global tpi index - 4q12 and fy12
TRANSCRIPT
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Moshe Katri, Cowen and Company
16 January 2013
The TPI Index
Fourth Quarter and Full Year 2012
Global Sourcing Market Data and Insights
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*Contracts with ACV ≥ $5M
2
Covering the state of the outsourcing industry for global, commercial contracts.*
John Keppel President & Chief Marketing Officer
Esteban Herrera Partner Americas
Welcome to the 41st Quarterly Outsourcing Index Review
Dr. David Howie Partner EMEA
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*Contracts with ACV ≥ $5M
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At A Glance
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*Contracts with ACV ≥ $5M
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ACV was down 27% Y/Y and 11% Q/Q on a strong 3Q and as the industry paused due to the US Election. For the full year, ACV of $21B was down 3% from 2011.
Broader Market ACV ($B)*
Broader Market Counts
Broader Market Contract Award Trends
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*Contracts with ACV ≥ $5M
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34 Mega-relationships were awarded in 2012, up 36%. Restructuring activity is prevalent in large deals for the third straight year.
Mega-relationship Contracts - ACV > $100M
Mega-relationship New/Restructured ACV
Broader Market Contract Trends for the Largest Deals
Mega-relationship Counts
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*Contracts with ACV ≥ $5M
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ITO ACV was down 37% Y/Y and 18% Q/Q. For the full year, ACV was down 11% on diminishing New Scope awards.
ITO Annual ACV ($B)*
ITO Contract Award Trends
ITO Counts
Accenture
Atos
BT
Capgemini
CGI1
CSC
Dell
Fujitsu
HCL
HP
IBM
Infosys
Mahindra Satyam1
TCS
T-Systems
Top 15 ITO Providers by 2012 ACV Awarded
Note: Service providers in alphabetical order; no rankings implied. Placements sourced from ISG Contracts Knowledgebase®.
1New in 2012
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*Contracts with ACV ≥ $5M
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BPO ACV was flat Y/Y and up 5% Q/Q. For the full year, ACV was up 14% because of several large contract awards.
BPO Annual ACV ($B)*
BPO Contract Award Trends
Top 15 BPO Providers by 2012 ACV Awarded
Accenture2
Aditya Birla Minacs
Capgemini2
Genpact2
HCL2
HP
IBM2
Infosys2
ISS Global
Jones Lang LaSalle
Mahindra Satyam
MITIE Group
Sodexho Alliance
Xchanging
Xerox2
BPO Counts
Note: Service providers in alphabetical order; no rankings implied. Placements sourced from ISG Contracts Knowledgebase®.
2Repeat from 2011
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*Contracts with ACV ≥ $5M
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Americas ACV was down 28% Y/Y and 9% Q/Q and full year ACV was down 3%. New Scope ACV remarkably consistent on a quarterly basis throughout the year.
Americas ACV ($B)*
Americas Contract Award Trends
Americas ITO and BPO ACV ($B)* Americas New and Restructured ACV ($B)*
$4.4
$5.6 $6.1 $5.9
$4.2
$5.4 $4.9 $5.0 $5.3 $5.1
$3.5 $2.4 $2.8
$2.4 $1.9
$1.4
$2.6 $2.5 $1.8
$2.3
201211100908070605042003
New Scope Restructured
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*Contracts with ACV ≥ $5M
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LATAM markets were up significantly in 2012, while the U.S. market finished slightly below it’s five year average.
Americas Contract Award Trends Detail
Americas Sub-region ACV ($B)* Americas Industry ACV ($B)*
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EMEA ACV was down 29% Y/Y and 6% Q/Q. For the full Year, ACV was down 12% on lighter contracting activity.
EMEA ACV ($B)*
EMEA Contract Award Trends
EMEA ITO and BPO ACV ($B)* EMEA New and Restructured ACV ($B)*
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EMEA Contract Award Trends Detail
EMEA Sub-region ACV ($B)*
For the year, UK ACV was up 20% over 2011 and the Nordics and Benelux saw improvement. Financial Services ACV grew by 9% over 2011.
EMEA Industry ACV ($B)*
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Asia Pacific ACV was flat Y/Y and down 34% Q/Q; For the year, ACV is up 55% off strong performance from the second quarter.
