1Q19 EMEA ISG Index™

ISG Confidential. © 2019 Information Services Group, Inc. All Rights Reserved.
Proprietary and Confidential. No part of this document may be reproduced in any form or by
any electronic or mechanical means, including information storage and retrieval devices or
systems, without prior written permission from Information Services Group, Inc.
Global Sourcing and
As-a-Service Market Insights
Hosted by:
John King, Bank of America Merrill Lynch
April 12, 2019
FIRST QUARTER 2019

ISG Confidential. © 2019 Information Services Group, Inc. All Rights Reserved. 2
EMEA 1Q19
Eleanor Winn
Director – Digital Sourcing
United Kingdom
Barry Matthews
Managing Partner,
North Europe
Covering the state of the
combined Traditional
Sourcing and As-a-Service
industry for the global
commercial market.
Welcome
to the 66th
Quarterly
ISG Index
Steve Hall
Partner and
President ISG
Wayne Butterfield
Director, EMEA Practice Lead
for AI & Cognitive Automation

EMEA 1Q19
*Contracts with ACV ≥ €4M from the ISG Contracts Knowledgebase™
At a GlanceGlobal Combined Market ACV rose 12% Y/Y
fueled by robust IaaS market.
Traditional Sourcing ACV up 2% Y/Y and
up 8% on a Trailing-12-Month basis,
on record contracting activity.
Americas up slightly Y/Y; As-a-Service
surpassed Traditional Sourcing for the first time.
EMEA advanced Y/Y with 20%+ growth in
both Sourcing and As-a-Service segments;
Traditional Sourcing boosted by larger deal sizes
and strength in DACH, France and the Nordics.
Asia Pacific up significantly Y/Y, fueled by strong
growth in Traditional Sourcing and As-a-Service;
strong ITO results and healthy activity in ANZ and
North Asia drove the gains in Traditional Sourcing.
Scorecard 1Q19 1Q Y/Y TTM TTM
ACV (€B)* Change ACV (€B)* Change
Global Commercial Combined Market 10.8 12% 40.9 20%
By Type Traditional Sourcing 5.6 2% 22 8%
As-a-Service 5.2 26% 18.9 37%
By Region Americas Combined 5.3 1% 20.1 11%
EMEA Combined 3.9 23% 14.4 29%
Asia-Pacific Combined 1.6 33% 6.2 31%

EMEA 1Q19
5.4 4.6 4.8 4.6 5.7 4.8 4.9 5.1 5.4 5.8 5.1 5.5 5.6
2.3
2.4 2.7 3.0
3.0
2.9 3.2 3.6
4.2 4.5
4.6 4.6 5.2
7.7
7.0 7.5 7.6
8.6
7.7 8.1
8.7
9.6
10.2
9.7 10.2
10.8
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
Traditional Sourcing As-a-Service
19.8 20.2 22.0
11.0 13.8
18.9
30.8
34.1
40.9
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
14.1
5.6
4.2
6.9
15.5
4.7 4.7
9.1
17.3
4.7 5.2
13.7
ITO BPO SaaS IaaS
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
Global Commercial Sector Contracting Trends
1Q19 Combined Market ACV up 12% Y/Y with the As-a-Service sector seeing continued strong gains;
Traditional Sourcing up 2% Y/Y as ITO results remain strong; however, the number of contract awards softens.
Combined Market Quarterly ACV (€B)
Global Commercial Sector ACV (€B) Global Commercial Sector ACV by Type (€B)

EMEA 1Q19
9.7 7.5 9.4
3.0
3.8
5.2
12.6
11.4
14.6
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
6.8
3.0
1.0
1.8
6.0
1.5 1.3
2.6
7.8
1.6 1.4
3.8
ITO BPO SaaS IaaS
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
EMEA Commercial Sector Contracting Trends
1Q19 Combined Market ACV up 23% Y/Y as IaaS growth offsets decline in SaaS; Traditional Sourcing ACV
gains 24% Y/Y on uptick in larger transactions; DACH leads the way with gains also in France, Southern Europe and the Nordics.
EMEA Commercial Sector ACV (€B)
EMEA Commercial Sector Quarterly ACV (€B)
EMEA Commercial Sector ACV by Type (€B)
2.6
1.9
2.5 2.2
3.0
2.2
1.3
1.9 2.1
2.6 2.2 2.0
2.6
0.6
0.6
0.7 0.8
0.8
0.8
0.9
1.0 1.1
1.3
1.3
1.3
1.4
3.2
2.6
3.2 3.0
3.8
3.0
2.2
3.0
3.2
3.8
3.5
3.3
3.9
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19

