everest group peak matrix for po service providers...jan 27, 2016 · europe was the key growth...

Copyright © 2015 Everest Global, Inc.

This document has been licensed for exclusive use and distribution by Accenture

Everest Group PEAK Matrix for PO Service Providers

Focus on Accenture

September 2015

EGR-2015-1-E-1589

2Copyright © 2015, Everest Global, Inc.

EGR-2015-1-E-1358

Introduction and scope

Everest Group recently released its report titled “Procurement Outsourcing (PO) – Service Provider Landscape

with PEAK Matrix™ Assessment 2015”. This report analyzes the changing dynamics of the PO landscape and

assesses service providers across several key dimensions.

As a part of this report, Everest Group updated its classification of 18+ service providers on the Everest Group

Performance | Experience | Ability | Knowledge (PEAK) Matrix for PO into Leaders, Major Contenders, and

Aspirants. The PEAK Matrix is a framework that provides an objective, data-driven, and comparative

assessment of PO service providers based on their absolute market success and delivery capability. Everest

Group also identified three service providers as the “2015 PO Market Star Performers” based on the strongest

Year-on-Year (YoY) forward movement demonstrated on the PEAK Matrix.

Based on the analysis, Accenture emerged both as a Leader and a Star Performer. This document focuses on

Accenture’s PO experience and capabilities. It includes:

Accenture’s position on the PO PEAK Matrix

Accenture’s YoY movement on the PO PEAK Matrix

Detailed PO profile of Accenture

Buyers can use the PEAK Matrix to identify and evaluate different service providers. It helps them understand

the service providers’ relative strengths and gaps. However, it is also important to note that while the PEAK

Matrix is a useful starting point, the results from the assessment may not be directly prescriptive for each

buyer. Buyers will have to consider their unique situation and requirements, and match them against service

provider capability for an ideal fit.

https://research.everestgrp.com/Product/EGR-2015-1-R-1549/Procurement-Outsourcing-PO-PO-Service-Provider-Landscape-with-


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Procurement pyramid (non-core spend)

Everest Group distinguishes between the Source-to-

Contract (S2C) and Procure-to-Pay (P2P) processes

S2P

strategy

4. Requisition to PO

6. Accounts payable and T&E

5. Invoice processing

7. Procurement systems

1. Spend data management

2. Strategic sourcing

3. Vendor management

8. Performance management

Everest Group’s analyses include multi-process PO contracts with a minimum of three procurement processes, over

US$1 million in ACV, and a minimum contract term of three years. Typically, the managed spend is greater than

US$50 million

Everest Group’s analyses include all multi-process PO contracts signed as of 2014

Strategy

Judgment-intensive

Transaction-intensive


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Everest Group PEAK Matrix – 2015 PO market standing

Performance | Experience | Ability | Knowledge

Leaders

Major Contenders

Aspirants

Star Performers

Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix for PO

Major Contenders

Aspirants

Leaders

Ma

rke

t su

ccess

(Re

ve

nu

e, clie

nts

, a

nd

gro

wth

)

PO delivery capability1

(Scale, scope, technology & innovation, delivery footprint, and buyer satisfaction)

25

thp

erc

en

tile

High

Low

25th percentile

75th percentile

Low High

75

thp

erc

en

tile

Accenture

IBM

Infosys

GEP

XchangingGenpact

TCS

Capgemini

Proxima

Aegis

Tech Mahindra

HCMWorks

HCL

WiproHP

WNS Aquanima

Optimum Procurement

1 Service providers scored using Everest Group’s proprietary scoring methodology

Source: Everest Group (2015)


EGR-2015-1-E-1358

Accenture is a PO Star Performer based on the strong

forward and upward movement over time on the

Everest Group PEAK Matrix

Market success in 2014

Accenture registered the highest number of new contracts wins in 2014. In total, it signed 25 new multi-

process contracts worth over ~US$400 million in TCV

It also had the highest ACV growth in absolute terms among all service providers

Europe was the key growth region for Accenture, followed by North America

Accenture witnessed high growth in the CPG & retail and travel & tourism industries, while manufacturing

also registered significant traction

Accenture extended its partnership with SAP to deliver cloud-based solutions for procurement and F&A