Asia Pacific ACV ($B)*
Asia Pacific Contract Award Trends
AP ITO and BPO ACV ($B)* AP New and Restructured ACV ($B)*
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The emerging markets of India, China and ASEAN lead Asia Pacific to record ACV result in 2012. ANZ, the traditional market leader, experienced a downturn.
Asia Pacific Contract Award Trends Detail
Asia Pacific Sub-region ACV ($B)* AP Industry ACV ($B)*
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The top service providers in each region based on total 2012 ACV awarded
Top Service Providers Across the Globe
Note: Service providers in alphabetical order; no rankings implied. Placements based on 2012 ACV commercial contract awards sourced from ISG Contracts Knowledgebase ®.
Special Topic for Fourth Quarter 2012
John Keppel President & Chief Marketing Officer
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*Contracts with ACV ≥ $5M
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Key Short-term Trends in Sourcing for 2013 and Beyond
Emerging Markets to Continue their Increasing Impact on Sourcing ACV
LatinAm and Mexico
China and India
ACV Change from 2007
+150% +100%
BPO Expansion Continues with Industry Specific Solutions Leading the Way
$ +60%
BPO ACV Change from 2010
$ $ $ $ $ $ $ $
U.S. G201-500 Companies Recent Sourcing Adoption Rate Expands Large Deal Potential for Providers
2010 2012 32%
Adoption Rate
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Disruptive Technologies Shape Long-term Industry Trends Four disruptive technology trends impact enterprises today and shape long-term industry trends: Social Media, Mobility, Cloud Computing and Big Data.
Social Media Collaboration
Computing & Storage
Mobility
Big Data/Analytics
Cloud
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*Contracts with ACV ≥ $5M
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Case Study: Tech Trends Spur Transformative Solutions BT “Global Trace“ provides TNT with a cloud-based solution that leverages Big Data and Analytics to improve customer satisfaction and operational efficiency.
Social Media Collaboration
Computing & Storage
Mobility
Big Data/Analytics
Cloud
Social Media Data + Supply Chain Data +
External Data Sources
Global Trace utilizes real-time data
stored in the Cloud and analyzed with software
edge adaptors to improve client decision making
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*Contracts with ACV ≥ $5M
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4Q ACV underperformed 3Q, yet 2012 performance nearly met 2011 levels
Fewer contracts were awarded for 2012, but Mega-relationships supported the market value
BPO ACV and Asia Pacific ACV helped lift Broader Market for 2012
Contract push-out and lingering fiscal uncertainties in both the U.S. and Europe could make for a softer first half in 2013
Outlook for 2013 ACV awards is one of cautious optimism
Market growth, in terms of Annualized Revenue, is projected to be 3 - 4% in 2013
4Q12 TPI Index Summary and Outlook
summary market
outlook market
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*Contracts with ACV ≥ $5M
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Please contact us with your questions and comments.
Learn More
--- Media Contacts ---
► John Keppel President & Chief Marketing Officer +44 (0)7879 432 212 [email protected]
► Andrew Park Director, ISG +1 919 259 9252 [email protected]
► Gwennie Poor Cohn & Wolfe for ISG +1 212 798 9842 [email protected]
blog.isg-one.com
Fourth Quarter and Full Year 2012
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*Contracts with ACV ≥ $5M
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The TPI Index has moved to ACV as the primary measure of the Broader Market. In transition, we will continue to provide a high-level TCV view of the market via a Scorecard analysis.
4Q12 TCV Scorecard
*Contracts with TCV ≥ $25M
4Q12 4Q Y/Y 4Q Q/Q 2012 2012 Y/Y
Scorecard TCV ($B)* Change Change TCV ($B)* Change
Global Market $ 23.4 -33% -10% $ 99.1 -9%
New Scope $ 15.8 -31% -6% $ 66.2 -9%
Restructurings $ 7.6 -35% -16% $ 32.9 -10%
Mega-deals $ 2.4 -78% -59% $ 16.0 -34%
ITO $ 14.1 -40% -16% $ 62.6 -15%
BPO $ 9.3 -17% 3% $ 36.5 1%
Americas $ 7.8 -24% -16% $ 37.5 0%
EMEA $ 12.8 -40% -4% $ 48.6 -22%
Asia Pacific $ 2.8 -7% -13% $ 13.0 31%
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