shaping the battleground for gs100 sp

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GS100-2010 www. globalservicesmedia.com GlobalServices 5

Special Report

The recession changed several rules in global sourcing. The GS100 is a study

in how service providers withstood the shocks and adapted.

Shaing the Battleground for

GS100Service providers

by Ed Nair


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6 GlobalServices www. globalservicesmedia.com GS100-2010

hal o 2009. I act, th idustry put up a imprs-

siv prormac i th last quartr (Q409) with

markts total cotract valu (TCV) rachig $24.7

billio, a icras o 47 prct squtially ad

8 prct yar-ovr-yar ad th bst quartrly

prormac sic th scod quartr o 2008, ac-

cordig to fgurs rom TPI. Howvr, TPIs rportstatd: Full-yar 2009 rsults could ot ovrcom

th markts wak showig durig frst two quar-

trs. TCV or th yar dclid 13

prct to $74.5 billio, its lowst

poit sic 2001.

Fruits of a CrisisA moumtal crisis lik a historic r-

cssio has a moumtal impact o

th dyamics o th idustry. So did

th rcssio chag svral rulsi global sourcig which ld to w

bhaviors both o th clits ad o

th srvic providrs d. I 2010,

w s th prmac o ths b-

haviors, which i ct is about st-

tig th w agda or ralizig th

w ormal, whatvr you call it.

From a fcicy poit o viw,

buyrs hav b lookig at cosoli-

datig th umbr o vdors thy

hav to dal with. At th sam tim,

buyrs hav also startd splittigthir scop ad gagig with broadr st o spcial-

ist vdors. This trd kow as multisourcig has

giv accss ad opportuity to may mid-tir v-

dors but it has also ld to rductio i valu ad du-

ratio o outsourcig cotracts. This has ld to mor

WHen th coomy buckld dow ito

a rcssio i 2008, th global out-

sourcig idustry still smd vry

robust. Slowly, but surly, th im-

pact o th rcssio was lt by th idustry dur-

ig 2009. Compais clammd up o ambitious

tchology projcts that rquird hug outlaysi ivstmt ad CIOs wr orcd to oprat

o costraid IT budgts which largly ocusd

o squzig mor bag rom th

bucks that wr spt i th arlir

yars. Spdig was guidd by dis-

crtio ito aras that wr cs-

sary to kp th lights o ad sav-

ig costs bcam th drivig actor

i dcisios.

Outsourcigs pottial to sav

costs actually hlpd. Srvic provid-rs (vdors) wr orcd to oprat

i a w viromt i which thy

got paid or busiss outcoms rath-

r tha ort. O th BPO sid, a w

o th procsss rlatd to idustris

dirctly actd by th rcssio or

idustris dirctly rsposibl or

rcssio (lik mortgag procss-

ig, titl maagmt, tc.) almost

vaishd. I othr aras, whr

BPO partrships wr alrady u-

dr way, th srvic providrs wrtaskd with dlivrig busiss outcoms at lowr

cost. Thr wr vry bright spots i at all i both IT

srvics ad BPO.

Th markt rachd a bottom i th frst hal

o 2009 ad th startd rcovrig i th scod

Country % Number o Companies

US and Canada 37

India 33

China 6

Europe 9

Latin America 9

Asia 5

Category Aggregate Revenue 2009 (in $M)

$1M to $10M 55

$10M to $100 M 1,393

$100M to $1B 12,917

$1B + 58,999

Total 73,364

Global Coverage

Industry Size Coverage

Revenue Range % Number o Companies

$1M to $10M 12$10M to $100 M 30

$100M to $1B 45

$1B + 13

Signifcant Sample

The industry put

up an impressive

perormance in the

last quarter (Q409)

with markets total

contract value (TCV)

reaching $24.7

billion, an increase

o 47 percent

sequentially

The Global Services 100 SurveyParticipants Spread


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8 GlobalServices www. globalservicesmedia.com GS100-2010

comptitio amogst vdors.

Th rcssio also brought ito ocus may is-

sus rlatd to cotracts, SLAs, prormac ma-

agmt, ad pricig. Pric rgotiatios wr

all too commo. Mor importatly, most vdorshad to dlivr udr outcom-basd pricig. Alog

with pricig, practics about risk maagmt ad

govrac wr topics o itrst.

Ths aras movd rom big co-

cpts to practics. Othr actors ot

rlatd to rcssio lik th pot-

tial o cloud computig ad its im-

pact o dlivry o srvics, itgra-

tio or covrgc o IT ad BPO,

M&As btw srvic providrs,

maturig o srvic providrs rom

Ctral ad eastr europ, Lati

Amrica ad Chia, thratd to

chag th ladscap o th srvic-

s idustry.

Durig this tir pisod, th sr-

vic providr commuity was both

rsilit ad adaptiv. Th storms

thy bravd wr ar mor svr

tha th os acd by th buyrs.

Ths ar th Global Srvics 100

compais, th list o 100 compais

that will rlasd i th last phas othis study.

GS100: Recognizing and CelebratingService Provider ExcellenceTh Global Srvics 100 is a ort to rcogiz ad

clbrat srvic providr xcllc. It lists sr-

vic providrs who possss th maturity to dlivrhigh stadard srvics i IT ad BPO usig th glob-

al dlivry modl. Th GS100 srvic providrs pos-

sss may othr attributs that lad

to markt ladrship ad th study

is itdd to tak a closr look at

ths.

This yar w had ovr 150 com-

pais that participatd i th study

ad volutarily shard lot o qua-

titativ ad qualitativ iormatio

about thir compais. Th absc

o a w Tir1 compais lik Ac-

ctur, IBM, H-P, ad Cogizat

amogst othrs is xplaid ithr

by thir uwilligss to shar data

du to policy or by thir uwillig-

ss to put i th ort rquird to

participat. From a statistical sigif-

cac poit o viw, th study rp-

rsts rlvat sampls across all

catgoris (rvu bads) o com-

pais. Thror, th obsrvatios

rmai statistically sigifcat adcoclusiv. GS

The storms they

braved were ar more

severe than the ones

aced by the buyers.

These are the

Global Services 100

companies, the list

o 100 companies

that will released

in the last phase o

this study

shaping the battleground for gs100 sp

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