EMEA 1Q19
EMEA Commercial Sector Industry Award Trends
As-a-Service ACV grows across all sectors. Financial Services and Manufacturing sectors post strong growth in both
Traditional Sourcing and As-a-Service as focus on customer experience and speed to market takes hold.
EMEA Commercial Industries ACV (€B)
Financial
Services
Healthcare
& Pharma
Business
Services Energy
Telecom
& MediaRetail
Consumer
Packaged Goods
Travel, Transport
& Leisure
Manufacturing
0.5 0.5 0.6
0.2 0.3 0.3
1.4 1.4 1.4
2.6 2.1
2.9
0.3 0.2 0.4
1.5
1.1
1.7
0.3 0.3 0.3
1.6
0.6 0.7
1.0 0.9 1.0
0.6
0.9
1.2
0.2 0.2 0.3
0.2 0.2 0.2
0.5
0.6
0.8
0.3 0.3
0.4
0.4
0.6
0.8
0.2 0.3 0.4
0.3
0.4
0.5
0.3 0.4 0.5
1.1
1.4
1.8
0.4 0.5 0.6
1.6 1.6 1.6
3.1 2.7
3.7
0.6 0.5
0.8
1.9
1.7
2.5
0.5 0.6 0.7
1.9
1.0
1.2 1.3 1.3
1.5

EMEA 1Q19
EMEA Sub-Regions - Traditional Sourcing Only
Increased contract sizes and a boost in the number of contracts boosts the DACH market and pushes up the regional results..
Steady growth across most EMEA markets lends support. UK growth remains tepid as Brexit uncertainty runs on.
EMEA Commercial Industries ACV (€B)
3.63
2.72
0.83
0.33
0.58
1.11
0.38
0.14
2.38
1.88
0.94
0.23
0.70
0.38
0.73
0.24
2.54
3.06
1.18
0.42
0.76 0.72
0.38 0.36
UK and Ireland DACH Nordics Africa and Middle East France Southern Europe Benelux Eastern Europe
2Q16-1Q17 2Q17-1Q18 2Q18-1Q19

EMEA 1Q19
Sourcing Standouts
EMEA
Our Contracts Knowledgebase™ is used to determine
placements based on the annual value of commercial
contracts awarded in the past 12 months.the
ISG15 Providers in alphabetical order; no rankings implied. Revenues
sourced from D&B and individual company financial fillings.
* New to leaderboard since 1Q19.
The Big 15
Co. Revenues > €8 B
Traditional Sourcing
Market
Accenture
Atos
BT
Capgemini
CBRE
Cognizant
DXC Technology
IBM
Infosys
ISS A/S
TCS
T-Systems *
As-a-Service Market
Amazon Web Services
Google
Microsoft
The Building 15
Co. Revenues €2.4 - €8 B
Market
Amdocs
Arvato *
Bechtle
CGI
HCL Technologies
Indra Sistemas
Kuehne & Nagel *
Orange Business Services
SopraSteria
Tech Mahindra
Teleperformance *
Wipro
As-a-Service Market
Adobe Systems
Equinix
United Internet
The Breakthrough 15
Co. Revenues €.8 - €2.4B
Market
Alten SA
Altran
Axians
Cancom
Diebold Nixdorf
EVRY ASA
GFI Informatique
Giesecke & Devrient
JLL
Mitie
Sutherland *
Tieto
Unisys
Webhelp
As-a-Service Market
Autodesk
The Booming 15
Co. Revenues < €.8 B
Market
Allgeier SE
Bouvet ASA
Comarch
Comparex AG
Datagroup
Devoteam *
Mindtree
NNIT A/S
QIWI
Quest Global *
Reply SpA
SVA System Vertrieb Alexander
Virtusa
As-a-Service Market
Interxion
OVH

