTD ACV (€B)*
Americas Industry YTD ACV (€B)*
Americas Contract Award Trends Detail
€ 1.10 € 1.09
€ 0.62
€ 0.75
€ 0.58
€ 0.38 € 0.35
€ 0.51 € 0.47
€ -
€ 0.5
€ 1.0
€ 1.5
€ 2.0
Financial
Services
Manufacturing Telecom
& Media
Healthcare
& Pharma
Business
Services
Energy Consumer
Packaged
Goods
Retail Travel,
Transport
& Leisure
€ 0.34
€ 0.13
€ 0.06 € 0.09
€ 0.0
€ 0.1
€ 0.2
€ 0.3
€ 0.4
€ 0.5
Canada Brazil Mexico Other LatAm
€ 5.23
€ -
€ 1
€ 2
€ 3
€ 4
€ 5
€ 6
U.S.

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
10
ISG Sourcing Market Standouts in the Americas
Largest two tiers experience very little turnover as competition for the top spots
remains intense. Sutherland and EXL reach Top 10 status in the Breakthrough group.
The Building 10
Sourcing Standouts
The Breakthrough 10
Sourcing Standouts
The Big 10
Sourcing Standouts
SOURCING
Accenture
Atos
BT
Capgemini
Cognizant
Dell
HP
IBM
State Street1
TCS
Aon Hewitt
CGI
CompuCom
Convergys
Genpact
HCL
Infosys
Tech Mahindra
Teleperformance
Wipro
EXL1
Firstsource Solutions
ICF International
Luxoft
Minacs
Mindtree
Sutherland Global1
Syntel
UST Global
Virtusa

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
11
3Q15 Asia Pacific ACV is up 13% Y/Y with number of contacts up 25%. YTD, Asia
Pacific ACV is down 34% against 2014, with counts down 2%.
Asia Pacific YTD ACV (€B)*
Asia Pacific Contract Award Trends
Asia Pacific Quarterly ACV (€B)* and Counts
Asia Pacific YTD Segment ACV (€B)*Asia Pacific YTD Counts
120122112129127
108102
827367
47
30
4027
4446
40
2228
169
142
169
154152148
122
9595
201514131211100908072006
€ 0.41€ 0.47€ 0.44
€ 0.58
€ 0.37
€ 0.80€ 0.84
€ 0.46€ 0.40€ 0.44€ 0.44
€ 0.56
€ 0.76
40
45
35
47
32
41
49
30
43
3Q153Q143Q133Q12
ACV Counts
€ 1.33
€ 2.00
€ 1.29
€ 2.28
€ 1.37€ 1.11
€ 1.80
€ 1.30€ 1.36
€ 1.02
€ 0.58
€ 0.46
€ 0.56
€ 0.46€ 0.86
€ 0.67
€ 0.82€ 0.69
€ 0.33
€ 2.6
€ 1.7
€ 2.8
€ 1.8€ 2.0
€ 2.5
€ 2.1€ 2.0
€ 1.3
201514131211100908072006
YTD ACV 4Q ACV
€ 1.03
€ 0.30
€ 1.10
€ 0.33
$0
$1
$1
$2
$2
$3
YTD 3Q14 YTD 3Q15

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
12
All AP geographies decline YTD, with ANZ and Japan losing the most ground. With
the exception of Retail and Business Services, the decline crosses all industries.
Asia Pacific Sub-regions YTD ACV (€B)*
Asia Pacific Industry YTD ACV (€B)*
Asia Pacific Contract Award Trends Detail
€ 0.36 € 0.31
€ 0.21 € 0.16
€ 0.10 € 0.07 € 0.05 € 0.01 € 0.06€ 0.0
€ 0.2
€ 0.4
€ 0.6
€ 0.8
€ 1.0
Telecom
& Media
Financial
Services
Manufacturing Travel,
Transport
& Leisure
Energy Business
Services
Consumer
Packaged
Goods
Healthcare
& Pharma
Retail
€ 0.34
€ 0.42
€ 0.23 € 0.19
€ 0.14
€ 0.02€ 0.0
€ 0.2
€ 0.4
€ 0.6
€ 0.8
€ 1.0
ANZ India and South
Asia
Japan Greater China Southeast Asia South Korea

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
13
ISG Sourcing Market Standouts in Asia Pacific
Australian and India-based providers have a strong showing in the Building 10
group, while the Breakthrough 10 experiences a 30% turnover.
SOURCING
The Building 10
Sourcing Standouts
The Breakthrough 10
Sourcing Standouts
The Big 10
Sourcing Standouts
Accenture
BT
Cognizant
CSC
Fujitsu
Hitachi
HP
IBM
Ricoh
TCS
Amdocs1
Genpact
HCL
Infosys
NEC
Nihon Unisys1
Optus
Tech Mahindra
Transfield Services
Wipro
Aegis
ChinaSoft
Hollysys Automation
Minacs
NCS PTE1
Sutherland Global1
TeleTech
UXC1
Vertex
WNS

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
14
Special Topic for Third Quarter 2015
AUTOMATION, ROBOTICS AND CLOUD -THE ARC EFFECT-
DRIVE ENTERPRISES TO SOURCE IN NEW WAYS
John Keppel
Partner and President