It made several in-house investments to improve S2P technologies and tools, and started development of

over 14 applications for Accenture Insights

As a part of its digital initiative, Accenture invested in several technologies including RPA, mobility, and

cloud. It opened RPA centers in India, Philippines, China, Mauritius, and Italy

Capability enhancements in 2014


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Accenture (page 1 of 5)

PO service capabilities

Key PO-related developments

Year 2014: Expanded its partnership with SAP/Ariba to deliver cloud-

based solutions for procurement and F&A BPO services

Year 2013: Acquired Procurian, a leading provider of procurement

business process solutions, for US$375 million

Year 2013: Procurian launched "Procurian Insights" – a proprietary

dashboard solution built on the QlikView BI platform

Key PO leaders

Mike Salvino, Group Chief Executive – BPO

Kristin Ruehle, Procurement BPO Offering Lead

PO service suite

S2P services across all indirect spend categories including

transformational change management

Sourcing & category management-related services:

Category governance & category planning, strategic

sourcing, e-auctions, spot-buys, contracting, supplier

performance management, compliance management, and

spend, savings, and compliance analytics

Transactional procurement services: Requisition

processing, invoice processing, payment processing,

Time & Expense (T&E) processing, payment accuracy &

controls, procurement enablement, technology

management, vendor master data management, and P2P

and compliance analytics

Spend managed for external clients

More than US$95 billion

Category expertise

IT/telecom, contingent labor, marketing, facilities / real estate,

MRO, HR services, travel services, professional services,

capital projects, logistical services, and energy & utilities

Source-to-Contract (S2C) Procure-to-Pay (P2P)

Scale of operations

Number of PO FTEs1 over time

2012 2013 2014

>500 FTEs 100-500 FTEs <100 FTEs

FTE mix by process scope

3,300+

1,500+

2,900+

1 Does not include accounts payable and SCM FTEs



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PO client portfolio

Time of signing Client Contract details

Q4 2014 Education

publisher

Five-year program to centralize and manage S2C process for this global industry leader across all categories of

indirect spend, assisting efforts to fuel expansion in strategic growth markets

Q4 2014 Multinational food

& beverage

company

Selected to provide an end-to-end, S2P solution across a range of indirect spend for five years. Complex delivery

requirements include addressing the needs of stakeholders across seven operating companies and providing

procurement operations and tail-spend services to more than 130 locations

Q4 2014 High-tech

manufacturer

Awarded a five-year S2P program designed to capture significant savings across a broad range of indirect spend in

North America, Europe, and Asia Pacific for a large and rapidly-growing global player in a highly competitive

industry

Recently-announced multi-process PO engagements

PO revenue industry mix (2014) PO revenue buyer size mix (2014)PO revenue geography mix (2014)

65-70%

25-30%

50-55%35-40%

5-10% 15-20%

10-15%

10-15%30-35%

5-10%

BFSI

Large

buyers

Mid-

marketNorth

America

Asia Pacific

Energy &

utilities (E&U)

Hi-tech and

telecom

Middle East

and Africa (MEA)

(0-5%)

Small- and Medium-sized

Businesses (SMBs) (0-5%)

Europe

Latin America

(0-5%)Manufacturing

Others

CPG and

retail

Major PO clients

Microsoft, Diebold, Glencore Xstrata, a diversified chemical company, a global banking and financial services company, an aerospace manufacturer, a

leading global financial services group, an automotive parts company, a large APAC bank, and a multinational pharmaceutical company