EMEA 1Q19
8.6 10.7 10.4
6.4
7.4 9.7
15.0
18.1
20.1
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
Americas Commercial Sector Contracting Trends
1Q19 Combined Market ACV up 1% Y/Y boosted by 25% growth in As-a-Service;
Traditional Sourcing ACV remains above €2.5B but declines 16% Y/Y on weakness across both ITO and BPO.
Americas Commercial Sector Quarterly ACV (€B)
Americas Commercial Sector ACV by Type (€B)Americas Commercial Sector ACV (€B)
2.4 2.2 1.9 2.1 2.3 2.0
3.0 2.7 3.0
2.5 2.5 2.9 2.6
1.4 1.4 1.6 1.7 1.7
1.5
1.8 1.9
2.2
2.2 2.3
2.4 2.7
3.8 3.7 3.5 3.8 4.0
3.5
4.7 4.6
5.2
4.7 4.8
5.3 5.3
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
6.2
2.3 2.8 3.7
8.0
2.7 3.0 4.4
7.7
2.7 3.3
6.4
ITO BPO SaaS IaaS
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19

EMEA 1Q19
1.20
0.38 0.42
1.341.52
0.52 0.48
2.181.78
0.34
0.59
3.45
ITO BPO SaaS IaaS
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19
Asia Pacific Commercial Sector Contracting Trends
1Q19 Combined Market Y/Y growth remains above 30% as the region produces the second-best quarter ever;
most of the geographic markets generate positive trend data led by strong gains in ANZ and North Asia.
Asia Pacific Commercial Sector Quarterly ACV (€B)
Asia Pacific Commercial Sector ACV by Type (€B)Asia Pacific Commercial Sector ACV (€B)
0.39 0.49 0.42 0.38 0.29
0.55 0.62 0.49 0.38
0.67
0.38
0.58 0.50
0.38
0.37 0.42 0.48
0.49
0.54
0.61
0.69 0.82
0.98
0.97
1.00 1.090.77
0.86 0.84 0.86
0.78
1.10
1.23 1.18 1.19
1.66
1.34
1.58 1.59
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
1.58 2.04 2.13
1.76
2.66
4.04
3.34
4.70
6.17
2Q16 - 1Q17 2Q17 - 1Q18 2Q18 - 1Q19

EMEA 1Q2019
Utilities Sector
1Q19 ISG Index™ Inside Track from
Eleanor Winn
Director – Digital Sourcing
United Kingdom

EMEA 1Q19
Business Trends Affecting the Utilities Sector
Customer service is LAGGING
relative to other industries
and needs to be improved
NEW TECHNOLOGIES
and DATA PROLIFERATION
can be used for competitive
advantage
Rapidly changing customer demands FORCE
an operating model change, especially
with grid management
Consumer
Generated Power
Electric Vehicles
and Charging Stations
Real-Time Customer
Communication
Smart Devices
and Data Analytics

EMEA 1Q19
Technology Enablers
Automated Metering Infrastructure –AMI
ERP and CIS IntegrationCybersecurity
1
2
3
Government mandates
implementation of
cybersecurity and
security parameters ERP
CIS Value comes from
connecting data with
a near-real-time
platform
Smart meter use improves
electricity supply & demand
and profitability

EMEA 1Q19
Proliferation of Data – Changing the Operating Model
With these changes, we can expect to see an uptick in:
To help utility companies navigate new rules and regulations.
Multi-Sourcing – Organizational Change Management (OCM) – Governance
Systems
Integration
SAP and CIS
Cloud
Migration
Legacy Systems
Digitization
Safety
Automation
Regulatory
Requirements
Providers can help with
planning & regulatory
accounting

EMEA 1Q2019
The Future of SaaS
1Q19 ISG Index™ Inside Track from
Wayne Butterfield
Director, EMEA Practice Lead
for AI & Cognitive Automation

EMEA 1Q19
SaaS − Strong Movement to the Cloud
Predictable
Financial Outflows
Reduces the Burden
of Support Teams
Innovation
Producing Machine
SaaS

