3Q17 EMEA ISG Index

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Proprietary and Confidential. No part of this document may be reproduced in any form or by any electronic
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Global Sourcing and
As-a-Service Market Insights
Hosted by:
John King, Bank of America, Merrill Lynch
17 October 2017
THIRD QUARTER 2017

ISG Confidential. © 2017 Information Services Group, Inc. All Rights Reserved 2
EMEA 3Q17
Covering the state of the
combined Traditional
Sourcing and As-a-Service
industry for the EMEA
commercial market.
Welcome
to the 60th
Quarterly
EMEA
ISG Index
Barry Matthews
Partner, UK
Wayne Butterfield
Director – Cognitive & AI Innovation and
Automation
Friedrich Loeer
Partner, DACH

EMEA 3Q17
‘‘
*Contracts with ACV ≥ €4M from the ISG Contracts Knowledgebase™
At a Glance
Demand for cloud-based solutions spurs record As-
a-Service ACV of €3.7 billion, up 43%
Combined global market up 16%, including slight
increase in Traditional Sourcing
Americas ACV surges 45%, with both As-a-Service
and Traditional Sourcing up over 40%
Despite record As-a-Service sourcing, EMEA
stumbles on drop-off in Traditional Sourcing
Asia Pacific up 43%, with Traditional Sourcing
slightly outpacing As-a-Service growth
Scorecard 3Q17 3Q Y/Y 3Q Q/Q YTD YTD
ACV (€B)* Change Change ACV (€B)* Change
Global Commercial Combined Market € 8.5 16% 9% $ 25.0 14%
By Type Traditional Sourcing € 4.8 2% 2% € 14.7 1%
As-a-Service € 3.7 43% 18% $ 10.3 41%
By Region Americas Commercial € 5.0 45% 31% $ 13.0 20%
EMEA Commercial € 2.3 -23% -22% $ 9.0 3%
AP Commercial € 1.2 43% 16% € 3.0 25%

EMEA 3Q17
Global Commercial Sector Contracting Trends
3Q17 Combined Market ACV up 16% Y/Y on record high As-a-Service ACV;
YTD, Traditional Sourcing remains static but with record high contracting activity (based on number of awards).
Global Commercial Sector Quarterly ACV (€B)
Global Commercial Sector YTD ACV (€B) Global Commercial Sector YTD ACV by Type (€B)
Global Commercial Sector Quarterly ACV (€B)
Global Commercial Sector YTD ACV (€B) Global Commercial Sector YTD ACV by Type (€B)
€ 4.8€ 4.7€ 5.2
€ 4.5€ 4.7€ 4.6
€ 5.3
€ 6.0
€ 4.7€ 5.2
€ 4.2
€ 5.5
€ 4.7
€ 5.6€ 5.5
€ 3.7€ 3.2
€ 3.4
€ 3.2€ 2.6€ 2.3
€ 2.4
€ 2.3
€ 2.2€ 1.8
€ 1.7
€ 1.5
€ 1.5
€ 1.7€ 1.4
€ 8.5
€ 7.9
€ 8.6
€ 7.7€ 7.3€ 6.9
€ 7.7
€ 8.3
€ 6.9€ 7.0
€ 5.9
€ 7.0
€ 6.2
€ 7.3€ 6.9
3Q172Q1Q4Q3Q162Q1Q4Q3Q152Q1Q4Q3Q142Q1Q14
Traditional Sourcing As-a-Service
€ 14.7€ 14.6€ 14.1€ 15.8
€ 10.3€ 7.3€ 5.7€ 4.7
€ 7.7€ 8.3€ 7.0
€ 25.0
€ 29.6€ 28.1€ 27.5
2017201620152014
YTD Traditional Sourcing YTD As-a-Service Combined 4Q
€ 11.6
€ 3.1
€ 2.6
€ 7.7
€ 0
€ 5
€ 10
€ 15
ITO BPO SaaS IaaS
Range of Prior 3 YTDs Avg of Prior 3 YTDs
YTD 3Q16 YTD 3Q17

