By Amy Gurchensky, Liz Rennie and Gary Bragar With total HRO service growth in the high single digits in 2014, service providers are growing both organically and inorganically to meet clients’ needs. The primary reasons for M&A and partnerships across HRO service lines were to enhance service delivery capability (60%) and support geographic expansion (40%). Here we take a closer look [...]

TCS has briefed NelsonHall on the recent launch of its DevOps related IP, Non-Production Environment Tracking and Release Automation (NETRA). With NETRA, TCS Assurance Services Unit (ASU), the main testing unit of TCS, is pursuing its strategy originated with Intelligent Testing Systems (ITS) to develop broad-reaching IPs, encompassing open source software, COTS, and TCS-developed accelerators.[...]

TCS Globally: High Market Cap, High Brand Value With over $15bn in revenues in CY 2014 (and FY 2015 revenues likely to be in the region of $15.5bn) TCS is not only one of the largest, fastest growing and most profitable service providers but is now also a top 5 IT services player (*) on the global stage. And TCS is also the most profitable of the Top 5, with an EBIT margin currently tracking at[...]

By Amy Gurchensky, Liz Rennie, Gary Bragar 2014 was a busy year for HRO with ~60 partnerships, mergers and acquisitions combined. We now take a look at what to expect in 2015 and beyond for each HRO service line, including service offerings, market developments, and growth. MPHRO driven by continued shift to cloud-based platforms The Multi-Process HRO (MPHRO) market will grow with a mi[...]

NelsonHall, the leading global BPO and IT outsourcing analyst firm, has today launched a new tool to assist strategic sourcing managers in assessing vendor capability in Application Outsourcing (AO) services. This NelsonHall Vendor Evaluation and Assessment Tool (NEAT) is now available to NelsonHall clients, and is also available for a period free-of-charge to buy-side organizations through Nel[...]

NelsonHall, the leading global BPO and IT outsourcing analyst firm, has today launched a new tool to assist strategic sourcing managers in assessing vendor capability in Property & Casualty Insurance BPO for the automotive sector. The NelsonHall Vendor Evaluation and Assessment Tool (NEAT) for P&C BPO in the automotive sector is now available to NelsonHall clients, and is also available[...]

Last week we looked at Infosys' quarterly results. It has been another busy week of quarterly reports from some of the Indian oriented service providers. How did five of them do? Syntel (Q3 CY14): Softness in Healthcare Greater than Expected Revenue was $228.3m, up 8.8% y/y, but slightly below consensus Operating margin was 29.8%, down 610 bps y/y, with less benefit from rupee depre[...]

TCS, Infosys and SQS have recently published their calendar Q1 and H1 2014 revenues, and provided financial details on their software testing revenues (see notes below). In calendar H1 2014 (all numbers below are constant perimeter NelsonHall estimates): TCS: revenues were ~+24% to ~$612m (H1 2013: ~+23%) Infosys: ~+21% to ~$395m (H1 2013: ~+15%) SQS: + 9% to €129m (~$174m) (H1 2[...]

When you look at the financial performance of the four largest Indian oriented IT service providers (IOSPs) over the last four years, it becomes evident that there is a direct correlation between the level of topline growth they achieve and their expenditure on sales and marketing (S&M)…with EBIT margins benefiting from the strong topline growth. Let’s look at a few data points[...]

The latest large partnership and implementation of Workday was announced August 13, 2014 by CSC who will establish a consulting practice enabling clients to transition to Workday, and also deploy Workday internally to ~70k employees globally. The move to launch Workday consulting and implementation practices, often alongside HR BPO capability, has already achieved considerable momentum. Similar[...]

CSC recently briefed NelsonHall on its SAP Next-Gen offering, unveiled in June 2014. CSC’s SAP practice is relatively large within CSC (headcount 7.7k, ~10% of CSC’s overall 80k). CSC has recently engaged in a service portfolio refresh to increase its differentiation through more specialized SAP-related services. This differentiation relies on adoption of automation tools and enhanc[...]

CSC has expanded its partnership with IBM to enhance its ability to offer hybrid cloud and mobility services. In particular, the partnership emphasizes CSC's continuation and development of its role as a cloud service integrator and manager, rather than as a direct provider of capital-intensive IaaS services. CSC has a large client base for traditional data center management, frequently using [...]

In addition to providing assessments of MPHRO vendor capability, the NelsonHall Evaluation and Assessment Tool (NEAT) for MPHRO, published July 29, 2014, http://bit.ly/1uDunOq supports an analysis of customer satisfaction within MPHRO by service line. Based on client interviews conducted globally covering vendors providing MPHRO across all regions, the analysis covers satisfaction within the [...]

NelsonHall, the leading global BPO and IT outsourcing analyst firm, has today launched a new tool to assist strategic sourcing managers in assessing vendor capability in multi-process HR outsourcing (MPHRO). The MPHRO tool is available to NelsonHall clients and is also available for a limited period free-of-charge to strategic sourcing managers. In addition to a comparison of overall ve[...]

In case anyone has missed the phenomenon that is TCS, it has achieved over 16% y/y growth in four of the last five quarters (with “just” 15.3% in the fifth). This quarter, it reported a y/y increase of nearly $530m in revenue. If TCS continues at this pace – and management commentary is of a strong pipeline – then revenues this fiscal year should be around $15.5bn. TCS has [...]

Per NelsonHall’s learning BPO market analysis and concurrent client interviews conducted as part of the NelsonHall Evaluation and Assessment Tool (NEAT), both providers and buyers (current and prospective), will be pleased to know that learning BPO is largely meeting and exceeding client expected benefits in six out of seven criteria sought by clients. Based on interviews with LBPO client[...]

TCS recently briefed NelsonHall on the intelligent testing system (ITS) it launched in April 2013 in an effort to automate tasks across the software testing lifecycle. It intends to  expand usage of test automation from test execution to include other tasks e.g. test design and test support services such as test data management and service virtualization. ITS integrates COTS tools e.g. Inf[...]

NelsonHall’s annual HRO Market Forecast, 2014-2018, provides a forecast for the global HR BPO market by service line and geography. It includes:  The HR BPO market size for 2013 and the forecast through 2014 to 2018 The HR BPO market size and forecast for North America, specifically covering the U.S. and Canada; EMEA including U.K., France, Germany, Italy, Nordics &[...]

TCS has announced that it has signed an agreement with Mitsubishi Corporation (MC) to merge TCS Japan, IT Frontier Corporation (ITF), MC’s 100% owned IT subsidiary, and Nippon TCS Solution Center (NTSC) as a single new entity in which TCS will have a majority 51% stake and MC 49%. The transaction is expected to close by end June 2014. The new entity will have over local 2,400 employe[...]

TCS and Infosys have both now reported their Q4 and full FY 2014 results. A quick look at their respective revenue numbers (not to mention margins, utilization and attrition rates) highlights very significant difference in performance across geographies, service lines and industries, with TCS surging ahead across the board, in many of them at a level that is simply breath-taking.  [...]