EMEA 1Q19
SaaS – A Long-Term Growth Story
Cross-selling across app categoriesLand and Expand
Enterprises
Shifting focus from solely IT to
include marketing, product
engineering and development, et al.
SMBs
Market largely
underpenetrated
2018
$125B+
Year
1
Year
2
Year
3
Year
4
Year
5
SaaS Market
ISG projects this to be a quarter-
trillion-dollar market in 5 years

EMEA 1Q19
Service Providers – Strategy Alignment in the New Paradigm
Changing Nature
of Services Revenue
Software
Spend
Today2012
Services Revenue
Service Providers With
Platform Specific Talents
SaaS
Platform App Development
on Top of SaaS Products
Micro-services Architecture
to Modernize Application Estates
Stitching Together SaaS Platforms Predictive Analytics That
Deliver Critical Business Outcomes
For Service Providers to Evolve and Continue to Grow

EMEA 1Q19
1Q 2019 ISG Index – Global Summary and Outlook
● Global macro slowdown is a possibility, with technology markets supporting a mixed narrative.
● IaaS sector still growing at a fast pace as the major providers continue to invest in building out their
infrastructures while pushing deeper into the enterprise.
● SaaS market potential remains robust with revenue headwinds existing in the near term.
● Traditional Sourcing grew markedly in both EMEA and Asia Pacific against softer Y/Y comparisons;
metrics tempered by flat results in the U.K., a moderate decline in the U.S. and slowing number of
contract awards globally during the first quarter.
● Our forecast of 25% growth on the digital side of the business holds as new transformative operating
models and the transitional to digital are only in the early stages.
● With ongoing macro-economic challenges, we expect the services market to advance at a pace of 3.2%.
Summary
Outlook

EMEA 1Q19
isg-one.com
Would You Like to Learn More?
Steven Hall
President, ISG EMEA and
Partner, ISG Digital Services
+44 7384 259676
steven.hall@isg-one.com
Stanton Jones
Director, Principal Analyst
ISG Research
+1 281 795 2636
stanton.jones@isg-one.com
Esteban Herrera
Partner, Global Leader
ISG Research
+1 972 730 1749
esteban.herrera@isg-
one.com
Will Thoretz
Global Leader, Corporate
Communications and Brand
+1 203 517 3119
will.thoretz@isg-one.com
Denise Colgan
EMEA & AP Media Contact
+44 1737 371523
denise.colgan@isg-one.com
Paul Reynolds
Partner,
Chief Research Officer
ISG Momentum
+1 508 488 6361
paul.reynolds@isg-one.com
Thank
You

EMEA 1Q19
Appendix: Sourcing Standouts by Region
FIRST QUARTER 2019

EMEA 1Q19
Sourcing Standouts
Global
* New to leaderboard since 1Q19.
Regional leaderboards are on slides 24-26.
The Big 15
Co. Revenues > €8 B
Market
Accenture
Atos
Capgemini
CBRE
Cognizant
DXC Technology
IBM
Infosys
TCS
T-Systems *
As-a-Service Market
Alibaba
Amazon Web Services
Google
Microsoft
Salesforce
The Building 15
Co. Revenues €2.4 - €8 B
Market
Amdocs
Bechtle
Conduent *
FIS Global *
First Data
Genpact *
HCL Technologies
OptumInsight
Tech Mahindra
Total System Services
Wipro
As-a-Service Market
Adobe Systems
Equinix
Iron Mountain
United Internet
The Breakthrough 15
Co. Revenues €.8 - €2.4 B
Market
Alten *
Altran
Diebold Nixdorf
EVRY ASA
Giesecke & Devrient *
JLL
LTI
Mphasis *
Sutherland Global Services
TTEC
Unisys
As-a-Service Market
Autodesk
Digital Realty *
ServiceNow
Workday
The Booming 15
Co. Revenues < €.8 B
Market
Bouvet ASA
ChinaSoft
EXL
Mindtree
NNIT A/S
Posco ICT *
Virtusa
WNS *
Zensar *
As-a-Service Market
Atlassian *
Blackbaud *
CyrusOne
Interxion
OVH
ProofPoint