5-10%

10-15%Healthcare

and pharma

Note: Based on contractual information as of 2014



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PO delivery locations

San Antonio

San Jose

Sao Paulo

Buenos Aires

LondonPrague

Noida

HyderabadBangalore Chennai

Bratislava

Delhi

Dalian

Shanghai

Shenzhen

BucharestKing of Prussia

Pittsburgh

Johannesburg

Belo Horizonte



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PO technology solutions

Sourcing solution P2P solution Process-agnostic solution

Solution

description

Strategic sourcing and spend

analytics

Tactical buying / RFX

management

Continuous analytical

capability to feed sourcing and

process benefits realization

Order execution and management,

contract management, supplier &

catalog management, and operations

Vendor portal to support self-service

Buyer portal to drive compliance and

purchasing processes

Accenture BPO Navigator is a

dashboard-based tool that provides

a near real-time view across all

areas of service delivery

Insight derived from high-level

rolled up data down to subprocess-

specific

Process scope Opportunity analysis, spend

analysis, strategic sourcing,

quoting / low-dollar sourcing,

savings baseline &

calculation, and supplier

performance management

Requisition approval and purchase order

management

Procurement support, invoice and

payment processing, working capital

management, analytics, and control and

compliance

Cross process, providing a

dashboard view across

procurement including sourcing,

spend savings, PO processing,

reconciliations, invoice processing,

workflow, and query management

Technology

leveraged

Radix™, BravoSolutions, and

Accenture Insights

Ariba and CombineNet

Emptoris and IQ Navigator

Category-specific sourcing:

Telecom and transportation

Radix™ PTP, Ariba, SAP, Coupa, MS

Dynamics AX, and IQN

Leverage ERPs including SAP,

Peoplesoft, Oracle, and JD Edwards

Accenture Buyer Portal

Accenture Supplier Portal

Accenture P2P analytics, Accenture

transaction compliance, and analytics tool

Platform developed by Accenture,

designed for cloud and on-premise

deployment

Connected to transactional

platforms through an integration hub

Delivery model

and pricing

Hosted, single-client, and

multi-client

Up front implementation fees,

pay-per-transaction, license

fees, bundled-in FTE pricing,

and performance-based

pricing (gainshare)

Hosted, single-client, and multi-client

Up front implementation fees, pay-per-

transaction, license fees, bundled-in

FTE pricing, and performance-based

pricing (gainshare)

Hosted, single-client, and multi-

client

Up front implementation fees, pay-

per-transaction, license fees,

bundled-in FTE pricing, and

performance-based pricing

(gainshare)


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Everest Group assessment

2012 2013 2014

Delivery capability assessment1

Assessment

dimension Rating Remarks

Scale Global major with more than US$30 billion in revenue

Scope Strong capabilities in end-to-end S2P services, serves clients across

diverse geographies and industries, exposure to wide buyer segment,

and high category expertise

Technology

and

innovation

Robust technological capabilities across sourcing (RadixTM) and P2P

(Radix™ PTP); made several in-house investments to bolster RPA,

mobility, cloud, social media, and analytics capabilities

Delivery

footprint

Global delivery footprint with centers across all geographies and

leveraging an adequate shoring mix

Buyer

satisfaction

Clients have cited concerns over communication gaps, especially

between on-site teams and buying center associates, and over too

much churn created after the acquisition of Procurian

Market success assessment

Global multi-process PO market share over time1

Percentage share by ACV

Number of

contracts

ACV TCV

25-30% 25-30%20-25%

Global multi-process PO market share1

Percentage

Managed

Spend (MS)

25-30%

20-25%

Key strengths

One of the two service providers with global end-to-end S2P

capabilities that enable it to service a wide range of client

requirements

Strong expertise across industries and categories, enabling it to

efficiently execute transformational agenda for clients

Capability to execute multi-tower BPO and ITO deals

Accenture has strong analytical capabilities and proprietary

technologies, significantly bolstered through the acquisition of

Procurian

25-30% 25-30%

Areas of improvement

Ease of accessibility and communication with key executives. Some clients

have noted that due to Accenture’s large and matrixed structure, they find it

hard to navigate through the organization

Accenture needs to quickly address any lingering issues/concerns faced by

its clients since integration with Procurian

It needs to proactively engage with second- or third-generation clients to

create additional value for the engagement, or risk losing them to

competition

5-10%

YoY growth

Best-in-class Very high High Medium high

Medium Medium low Low Not matured

Note: Based on contractual and operational information as of 2014



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Appendix


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Traditionally, PO has been limited primarily to a

function-focused definition

Procurement pyramid (non-core spend)