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
15
The auto industry highlights the ARC effect
Looking at its sourcing history and its demands for new technologies, we can see
the effects on both sourcing industry leaders and new sourcing relationships
brought to bear as a result of new mega-trends.
Direct-to-customer
sales challenge the
value of dealers
Profit Margin Up
TOP 15 AUTOMAKERS in the last 10 Years
LITTLE TURNOVER
LIMITED ACQUISITIONS
HEAVILY MULTI-SOURCED
LOOKING AHEAD AT MASSIVE CHANGES
IN CONSUMER EXPECTATIONS FROM MULTIPLE DIRECTIONS
LOOKING BACK AT AN INDUSTRY
INVESTED IN SOURCING…
AUTOMAKERS ARE RESPONDING
BY CREATING DIFFERENTIATED TECHNOLOGY, ENABLED BY SOFTWARE, SENSORS AND TELEMATICS SYSTEMS.
MONETIZING DRIVER BEHAVIOR DATA
Fuel economy mandates
and green driving
increase costs
Generation Y
looking to
car-share, not own
DIGITAL-SAVVY DISRUPTORS JUMP IN

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
16
The ARC creates opportunities for Digital-savvy Disruptors
of Auto Manufacturing is
IT-DRIVEN SOFTWARE AND ELECTRONICS
INFOTAINMENT-GEARED IN-CAR SOFTWARE ►
a primary differentiator for many
manufacturers. Includes in-car systems like
Apple Carplay and Android Auto.
SEASONED ENGINEERS and USER INTERFACE DESIGN
EXPERTS boost the reliability of systems needing constant
updates via regression testing, patch distribution and
mobile platform as-a-service.
OWNERSHIP-FOCUSED IN-CAR SOFTWARE ►
Daimler’s “Mercedes Me” pulls together the
leasing, financing and service offerings into
an integrated platform.
PROVIDERS OF ANALYTICS SERVICES employed to gain
information through analytics, monetize the data by
increasing customer engagement and maximizing the
customer’s lifetime value.
Providers with DEEP VERTICAL EXPERIENCE and
DEV-OPS AND DATA-SCIENCE-DRIVEN DELIVERY
capabilities move beyond back office sourcing
to CAPTURE SIGNIFICANT NEW REVENUE
in the in digital-enabled world.
New Features Drive….. Innovation by Digital-savvy Disruptors
Automakers may
NOT HAVE THE SKILLS or scale
TO CREATE QUICKLY and
STAY COMPETITIVE.

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
17
3Q Global Market flat Y/Y; Americas and EMEA results are in line with prior
year 3Q, and AP is up 13%.
YTD the number of contracts hit an all-time high, but Global Market ACV is still
down 11%.
Structural aspects of the Market have changed, and the award profile is made
up of smaller deals under €40 million in ACV .
Expect an active 4Q15 and a strong start to 2016 with high award counts in
both the Americas and EMEA.
Deal values will remain smaller with the occasional large contract award
mixed in as businesses focus on areas like security, digital and cloud.
Even though the fourth quarter may be robust, deal activity will not be
enough to cover the YTD gap, and the Global Market will fall short of 2014
award levels by 7 to 10%.
3Q15 ISG Outsourcing Index® - Global Summary and Outlook
summary
market
outlook
market

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
18
Please contact us with your questions and comments.
Learn More
Paul Reynolds
Partner
+1 508 625 2194
paul.reynolds@isg-one.com
ISG insights serving providers and market analysts
www.isg-one.com
Denise Colgan
EMEA and AP Media Contact
+44 1737 371523
denise.colgan@isg-one.com
Laura Mountain
Cohn & Wolfe for ISG
+44 (0) 20 7331 5372
laura.mountain@cohnwolfe.com
John Keppel
Partner and President
+44 (0)7879 432 212
john.keppel@isg-one.com

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
20
The ISG Outsourcing Index has moved to ACV as the primary measure of the
Broader Market. We will continue to provide a high-level TCV view of the market via
a Scorecard analysis.
Third Quarter 2015 TCV Scorecard
*Contracts with TCV ≥ €25M from the ISG Contracts Knowledgebase®
Scorecard
3Q15 3Q Y/Y 3Q Q/Q YTD Y/Y
TCV (€B)* Change Change TCV (€B)* Change
Global Market € 21.0 -17% 5% € 62.8 -22%
New Scope € 15.3 -10% 10% € 45.3 -16%
Restructurings € 5.6 -32% -8% € 17.5 -36%
Mega-deals € 0.0 -100% 0% € 4.8 -68%
ITO € 13.0 -30% -10% € 43.7 -27%
BPO € 7.9 20% 42% € 19.1 -8%
Americas € 8.1 -30% 7% € 22.9 -22%
EMEA € 10.8 -8% 8% € 32.9 -18%
Asia Pacific € 2.0 -1% -14% € 7.1 -38%

© 2015
Group, Inc.
All Rights Reserved
isg-one.com
21
Information Services Group (ISG) (NASDAQ: III) is a leading technology insights, market intelligence and advisory services company,
serving more than 500 clients around the world to help them achieve operational excellence. ISG supports private and public sector
organizations to transform and optimize their operational environments through research, benchmarking, consulting and managed
services, with a focus on information technology, business process transformation, program management services and enterprise
resource planning. Clients look to ISG for unique insights and innovative solutions for leveraging technology, the deepest data
source in the industry, and more than five decades of experience and global leadership in information and advisory services. Based
in Stamford, Conn., the company has more than 900 employees and operates in 21 countries.
www.isg-one.com

EMEA Outsourcing Index Third Quarter 2015 Market Data and Insights

Recommandé

Recommandé

Contenu connexe

Tendances

Tendances (19)

En vedette

En vedette (17)

Similaire à EMEA Outsourcing Index Third Quarter 2015 Market Data and Insights

Similaire à EMEA Outsourcing Index Third Quarter 2015 Market Data and Insights (19)

Plus de Werner Feld

Plus de Werner Feld (13)

Dernier

Dernier (16)

EMEA Outsourcing Index Third Quarter 2015 Market Data and Insights