EMEA 1Q19
Sourcing Standouts
AMERICAS
* New to leaderboard in 1Q19.
The Big 15
Co. Revenues > $10 B
Market
Accenture
Atos *
BNY Mellon
Capgemini
CBRE
Cognizant
DXC Technology
IBM
Infosys
NTT DATA
TCS
As-a-Service Market
Amazon Web Services
Google
Microsoft
Salesforce
The Building 15
Co. Revenues $3 - $10 B
Market
Alorica
Cerner Corporation
Concentrix *
Conduent
First Data
FIS Global
Genpact *
HCL Technologies
OptumInsight
Paychex *
Tech Mahindra
Wipro
As-a-Service Market
Adobe Systems
Equinix
Iron Mountain
The Breakthrough 15
Market
Diebold Nixdorf
Epic Systems *
Groupe Acticall
InnerWorkings
LTI
Mphasis
Pitney Bowes
Sutherland *
TTEC
Unisys
WEX
As-a-Service Market
Autodesk
Digital Realty
ServiceNow
Workday
The Booming 15
Co. Revenues < $1 B
Market
EXL
FirstSource Solutions
Hexaware
Mindtree
StarTek
Virtusa
WNS *
Zensar *
As-a-Service Market
Blackbaud
CyrusOne
IPSoft
Internap *
Paycom *
Proofpoint
RingCentral

EMEA 1Q19
contracts awarded in the past 12 months.
Sourcing Standouts
Asia Pacificthe
* New to leaderboard in 1Q19.
The Big 15
Co. Revenues > $10 B
Market
Accenture
Cognizant
DXC Technology
Fujitsu *
Hitachi
IBM
Infosys
NTT Data
TCS
As-a-Service Market
Alibaba
Amazon Web Services
China Telecom
Google
Microsoft
Tencent
The Building 15
Market
Amdocs
First Data Corporation
Genpact *
HCL Technologies
IT Holdings (TIS)
ITOCHU Techno-Solutions
JLL
NCR *
Nomura Research Institute
Samsung SDS
Tech Mahindra
Telstra
Wipro
As-a-Service Market
Adobe Systems
Equinix
The Breakthrough 15
Market
Diebold Nixdorf
Digital China
JLL
Konica Minolta
Mphasis *
Nihon Unisys
NS Solutions *
Sumitomo SCSK
Sutherland Global Services
transcosmos
Unisys
As-a-Service Market
Autodesk
PTC
Sage
ServiceNow
The Booming 15
Co. Revenues < $1 B
Market
Aspen Technology
Beyondsoft
Chinasoft
Datacom
Fuji Soft
HGS
Neusoft
Posco ICT *
Relia
Shinsegae I&C
Sichuan Troy Information Tech
Taiji Computer *
As-a-Service Market
Atlassian
Kingdee
Xero

EMEA 1Q19
Global Commercial Sector Industry Award Trends
BFSI sets the pace among the industries with a clear technology imperative and propensity to spend; most industry verticals continue
to observe yearly growth with the exception of Telcom & Media, which is undergoing significant consolidation and change.
Global Commercial Industries ACV (€B)
Financial
Services
Healthcare
& Pharma
Business
Services Energy
Telecom
& MediaRetail
Consumer
Packaged Goods
Travel, Transport
& Leisure
Manufacturing
2.0 1.7 1.6 1.0 1.0 1.3 2.2 2.2 2.2
5.0 5.5 6.1
1.3 1.7 2.3 3.0 3.5 3.9
0.8 0.7 1.0
2.9 2.2 1.8 1.8 1.8 1.7
3.0 3.8
5.4
0.6 0.8 1.1
0.5 0.6 0.8
1.5
1.9
2.6
1.2 1.2
1.5
1.4
1.8
2.5
0.9 1.2 1.5
1.0
1.3 1.8 1.0 1.3 1.6
5.0 5.5
7.0
1.6 1.8
2.4 2.6 2.7 3.0
6.6
7.4
8.7
2.5 2.9
3.8 4.3
5.4
6.4
1.7 1.9
2.6
3.9 3.4 3.5
2.8 3.1 3.3

1Q19 EMEA ISG Index™

More Related Content

What's hot

Similar to 1Q19 EMEA ISG Index™

More from Information Services Group (ISG)

Recently uploaded

1Q19 EMEA ISG Index™