Your SlideShare is downloading. ×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

What is happening to Consulting & SI? Is it going away? - Insights from TBR's IT Services Vendor Benchmark

367

Published on

Published in: Business, Technology
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
367
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
30
Comments
0
Likes
1
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide
  • Blend of functional, industry and technological expertise: Differentiate through functional and industry expertise and integrate management consulting, technology and outsourcing to bring tangible value to clients.
    Sells value and shares risk with client: Accenture helps clients improve business and IT structures, grow revenue and cut costs
    As brand vendor reputation has a decreasing influence on clients’ buying decisions, Accenture strives to align its success with its clients’ by offering value-based agreements. The firm drives differentiation through its industry and functional specialization, its skilled people, global reach and integration of outsourcing services and technology capabilities for end-to-end solutions. This allows the firm to capture demand for business and sales transformation, CRM, risk management, talent acquisition and technology consulting offerings to help clients improve their business models and operations, migrate to new IT infrastructures and reduce costs.
    Grow market share in mature markets and emerging markets: Grow market share in mature markets (e.g., U.S., Europe) and accelerate growth in emerging markets (e.g., LATAM, India, China, Mexico, Middle East, Africa). In 2H12 Accenture reintroduced management consulting in the Philippines to target the local market, particularly in the communication, resources and financial services industries. Accenture will leverage its consulting expertise to capture opportunities from Philippines-based firms looking to increase global capabilities and MNCs moving into the region.
    Global delivery capabilities and use of low-cost model: Global Capability Network : The Global Capability Network (formerly called the Global Talent & Innovation Network) with 2,000+ people in 12 locations across Argentina, China, India, Poland and Spain strengthens the firm’s consulting force, allowing it to cater to clients’ regional demands and deliver quicker and to scale.
  • Alti—acquisition in July 2013; located in France, expands SAP system integration capabilities; TCS gains 1,200 employees in France, Belgium and Switzerland improving onshore SI staff
    Transformation Solutions benefit from investments in IP and tools, such as the analytics-led Enterprise Transformation Framework ; Cloud-related transformation solutions include: cloud readiness, migration services to a cloud environment (IaaS, PaaS, SaaS)
    http://www.tcs.com/offerings/it_infrastructure/transformation-solutions/Pages/default.aspx
  • Consulting growth continues to stem from inorganic revenues and an extended footprint in Europe due to the integration of Lodestone. In 2Q13 Infosys assigned former CFO and board member V. Balakrishnan to chairman of Infosys’ consulting subsidiary Lodestone, and we expect Balakrishnan’s experience and proven track record with Infosys’ BPO and Finacle segments to complete the Lodestone integration and further boost consulting sales.
  • Transcript

    • 1. What is happening to Consulting & SI? Is it going away? — Insights from TBR’s IT Services Vendor Benchmark Technology Business Research Quarterly Webinar Series Oct. 15, 2013
    • 2. PSBQ 2Q13 Research Highlights and Outlook: Webinar Presenters Ramunas Svarcas Senior Analyst and Engagement Manager, Professional Services Practice ramunas.svarcas@tbri.com @rjsTBR Elitsa Bakalova Analyst, Professional Services Practice elitsa.bakalova@tbri.com @ElitsaBakalova Stephanie Artigliere Analyst, Professional Services Practice stephanie.artigliere@tbri.com @StephanieA715 2 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 3. PSBQ 2Q13 Research Highlights and Outlook: Webinar Overview TBR’s IT Services Vendor Benchmark delivers unique insight and value through in-depth analysis in a concise, consumable format Clients are gaining advantages and better understanding revenue opportunities through our reports and their personal relationships with TBR. • The Professional Services Practice publishes quarterly and semiannual reports, continually covering 33 vendors. • Of those vendors, 30 are included in our IT Services Vendor Benchmark. o o Financial modeling and TBR insights help customers build a better understanding of vendor business models. o TBR reports and webinars are designed to be responsive to client timelines, to be clear and concise, and to provide insights across multiple layers of an organization. o 3 TBR reports are unique due to their deep, holistic analysis of leading vendor businesses. TBR’s strategic assessment provides an impartial reality check on how vendors are performing in regard to their strategic objectives and the overall market. TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 4. PSBQ 2Q13 Research Highlights and Outlook: Key Trends C&SI