EMEA 3Q17
EMEA Commercial Sector Contracting Trends
Combined Market in EMEA declines 23% Y/Y; record ACV levels in As-a-Service (+48%) can’t offset decline in Traditional Sourcing (-43%);
YTD, Combined Market increases 3% with strength in IaaS and a flurry of Traditional Sourcing activity from early in 2017.
EMEA Commercial Sector Quarterly ACV (€B)
EMEA Commercial Sector YTD ACV (€B) EMEA Commercial Sector YTD ACV by Type (€B)
€ 1.3
€ 2.2
€ 2.8
€ 2.1
€ 2.4
€ 1.9
€ 2.6
€ 3.2
€ 2.3€ 2.4
€ 1.9
€ 2.7
€ 2.2
€ 2.7€ 2.7
€ 1.0
€ 0.8
€ 0.9
€ 0.9€ 0.7
€ 0.6
€ 0.5
€ 0.6
€ 0.6€ 0.5
€ 0.5
€ 0.4
€ 0.4
€ 0.4€ 0.4 € 2.3
€ 3.0
€ 3.6
€ 3.0€ 3.1
€ 2.5
€ 3.1
€ 3.8
€ 2.9€ 2.9
€ 2.4
€ 3.1
€ 2.6
€ 3.1€ 3.1
€ 6.3€ 6.9€ 6.6€ 7.6
€ 2.7€ 1.8€ 1.6€ 1.3
€ 3.0€ 3.8€ 3.1
€ 9.0
€ 11.7€ 12.0€ 12.0
2017201620152014
€ 4.9
€ 1.4
€ 0.6
€ 2.1
€0
€2
€4
€6
€8
ITO BPO SaaS IaaS
Range of 3 YTDs Avg of Prior 3 YTDs
YTD 3Q16 YTD 3Q17

EMEA 3Q17
EMEA Commercial Sector Industry Award Trends
YTD, mixed results in many industry sectors with Financial Services leading and Manufacturing and Telecom lagging; Financial Services and mid-
sized verticals CPG and Business Services lead the way with double-digit gains in both Traditional Sourcing and As-a-Service.
Manufacturing and Retail are the exceptions.
Traditional
Sourcing
YTD ACV (€B)
EMEA
Commercial
Industries
As-a-Service
YTD ACV (€B)
EMEA
Commercial
Industries
€ 2.1
€ 0.9
€ 1.1
€ 0.7 € 0.7
€ 0.4
€ 0.2 € 0.1 € 0.2
€ 0.0
€ 0.5
€ 1.0
€ 1.5
€ 2.0
€ 2.5
Financial Services Manufacturing Energy Telecom & Media Travel, Transport &
Leisure
Business Services Healthcare &
Pharma
Retail Consumer
Packaged Goods
Range of 3 YTDs Avg of Prior 3 YTDs YTD 3Q16 YTD 3Q17
€ 0.5
€ 0.4
€ 0.1
€ 0.3 € 0.3
€ 0.5
€ 0.2 € 0.2 € 0.2
€ 0.0
€ 0.1
€ 0.2
€ 0.3
€ 0.4
€ 0.5
€ 0.6
Financial Services Manufacturing Energy Telecom & Media Travel, Transport &
Leisure
Business Services Healthcare &
Pharma
Retail Consumer
Packaged Goods

EMEA 3Q17
EMEA Sub-Regions - Traditional Sourcing Only
Despite the weak third quarter, UK and France saw strong YTD results. DACH fell 25% year on year but posted its third highest YTD ACV in a
decade. Lacklustre performance in the Nordics was driven by an absence of large deals.
EMEA Commercial Sector Sub Regions – YTD ACV (€B) – Traditional Sourcing Only
€ 2.5
€ 0.6
€ 0.1
€ 0.6
€ 1.7
€ 0.0
€ 0.5
€ 1.0
€ 1.5
€ 2.0
€ 2.5
€ 3.0
€ 3.5
€ 4.0
U.K. & Ireland Nordics Africa & Middle East France DACH

