The document discusses trends in the European IT outsourcing market. It finds that Europe is the largest services outsourcing market worldwide, worth $170 billion in 2012. The UK and France saw significant growth in outsourcing contracts in 2014, while Germany stagnated. Drivers of outsourcing include reducing costs and simplifying IT operations, while potential inhibitors include loss of control and cultural issues. Emerging trends include hybrid sourcing models and a movement toward smaller, shorter-term outsourcing deals.
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European IT Services Outsourcing Trends Report
1. EUROPEAN IT SERVICES OUTSOURCING
SNAPSHOT & TRENDS
CIONET International
26 August 2014 - Prepared by Frederic De Meyer
@CIONET
CIONET
CIONET
CIONET TV
2. AGENDA
§ The outsourcing market landscape in Europe
§ Drivers & inhibitors of the European outsourcing market
§ New trends in outsourcing
§ Major conclusions
3. AGENDA
§ The outsourcing market landscape in Europe
§ Drivers & inhibitors of the European outsourcing market
§ New trends in outsourcing
§ Major conclusions
4. EUROPE IS THE LARGEST SERVICES OUTSOURCING
MARKET WORLDWIDE
Source: Frost & Sullivan 2012
Overall European Services Outsourcing market is worth 170$bn in 2012,
European market share for overall outsourcing accounted for 43%
5. DIFFERENCES IN ADOPTION RATE ACCROSS
EUROPEAN COUNTRIES
Source: E&Y 2013
In average, 14% of services are being outsourced in Europe
7. DIFFERENCES IN ADOPTION RATE ACCROSS
EUROPEAN INDUSTRIES
Automotive and Telecommunications are the biggest spenders in outsourced
IT services in Europe
Source: E&Y 2013
8. GLOBAL IT SERVICES & OUTSOURCING MARKET
Global market size = 952$Bn
IT Services = 648$Bn
BPO = 304$Bn
Source: HfS Research 2013
10. PUBLIC CLOUD BECOMES MAINSTREAM IN EUROPE
Public Cloud is growing +30% CAGR
Source: IDC 2012
11. AGENDA
§ The outsourcing market landscape in Europe
§ Drivers & inhibitors of the European outsourcing market
§ New trends in outsourcing
§ Major conclusions
12. WHAT’S KEEPING CIO’S AWAKE AT NIGHT…
EU2013
EU2012
EU2011
EU2010
IT & Business Alignment
Business Agility
Business Cost reduction
IT Cost reduction
…..
Business re-engineering (7)
Business Cost reduction
Business re-engineering
Business Agility
IT & Business Alignment
…..
IT Cost reduction (8)
Source: CIONET IT Trends survey 2013
Maximizing business relevance is the single most important concern for
European CIO’s nowadays. And outsourcing plays a vital role in this…
13. ECONOMIES OF SCALE AND IT SIMPLIFICATION ARE
MAJOR DRIVERS FOR IT OUTSOURCING
Financial drivers
Business drivers
Human Resources drivers
Technology drivers
Source: CIONET IT Sourcing survey 2013
15. AGENDA
§ The outsourcing market landscape in Europe
§ Drivers & inhibitors of the European outsourcing market
§ New trends in (IT) outsourcing
§ Major conclusions
16. SOME MEGADEALS STILL OCCUR
10 year multi-billion deal with
IBM
5 year 2,2 billion deal with IBM &
Tata, TCS & Infosys
5 year deal with Atos
multi year 240 million deal with
IBM, Cap Gemini, HCL
Source: CIONET Research
Outsourcing is increasingly used as a strategic differentiator by European
companies, indicating a maturing outsourcing market
18. AGENDA
§ The outsourcing market landscape in Europe
§ Drivers & inhibitors of the European outsourcing market
§ New trends in (IT) outsourcing
§ Major conclusions