Sid Pai, Partner and Managing Director TPI

0 Europe: The Next Frontier Siddharth (Sid) Pai, Partner and Managing Director, TPI 11th February 2009 Copyright © 2009, Technology Partners International, Inc. All Rights Reserved. No part of this document may be reproduced in any form or by any electronic or mechanical means, including informationInternational, retrieval devices or systems, without prior written permission from Technolo gy Partners International, Inc. Copyright © 2009, Technology Partners storage and Inc. All Rights Reserved

1 Current Market Trends Regional differences most distinct in use of ITO and BPO Annual Comparison by TCV (€B) BPO Contracts Awarded with TCV > € ITO Contracts Awarded with TCV > € 20M 20M 2006 2007 2008 2006 2007 2008 31.4 24.6 23.8 9.9 9.8 9.2 18.0 8.1 7.8 7.8 15.7 13.1 8.8 3.9 7.1 5.9 1.7 0.8 Americas EMEA Asia Pacific Americas EMEA Asia Pacific Since 2006, Americas’ share of global TCV decreased from about 51% to 32%; EMEA’s increased 38% to 55%. 2008 ITO Contracts Awarded with TCV > 2008 BPO Contracts Awarded with TCV > € € 20M TCV (€ B) 20M TCV (€B) Asia Asia Pacific Americas Pacific 26% 12% 19% Americas 43% EMEA EMEA 38% 62% Copyright © 2009, Technology Partners International, Inc. All Rights Reserved

2 Service Providers Signing Ten or More Contracts > €20M India-based providers continued to among the most active service providers Industrywide EMEA Contracts With TCV > € 20M: 2008 Service Providers with > 5 Commercial EMEA Contract Awards with TCV > € 2007 vs 2008 Comparison – Service Provider Diversity 20M 2007 2008 80 70 19 15 10 6 # of SP signing # of SP signing # of SP signing ten one or more five or more or more contracts contracts contracts Copyright © 2009, Technology Partners International, Inc. All Rights Reserved

3 What do customers increasingly expect… Network of Partners (not providers) who can collectively offer a unique combination of expertise at a competitive cost structure to help them stay ahead of the curve in their Core business. Industry Industry Skin in the Game – Skin in the Game – Knowledge & Knowledge & Risk/Reward Balance Risk/Reward Balance Domain Expertise Domain Expertise Corporate Governance Corporate Governance -- Trust Trust Ability to support Ability to support Compelling cost Compelling cost business growth or business growth or structures structures new markets entry new markets entry Copyright © 2009, Technology Partners International, Inc. All Rights Reserved

4 What Service Providers ought to focus on… Providers will need to focus on critical areas to enhance their competitive positions 1 Multi language skills, technology skills, scale and local Multi language skills, technology skills, scale and local Location Equation Location Equation presence – readiness to compete in key European markets presence – readiness to compete in key European markets 2 Speed is of the Speed is of the Actively consider consolidation and partnership. Competitor Actively consider consolidation and partnership. Competitor essence essence provider with potential for a strategic combination provider with potential for a strategic combination 3 Build differentiated strategies and compelling industry Build differentiated strategies and compelling industry solutions for under penetrated markets – platform based Under penetrated solutions for under penetrated markets – platform based Under penetrated offerings, bundled services, transformation solutions offerings, bundled services, transformation solutions 4 Willingness to aggressively try risk/reward arrangements Willingness to aggressively try risk/reward arrangements with clients as well as strive to deliver business benefits Risk/ Reward with clients as well as strive to deliver business benefits Risk/ Reward through outcome (instead of effort) based orientation through outcome (instead of effort) based orientation Governance is key to a successful sourcing transaction. 5 Governance is key to a successful sourcing transaction. Providers should display strong sourcing governance Providers should display strong sourcing governance Governance Governance practices to build trust amongst comparatively less practices to build trust amongst comparatively less outsourced/ offshored markets outsourced/ offshored markets Copyright © 2009, Technology Partners International, Inc. All Rights Reserved

5 What do Indian Service Providers need to do? Indian providers need to identify specific markets in Europe and align investments Recession has forced a drop in valuation of many European outsourcing Opportunistic Opportunistic companies making them prime targets for acquisition. This serves as a means Acquisitions Acquisitions to gain entry, attain expertise and scale. Relationships are essential in winning local contracts. Indian IT providers should Local Business Local Business aggressively partner with local outsourcing companies in Europe to achieve a Development Development significant share in local business Move up the business value chain by providing strategic outsource solutions and Innovation and Innovation and robust ways of dealing with a global end-user base. Value Value Establish and strengthen the risk management process, capabilities and culture Resilience Resilience Display the mind set and behavior for effective governance Develop/ enhance the ability to service diverse language speaking customers Cultural Affinity Cultural Affinity Train the workforce to adapt to diverse cultural environment “The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow.” – Rupert Murdoch Copyright © 2009, Technology Partners International, Inc. All Rights Reserved

Sid Pai, Partner and Managing Director TPI

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