EMEA 3Q17
Our Contracts Knowledgebase™
is used to determine placements
based on the annual value of
commercial contracts
awarded in the past 12 months.
Traditional Sourcing Market
Adare Group
Coor Service Management
Eulen
Firstsource Solutions
Hexaware
Ibykus
KMD
Luxoft
MAYKOR
NNIT A/S
Virtusa
WNS
As-a-Service Market
Interxion
LogMeIn
OVH
Atento
Capita
Carillion
Diebold Nixdorf
EVRY
HCL
Interserve
Orange Business Services
Sopra Steria
Tech Mahindra
Tieto
Wipro
As-a-Service Market
Adobe Systems
Equinix
United Internet
Accenture
Atos
BT
Capgemini
Cognizant
DXC Technology
IBM
Infosys
TCS
T-Systems
As-a-Service Market
Amazon Web Services
Google
Microsoft
Oracle
SAP
The Building 15 The Breakthrough 15The Big 15
Co. Revenues > $10 B
Sourcing Standouts
EMEA Co. Revenues $1 -10 B Co. Revenues < $1 B
Providers in alphabetical order; no rankings implied. Revenues sourced from Hoovers and individual company financial fillings.
the
ISG15

EMEA 3Q17
Americas Commercial Sector Contracting Trends
Commercial Market ACV is up 45% Y/Y as both Traditional Sourcing and As-a-Service segments exceed 40+% growth;
YTD, Combined Market up 20% on record highs in As-a-Service (37%) and Traditional Sourcing (9% Y/Y).
Americas Commercial Sector Quarterly ACV (€B)
Americas Commercial Sector YTD ACV (€B) Americas Commercial Sector YTD ACV by Type (€B)
€ 2.8
€ 2.0€ 2.1€ 1.9€ 1.9€ 2.2€ 2.3€ 2.3€ 2.0€ 2.4
€ 1.7€ 2.2€ 2.2€ 2.1€ 1.9
€ 2.2
€ 1.9€ 2.0€ 1.9€ 1.5€ 1.4€ 1.5€ 1.4€ 1.3€ 1.0
€ 1.0€ 1.0€ 0.9€ 1.1€ 0.9
€ 5.0
€ 3.9€ 4.1€ 3.8€ 3.4€ 3.6€ 3.8€ 3.7
€ 3.3€ 3.4
€ 2.7€ 3.1€ 3.1€ 3.2€ 2.8
€ 6.9€ 6.4€ 6.1€ 6.2
€ 6.1
€ 4.4€ 3.3€ 2.9
€ 3.8
€ 3.7€ 3.1
€ 13.0
€ 14.6
€ 13.1€ 12.2
2017201620152014
€ 5.6
€ 1.3
€ 1.7
€ 4.4
€ 0
€ 1
€ 2
€ 3
€ 4
€ 5
€ 6
ITO BPO SaaS IaaS
YTD 3Q16 YTD 3Q17

EMEA 3Q17
Americas Commercial Sector Industry Award Trends
Combined Market shows growth across all industries with the exception of Telecom;
largest verticals, Financial Services and Manufacturing, lead the way in Y/Y growth in both Traditional Sourcing and As-a-Service.
Traditional
Sourcing
YTD ACV (€B)
Americas
Commercial
Industries
As-a-Service
YTD ACV (€B)
Americas
Commercial
Industries
€ 1.8
€ 1.6
€ 0.7
€ 0.8
€ 0.3 € 0.4 € 0.3
€ 0.4
€ 0.5
€ 0.0
€ 0.5
€ 1.0
€ 1.5
€ 2.0
Financial Services Manufacturing Healthcare &
Pharma
Business Services Telecom & Media Energy Retail Consumer Packaged
Goods
Travel, Transport &
Leisure
€ 1.1
€ 0.8
€ 0.5
€ 1.3
€ 0.7
€ 0.3
€ 0.5
€ 0.4
€ 0.5
€ 0.0
€ 0.5
€ 1.0
€ 1.5
Financial Services Manufacturing Healthcare &
Pharma
Business Services Telecom & Media Energy Retail Consumer Packaged
Goods
Travel, Transport &
Leisure