vendors are preparing for growth as near-term cost takeout is gradually giving way to emerging technology implementations Professional Services Vendor Trends for 2Q13 Performance: While consulting and systems integration (C&SI) budgets are still tight, vendors invest in offerings and resources to drive growth. SOURCE: HTTP://WWW.PPTBACKGROUNDS.NET Portfolio: By 2014 clients will expect services around emerging technologies to yield results, driving an expansion of consulting & SI revenues. SOURCE: HTTP://BLOG.ENTREPENUERARTS.COM SOURCE: HTTP://WWW.PSDGRAPHICS.COM 4 People: Consulting is shifting from fly-in-withadvice to invest, build and share risks and rewards with clients at a local and regional level. TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 5. PSBQ 2Q13 Research Highlights and Outlook: Key Trends C&SI vendors are preparing for growth as near-term cost takeout is gradually giving way to emerging technology implementations Professional Services Vendor Trends for 2Q13 Performance: While consulting and systems integration (C&SI) budgets are still tight, vendors invest in offerings and resources to drive growth. Portfolio: By 2014 clients will expect services around emerging technologies to yield results, driving an expansion of consulting & SI revenues. People: Consulting is shifting from fly-in-withadvice to invest, build and share risks and rewards with clients at a local and regional level. 5 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 6. PSBQ 2Q13 Research Highlights and Outlook: Performance Demand for transformational and industry-specific C&SI projects remains soft, hindering overall 2Q13 C&SI revenue growth Average trailing 12-month C&SI revenue growth trailed all other service lines in 2Q12 and in 2Q13 as vendors continued to face hesitant consulting spending due to restricted IT budgets and pricing pressures across the developed countries in the Americas, EMEA and APAC. Note: Dots indicate YTY growth and arrows indicate directional change relative to the year-ago quarter (green accelerating or red decelerating growth). 6 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 7. PSBQ 2Q13 Research Highlights and Outlook: Performance C&SI revenue will resurge in 2H13 as IT services spending on emerging technology implementations gradually accumulates revenue streams Professional Services Vendor Trends for 2Q13 — Performance C&SI revenue decelerated year-to-year in 2Q13 as vendors invested in BPO, and AO technology-enabled and vertical-specific solutions to enhance services value, help clients reduce costs and support operational efficiency. Inflection Point 7 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 8. PSBQ 2Q13 Research Highlights and Outlook: Performance C&SI leaders, such as India-centric firms, find success with delivery models that combine industry-specific onshore and low-cost resources India-centric vendors recruit and acquire onshore, industry-oriented consulting resources to boost their value proposition among North American and European clients, and win end-to-end transformational projects. These firms find success with a combination of domain experts and low-cost outsourcing resources. Growth driven by acquisition 8 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 9. PSBQ 2Q13 Research Highlights and Outlook: Performance Accenture will strengthen its technology and industry expertise, and build presence in underpenetrated areas to maintain its leading C&SI position 9 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 10. PSBQ 2Q13 Research Highlights and Outlook: Key Trends C&SI vendors are preparing for growth as near-term cost takeout is gradually giving way to emerging technology implementations Professional Services Vendor Trends for 2Q13 Performance: While consulting and systems integration (C&SI) budgets are still tight, vendors invest in offerings and resources to drive growth. Portfolio: By 2014 clients will expect services around emerging technologies to yield results, driving an expansion of consulting & SI revenues. People: Consulting is shifting from fly-in-withadvice to invest, build and share risks and rewards with clients at a local and regional level. 10 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 11. PSBQ 2Q13 Research Highlights and Outlook: Portfolio Vendors ramp up emerging technologies in concert with clients’ maturing needs and expectations to drive business value from IT projects Professional Services Vendor Trends for 2Q13 — Portfolio To offset decelerating C&SI growth, vendors aimed to secure larger tranformational engagements by investing in IP-based solutions and industry-specific consulting services tailored to the adoption of emerging technologies such as cloud, analytics and mobility. While vendors scale up emerging technologies offerings, clients will appreciate and grow accustomed to what cloud, analytics and mobility can deliver. By 2014, clients will expect those services to yield results, driving an expansion of consulting & SI revenues. 