S2P

strategy

4. Requisition to PO

6. Accounts payable and travel & expense (T&E)

5. Invoice processing

7. Procurement systems

1. Spend data management

2. Strategic sourcing

3. Vendor management

8. Performance management

Strategy (implemented

in-house)

Mission strategy / corporate

strategy

Business strategy

Geographic strategy

Technology strategy

Strategy

Judgment-intensive

Transaction-intensive

Strategic sourcing

Sourcing strategy

Vendor selection

Contracting

Sourcing implementation

Category management

Spend data management

Baseline analysis

Data “cube” construct

Opportunities’ definition

Requisition to PO

Approval workflow

Material requisition

Purchase order

Expediting/

troubleshooting

1

24

Vendor management

Vendor relationship

management

Contract administration

Service level/standards

monitoring

3

Procurement systems

E-auctions

Catalog management

Solution hosting

7

Accounts payable and T&E

Master data maintenance

Process payment request

T&E claims processing

EDI / P-card1 administration

Month-end closing

Vendor inquiries

Reporting

6

Invoice processing

Material/invoice receipt

Invoice payment

5

Performance management

Financial performance

Compliance management

Policies and procedures

Performance and results

reporting

8

1 Refer to Appendix


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Direct

spend

Indirect

spend

Core

spend

Non-core

direct

spend

Non-core

spend

Goods and services that are key ingredients to

manufacture/deliver the final product/service

They are proprietary or specific to the

organization

For example: Iron ore for a steel manufacturer

and rubber for a tyre manufacturer

Source-to-Contract

(S2C)

Procure-to-Pay

(P2P)

Source-to-Pay (S2P) cycle

Goods and services that are commonly required

to manufacture/deliver the final product/service

They are commodities in that industry

For example: Lubricants, packaging, and

Maintenance, Repair, & Overhaul (MRO)

Non-production goods and services that are not

required to manufacture/deliver the final

product/service but are required to operate the

organization

For example: Spend categories such as facilities,

office supplies, travel & logistics, marketing /

sales-related spend, and IT/telecom

High prevalence of third-party outsourcing

Low prevalence of third-party outsourcing

Beyond the process dimension, PO contracts also have

a “procurement-spend category” dimension


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2nd or 3rd quartile performance

across market success and

capability

High

Low

25

thp

erc

en

tile

75

thp

erc

en

tile

75th percentile

Ma

rke

t su

ccess

(Re

ve

nu

e, clie

nts

, a

nd

gro

wth

)Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix

Aspirants

Leaders

Major Contenders

PO delivery capability1

(Scale, scope, technology & innovation, delivery footprint, and buyer satisfaction)

Low High25th percentile

Everest Group classifies the PO service provider

landscape into Leaders, Major Contenders, and

Aspirants on the Everest Group PEAK Matrix

Top quartile performance


capability

4th quartile performance


capability

1 Service providers scored using Everest Group’s proprietary scoring methodology described on the following page



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Measures the breadth and

depth of scope of services

provided across:

Processes

Industries

Geographies

Categories

Buyer Size

Measures the technological

capabilities and innovation in

PO:

Technology model adoption

In-house suite of PO

technologies and investments

Innovation in PO – Service

delivery, offerings, and

innovative tools

Measures the delivery

footprint across regions and

the global sourcing mix

Measures success achieved in the

market. Captured through revenue,

number of clients, and growth rate as

of December 2014

Measures ability to deliver services successfully. Captured

through five subdimensions

Measures the scale of

operations through:

Overall company revenue

PO revenue as a

percentage of total

company revenue

Scale ScopeTechnology and

innovationDelivery footprint

Aspirants

Leaders

Major Contenders

Mark

et

su

ccess

Delivery capability

Service providers are positioned on the PEAK Matrix

based on evaluation across two key dimensions

Measures the satisfaction

levels1 of buyers across:

Goal realization

Process delivery

Implementation

Relationship management

Contract terminations were

also assessed to gauge

satisfaction levels

Buyer satisfaction

1 Measured through responses from two/three referenced buyers for each service provider



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Year 1

Year 0

Service

provider

Mark

et

su

ccess

Capability

Methodology

Everest Group selects Market Star Performers based on the relative YoY movement of each service provider

on the PEAK Matrix

In order to assess advancements on market

success, we evaluate the performance of each

service provider on the PEAK Matrix across a

number of parameters including:

Yearly ACV growth

Number of new contract signings

Number of contract extensions

Value of new contract signings

In order to assess advancements on

capability, we evaluate the performance of

each service provider on the PEAK Matrix

across a number of parameters including:

Increase in scope of services

Expansion of delivery footprint

Technology- / domain-specific

investments

The top quartile performers on each of the

identified parameters are selected and the

“Star Performer” rating is awarded to the service

providers with:

The maximum number of top quartile

performances across all of the above parameters

At least one area of top quartile performance in

both market success and capability advancement

The “Star Performers” title relates to YoY performance for a given service provider and does not reflect

the overall market leadership positions. Those identified as Star Performers may include “Leaders”,

“Major Contenders”, or “Aspirants”

Everest Group confers the “Star Performers” title to

providers that demonstrate the strongest forward

movement over time on the PEAK Matrix

2015 PO Star Performers


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FAQs (page 1 of 2)

Does the PEAK Matrix assessment incorporate any subjective criteria?

Everest Group’s PEAK Matrix assessment adopts an objective and fact-based approach (leveraging service

provider RFIs and Everest Group’s proprietary databases containing providers’ deals and operational capability

information). In addition, these results are validated / fine-tuned based on our market experience, buyer interaction,

and provider briefings

Is being a “Major Contender” or “Aspirant” on the PEAK Matrix, an unfavorable outcome?

No. PEAK Matrix highlights and positions only the best-in-class service providers in a particular functional/vertical

services area. There are a number of providers from the broader universe that are assessed and do not make it to

the PEAK Matrix at all. Therefore, being represented on the PEAK Matrix is itself a favorable recognition

What other aspects of PEAK Matrix assessment are relevant to buyers and providers besides the “PEAK

Matrix position”?

PEAK Matrix position is only one aspect of Everest Group’s overall assessment. In addition to assigning a “Leader”,

“Major Contender” or “Aspirant” title, Everest Group highlights the distinctive capabilities and unique attributes of all

the PEAK Matrix providers assessed in its report. The detailed metric level assessment and associated commentary

is helpful for buyers in selecting particular providers for their specific requirements. It also helps providers showcase

their strengths in specific areas

What are the incentives for buyers and providers to participate/provide input to PEAK Matrix research?

Participation incentives for buyers include a summary of key findings from the PEAK Matrix assessment

Participation incentives for providers include adequate representation and recognition of their capabilities/success in

the market place, and a copy of their own “profile” that is published by Everest Group as part of the “compendium of

PEAK Matrix providers” profiles


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FAQs (page 2 of 2)

What is the process for a service provider to leverage their PEAK Matrix positioning status ?

Providers can use their PEAK positioning rating in multiple ways including:

– Issue a press release declaring their positioning/rating

– Customized PEAK profile for circulation (with clients, prospects, etc.)

– Quotes from Everest Group analysts could be disseminated to the media

– Leverage PEAK branding across communications (e-mail signatures, marketing brochures, credential packs,

client presentations, etc.)

The provider must obtain the requisite licensing and distribution rights for the above activities through an

agreement with the designated POC at Everest Group

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About Everest Group

Everest Group is a consulting and research firm focused on strategic IT, business

services, and sourcing. We are trusted advisors to senior executives of leading

enterprises, providers, and investors. Our firm helps clients improve operational

and financial performance through a hands-on process that supports them in

making well-informed decisions that deliver high-impact results and achieve

sustained value. Our insight and guidance empowers clients to improve

organizational efficiency, effectiveness, agility, and responsiveness. What sets

Everest Group apart is the integration of deep sourcing knowledge, problem-

solving skills and original research. Details and in-depth content are available at

www.everestgrp.com and research.everestgrp.com.

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everest group peak matrix for po service providers...jan 27, 2016 · europe was the key growth...

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