EMEA 3Q17
Asia Pacific Commercial Sector Contracting Trends
Combined Market ACV rises 43% Y/Y on record high As-a-Service awards and best Traditional Sourcing ACV since 2014;
YTD, Asia Pacific ACV is up 25% as both IaaS and ITO ACV increase 30+%.
AP Commercial Sector Quarterly ACV (€B)
AP Commercial Sector YTD ACV (€B) AP Commercial Sector YTD ACV by Type (€B)
€ 1.1
€ 0.3
€ 0.3
€ 1.3
€ 0.0
€ 0.5
€ 1.0
€ 1.5
€ 2.0
ITO BPO SaaS IaaS
YTD 3Q16 YTD 3Q17
€ 1.4€ 1.3€ 1.4
€ 2.0
€ 1.6
€ 1.1€ 0.8
€ 0.6
€ 0.8
€ .07
€ 0.8
€ 3.0€ 3.2
€ 2.9
€ 3.4
2017201620152014
€ 0.6
€ 0.5
€ 0.3€ 0.4€ 0.4€ 0.5
€ 0.4€ 0.4€ 0.5€ 0.5€ 0.5
€ 0.6
€ 0.4
€ 0.8€ 0.8
€ 0.6
€ 0.5
€ 0.5€ 0.5€ 0.4€ 0.4
€ 0.3€ 0.3€ 0.3€ 0.2€ 0.2
€ 0.2
€ 0.2
€ 0.2€ 0.2
€ 1.2
€ 1.0
€ 0.8€ 0.8€ 0.8€ 0.9
€ 0.7€ 0.7€ 0.8€ 0.7€ 0.7
€ 0.8
€ 0.6
€ 1.0€ 1.0

EMEA 3Q17
Asia Pacific Commercial Sector Industry Award Trends
Most industry verticals grow Y/Y in Combined Market ACV;
Financial Services and mid-sized markets such as Energy and CPG generate both strong Y/Y As-a-Service and Traditional Sourcing activity.
Traditional
Sourcing
YTD ACV (€B)
Asia Pacific
Commercial
Industries
As-a-Service
YTD ACV (€B)
Asia Pacific
Commercial
Industries
€ 0.26 € 0.29
€ 0.40
€ 0.14
€ 0.19
€ 0.08 € 0.05
€ - € 0.03€ 0.0
€ 0.1
€ 0.2
€ 0.3
€ 0.4
€ 0.5
€ 0.6
€ 0.7
Telecom & Media Manufacturing Financial Services Travel, Transport &
Leisure
Energy Business Services Consumer Packaged
Goods
Healthcare &
Pharma
Retail
€ 0.2
€ 0.2 € 0.2
€ 0.1
€ 0.1
€ 0.4
€ 0.1 € 0.1 € 0.1
€ 0.0
€ 0.1
€ 0.2
€ 0.3
€ 0.4
€ 0.5
€ 0.6
Telecom & Media Manufacturing Financial Services Travel, Transport &
Leisure
Energy Business Services Consumer Packaged
Goods
Healthcare &
Pharma
Retail

EMEA 3Q17
The Rapidly Transforming Digital Contact Center
Wayne Butterfield
Director – Cognitive & AI Innovation and Automation
3Q17 Index Inside Track from

EMEA 3Q17
Digital Drivers of Call Center Transformations
A Labor Intensive
Cost Center
A Brand and Customer
Connection Point
Demographic
Change
Millennials have significant buying
power, and they expect a seamless,
omni-channel experience.
Switching Costs are
Very Low
A personalized brand experience – right
products, right services, right time, right
place – creates Customer stickiness.
Dramatic Intelligent Tech
Improvements
Dramatic improvement in human-like
“intelligent assistance“ technologies
that can understand conversation.
321
Over the next 2 Years expect 2X Increase in adoption of virtual agents and chat bots.
Rapid
Transformation
Drivers
Change