11 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 12. PSBQ 2Q13 Research Highlights and Outlook: Portfolio After the inflection point, small projects give way to bundled, high-revenue transformation and technology implementation engagements Technology adoption offers a long-term C&SI growth opportunity for vendors investing in services capabilities around cloud, analytics and mobility. High Revenue Growth/Portfolio Investment Activity Vendors investing ahead of demand for emerging technology C&SI services benefit as clients aggressively deploy discretionary budgets on large-scale projects that support IT transformation. Inflection Point C&SI Revenue Growth Vendor Investment Activity Low SOURCE: TBR 12 Current Market Scenario Future Market Scenario TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 13. PSBQ 2Q13 Research Highlights and Outlook: Portfolio The trend in IP development and decoupling of headcount growth from C&SI revenue growth are materializing for only a few vendors Vendors that succeed use a combination of an IP portfolio and internal initiatives that focus on project efficiencies and employee empowerment. • To generate revenue from less laborintensive activities, HCLT leverages IP-based tools and accelerators while Cognizant uses IP-based tools and frameworks as well as industryspecific, “ready-to-deploy” performance management solutions. • Xerox increases C&SI revenue per employee through workforce restructuring in the U.S. coupled with productivity tools and merging consulting with document outsourcing services. SOURCE: TBR GLOBAL DELIVERY MARKET LANDSCAPE (GDML) FALL 2013 2Q12 TTM Revenue per Employee 2Q12 TTM Revenue per Employee Positive Growth 2Q13 TTM Revenue per Employee 13 2Q12 TTM Revenue per Employee 2Q13 TTM Revenue per Employee 2Q13 TTM Revenue per Employee Negative Growth TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 14. PSBQ 2Q13 Research Highlights and Outlook: Portfolio TCS will leverage investments in cloud consulting, acquisitions and onshore consultants to sustain double-digit C&SI revenue growth TCS C&SI Investment Strategy and Recent Initiatives • Offers C&SI for vertical-specific platforms, such as the Digital Publishing Platform for retailers • Invests in IP assets, particularly aimed at specific verticals such as banking, financial services and insurance as well as technology adoption such as cloud 14 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 15. PSBQ 2Q13 Research Highlights and Outlook: Key Trends C&SI vendors are preparing for growth as near-term cost takeout is gradually giving way to emerging technology implementations Professional Services Vendor Trends for 2Q13 Performance: While consulting and systems integration (C&SI) budgets are still tight, vendors invest in offerings and resources to drive growth. Portfolio: By 2014 clients will expect services around emerging technologies to yield results, driving an expansion of consulting & SI revenues. People: Consulting is shifting from fly-in-withadvice to invest, build and share risks and rewards with clients at a local and regional level. 15 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 16. PSBQ 2Q13 Research Highlights and Outlook: People Vendors optimize their C&SI resources to successfully compete for C&SI deals in the long term Professional Services Vendor Trends for 2Q13 — People C&SI headcount continues to outpace revenue growth, which will help vendors generate growth and profit potential from the C&SI inflection point. •Software and hardware vendors are building global C&SI practices and opening local offices in emerging regions to wrap services around technology offerings. •Vendors are investing in technology-specific and industry-specific Centers of Excellence and Innovation Centers to support global and local market expansion. •India-centric vendors continue to build their onshore presence through acquisitions and hiring. 16 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 17. PSBQ 2Q13 Research Highlights and Outlook: People C&SI headcount growth decelerated; however, it continues to outpace revenue growth as vendors anticipate rebounding demand Vendors increase consulting force in low-cost locations to cater to clients’ regional demands, deliver quicker and to scale, and increase pricing flexibility. Inflection SOURCE: TBR GLOBAL DELIVERY MARKET LANDSCAPE (GDML) FALL 2013 Note: C&SI headcount and revenue for 14 IT services vendors including Accenture, Atos, Capgemini, Cognizant, Dell Services, CSC, HCLT, HP Services, IBM GS, Infosys, TCS, T-Systems, Wipro ITS and Xerox 17 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 18. PSBQ 2Q13 Research Highlights and Outlook: People Onshore recruits in developed economies will help India-centric vendors compete for C&SI-led strategic IT transformation deals Profit Results and Correlating Changes in Headcount Metrics The two SI groups rationalize onshore headcounts and increase low-cost staff to improve their cost structures and pricing flexibility. India-centric vendors add onshore staff, particularly in C&SI, to overcome visa challenges in the U.S. and Europe, have proximity to clients and compete for consulting-led deals. SOURCE: TBR GLOBAL DELIVERY MARKET LANDSCAPE (GDML) FALL 2013 18 Key: 2Q12 vs. 2Q13  Improvement  Deterioration  change No TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 19. PSBQ 2Q13 Research Highlights and Outlook: People India-centric vendors continue to add onshore C&SI resources to expand their smaller revenue and headcount bases compared to MNCs India-centric vendors invest in acquisitions, hiring and delivery centers to expand their local market C&SI bases and client proximity in the U.S. and Europe. INDIA-CENTRIC VENDOR ONSHORE C&SI HEADCOUNT AND GROWTH YTY Headcount Growth Onshore C&SI Headcount VERSUS INDUSTRY PEERS SOURCE: TBR GLOBAL DELIVERY MARKET LANDSCAPE (GDML) FALL 2013 Note: C&SI headcount and revenue for 14 IT services vendors including Accenture, Atos, Capgemini, Cognizant, Dell Services, CSC, HCLT, HP Services, IBM GS, Infosys, TCS, T-Systems, Wipro ITS and Xerox 19 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 20. PSBQ 2Q13 Research Highlights and Outlook: People While onshore C&SI headcount increased for all 5 India-centric vendors, Infosys and Wipro ITS accelerated onshore C&SI recruitment in 2Q13 M&As support Infosys’ investments in local consulting resources and delivery centers in the U.S. and Europe, allowing the firm to pursue deals with Fortune 500 and Global 2000 clients. INDIA-CENTRIC VENDOR ONSHORE C&SI HEADCOUNT AND GROWTH YTY Headcount Growth Onshore C&SI Headcount Infosys acquired Switzerlandbased management consulting firm Lodestone. SOURCE: TBR GLOBAL DELIVERY MARKET LANDSCAPE (GDML) SPRING 2013 Note: Dots indicate YTY growth and arrows indicate directional change relative to the year-ago quarter (green accelerating or red decelerating TBR 20 growth). Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 21. PSBQ 2Q13 Research Highlights and Outlook: Key Trends To succeed, vendors will leverage C&SI capabilities to convert technologies and analytics outputs into client business value C&SI OPPORTUNITY SOURCE: http://blog.thecompanywarehouse.co.uk Building Capabilities SOURCE: http://greenhabbing101.com Increasing Value • 2012 was about building capabilities — through acquisitions, alliances and innovations — in technology trends such as cloud, digital, mobility and analytics. • In 2013 vendors continue acquiring and partnering for technology-centric services to bring scale to their offerings. Clients are shifting from learning about emerging technologies to understanding exactly how those technologies disrupt business models, creating opportunities for C&SI vendors. 21 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 22. PSBQ 2Q13 Research Highlights and Outlook: 3Q13 Key Topics Leading vendors will build IP to drive cost reduction and improve employee utilization while investing in specific verticals and technologies PSP Research • Select Vendor Reports: o Accenture o Atos o Capgemini o Cisco Services o Cognizant o CSC o Dell Services o Fujitsu o HP Services o IBM Global Services o Infosys o TCS o T-Systems o Wipro ITS o Xerox • Benchmarks: Management 22 Consulting, Healthcare IT Services, Public Sector, Global Delivery Market Landscape, Managed Private & Professional Services Cloud Current Topics Vertical Growth Strategy: Retail IP Development Digital 3Q13 Report Key Themes  What emerging technologies are offered in the retail space? What is the prevailing motivation behind customer purchase of professional services (cost takeout or transformation)?  How is the firm acquiring IP (R&D, M&A, alliances/JV, Customer Engagement)? Is the IP being developed targeting specific niche areas, industry verticals or specific LOBs?  How are digital offerings distinguished from mobility and social consulting services? Are analytics, including big data, paired with digital or offered separately? Which industries are firms targeting for digital offerings? TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 23. PSBQ 2Q13 Research Highlights and 2013 Outlook Questions? 23 TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 24. Ramunas Svarcas Senior Analyst and Engagement Manager, Professional Services Practice ramunas.svarcas@tbri.com @rjsTBR Elitsa Bakalova Analyst, Professional Services Practice elitsa.bakalova@tbri.com @ElitsaBakalova Stephanie Artigliere Analyst, Professional Services Practice stephanie.artigliere@tbri.com @StephanieA715 For further information, please contact: Lindy Hanson Director, Professional Services Practice lindy.hanson@tbri.com 24 Twitter: @TBRinc SlideShare: www.slideshare.net/TBR_Market_Insight YouTube: www.youtube.com/user/TBRIChannel James McIlroy Vice President, Sales mcilroy@tbri.com TBR Quarterly Webinar Series | 10.15.13 | www.tbri.com | ©2013 Technology Business Research Inc.
    • 25. About TBR Contact Us Technology Business Research, Inc. is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators. 1.603.929.1166 info@tbri.com www.tbri.com 11 Merrill Drive Hampton, NH 03842 USA Serving a global clientele, TBR provides timely and actionable market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis. TBR has been empowering corporate decision makers since 1996. To learn how our analysts can address your unique business needs, please visit our website or contact us today. This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact Technology Business Research, Inc. for permission to reproduce.

    ×