EMEA 3Q17
Contact Center Market Outlook
A $60B Contact Center Market is expected to grow 2-3% percent then flatten in 2 to 3 years.
Sentiment
+50% of IT and business
leaders feel +50% of offshore
work will be repatriated due to
intelligent automation
ISG Research 2017
▪ Focus on improving call center customer experience drives
repatriation of projects.
▪ Labor shortage of higher skilled agents, especially in U.S.
▪ Accelerated shift towards “intelligent assistance”
operating models
▪ Technology buying increases while services buying drops
Higher skilled
workforce
What’s Driving the Flattening Market?
Outlook
Leverage new
technology
Successful
Service Providers
Increased customer retention
and brand awareness
Need More? Look the ISG Provider Lens™ Report on Contact Center Outsourcing, and a forthcoming Buyer’s Guide to Intelligent Assistance for insights.

EMEA 3Q17
3Q 2017 ISG Index - Global Summary and Outlook
● Substantial Y/Y growth for the quarter in both the Americas and Asia Pacific, but that was offset by a
decline in EMEA.
● As-a-Service segment rebounded from slowing 2Q with record-setting ACV; YTD, As-a-Service rose 40%
with strength in IaaS segment, notably the public cloud, and high single-digit growth in SaaS.
● Several Industries generated both Traditional Sourcing and As-a-Service YTD growth, including Financial
Services and smaller sectors such as Energy and CPG.
● As-a-Service segment: forecast 20+% growth through next year, driven by further acceptance of public
cloud and stepped-up activity occurring in both EMEA and Asia Pacific.
● Traditional Sourcing segment: forecast an increase of 2.5% next year
Summary
Outlook

EMEA 3Q17
isg-one.com
Learn More
Barry Matthews
Partner
+44 7881 954 710
barry.matthews@isg-one.com
Tara Benham
Cohn & Wolfe for ISG
+44 (0) 20 7331 5395
tara.benham@cohnwolfe.com
Denise Colgan
EMEA and AP Media Contact
+44 1737 371523
denise.colgan@isg-one.com
Esteban Herrera
Partner, Global Leader
ISG Research
+1 203 820 8987
bill.mcnee@isg-one.com
Paul Reynolds
Partner, Chief Research Officer
ISG Momentum
+1 508 625 2194
paul.reynolds@isg-one.com

GLOBAL 4Q16
EMEA 3Q17
Appendix: Score Card for TCV
THIRD QUARTER 2017

EMEA 3Q17
3Q 2017 TCV Scorecard
The ISG 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.
*Contracts with TCV ≥ €20M from the ISG Contracts Knowledgebase™
Scorecard
3Q17 3Q Y/Y YTD Y/Y
TCV (€B)* Change TCV (€B)* Change
Global Commercial Combined
Market
€ 25.9 27% € 67.9 16%
By Type Traditional Sourcing € 20.3 25% € 52.3 4%
As-a-Service € 5.6 39% € 15.6 27%
ITO € 15.7 33% € 39.8 12%
BPO € 4.6 2% € 12.5 -15%
IaaS € 2.8 47% € 7.7 58%
SaaS € 2.8 32% € 7.9 7%
By
Region
Americas Commercial € 15.7 66% € 33.0 33%
EMEA Commercial € 6.7 -23% € 26.9 2%
Asia Pacific Commercial € 3.5 56% € 8.0 10%

ISG Confidential. © 2017 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.
isg-one.com
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firm. A trusted business partner to more than 700 clients, including 75 of the top 100 enterprises in the
world, ISG is committed to helping corporations, public sector organizations, and service and technology
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countries—a global team known for its innovative thinking, market influence, deep industry and
technology expertise, and world-class research and analytical capabilities based on the industry’s most
comprehensive marketplace data.

3Q17 EMEA ISG Index

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