Global Services magazine has identified the 100 best IT and BPO service providers from 17 countries in its fourth annual survey to be made public next month. This will help Chief Information Officers (CIOs) and business heads of major outsourcers identify reliable, innovative and tech savvy partners. 

The list includes 43 U.S.A. and 29 India headquartered companies. The presence of four companies each from China and Malaysia, and three each from Russia and Brazil serves as a gentle reminder that these countries are emerging as viable outsourcing destinations, adds the survey. 

Two companies each headquartered in Argentina, Canada, Mexico, the Philippines, Singapore and the U.K. have made it to the list. Only one Czech Republic, France and Ukraine headquartered company each made it to the list.

The editors of Global Services along with analysts from premier services globalization advisory firm, neoIT, identified service providers from 17 countries, with delivery centers across 31 countries.

Functionally, these providers covered a range of services across IT and BPO, including IT Application Services, Infrastructure, Finance and Accounting Outsourcing (FAO), Human Resources Outsourcing (HRO) and Contact Centers. 

The ‘2008 Global Services 100’ listing identified the best companies in 10 categories to cover technology providers; customer service and business-process providers; and providers by regions. 

“The 2008 Global Services 100 represents the world’s best providers of technology, customer service and business process services,” says Pradeep Gupta, Chairman of CyberMedia, publishers of Global Services magazine.

The toppers from each of the 10 categories included four companies each from the U.S.A. and India and one company each from China and Mexico. They included India’s Tata Consultancy Services, HCL Technologies, Genpact, WNS Global Services; America’s EDS, Sitel, EPAM Systems and Computer Sciences Corporation; Mexico’s Softtek and China’s Neusoft.

The year 2007 reported a total of 436 M&A deals in the services industry. Nearly one-third of the Global Services survey respondents said that they merged with or acquired one or more providers. Of these, 11 percent confirmed acquisition of a consulting firm.

Choice of a quick inorganic route to growth helped companies gain a readymade talent base and access to new geographies, and customer base. As the global services industry matures and consolidates, the M&As of 2007 are just a sign of many more to come in the future, the survey adds.

The Global Services survey says that 47 per cent of the respondents saw the sliding dollar and the strengthening currencies of some key outsourcing destinations (India, the Philippines and Canada) as the most critical business concern. Many service providers are compromising on their margins and putting a hold on hiring plans. 

The Indian service providers who derive between two-third to three-fourth of their revenues from the U.S.A. are back to the drawing board to consider non-U.S. avenues. While many IT-services companies were looking towards Europe and Japan as potential markets, others have strengthened plans for servicing the maturing domestic Indian market. 

The survey adds that going forward outsourcers could expect price increases and currency risk sharing defined in the contracts. 

ADM, Back-office Operations: Top the Charts 
Over 46 percent respondents to the Global Services survey handled outsourced Application Development and Maintenance (ADM) work, followed by 30 percent who specialized in outsourced managed services while 10 percent handled engineering or R&D services. On the BPO front, 65.7 percent providers specialized in back-office operations.

While it is challenging to align people and capital to correlate IT and BPO operations, the demand for bundled IT and BPO services by customers of services remained steadily high over the past two years. Fifty four per cent of respondents to the 2008 Global Services 100 survey said that they saw customers seeking more bundled IT and BPO services than in the past. 

About 48.4 percent of the global services providers polled offer both IT and BPO services; 21.6 percent provide only BPO services and 30 percent offer only IT services.

"In its fourth year, the Global Services 100 study has become an industry benchmark and an essential reference for clients starting or re-evaluating sourcing relationships with global service providers," says Eugene Kublanov, CEO, neoIT.

India Reigns Supreme as a Delivery Location
India has emerged as the hub for global delivery with 57 percent of the employees engaged in delivery centers located in India, followed by 18 percent in the U.S.A. Coincidentally, software delivery centers of IBM in India also employ 57 per cent of the U.S. headquartered giant’s full-time employees world wide. China had just 3 per cent of the full-time employees. Central and Eastern Europe followed with a similar number. Canada and Australia were at the bottom of the pile with just one per cent each of the employees. 

The 10 category winners
The $ 4.3 billion software provider Tata Consultancy Services (TCS) topped the list of best performing IT services companies list. With over 100,000 employees and delivery centers in India, Australia, U.S.A., U.K. and Europe, TCS also featured among leaders in two other categories — Infrastructure Service Provider and Human Capital Development.

The best performing infrastructure service provider title has gone to HCL Technologies, one of the earliest providers of Remote Infrastructure Management. The 45,000-strong HCL Technologies also features in the Global Services’ Top 10 list of IT Service Providers, FAO Providers and leaders in Human Capital Development.

The best performing BPO provider honor has gone to Genpact, which boasts over 30 delivery centers in the U.S.A., Mexico, India, China, Philippines, Romania and Hungary. With over 10 years in the BPO business, it is not surprising that Genpact, once a GE-promoted company, is also among the best performing FAO providers and leaders in Human Capital Development. 

With nearly one fourth of WNS Global Services’ 17,000-employees working with FAO customers, it is not surprising to see this company top the best performing FAO providers list. One of the early starters in the BPO space in India, WNS has Travelocity, British Airways and United Airlines among its customers and also ranks among leaders in the top performing HRO providers listing. 

The title for the best performing Human Resources Outsourcing company goes to EDS. The $16 billion outsourcing behemoth, EDS earned nearly one fifth of its revenues from the BPO space. The 1962-founded company acquired a majority stake in one of the leading applications and BPO services provider, MphasiS. EDS was also listed among the Top 10 best performing infrastructure service providers.

The best performing contact center title went to Sitel that has specialized in call-center management and back office processing for over 20 years. Sitel has 155 centers spread across 27 countries with a very strong presence in Latin America. 

The winner of the Leader, South of the Border title was Mexico headquartered Softtek. Regarded as one of Mexico’s most renowned IT Services provider, Softtek expanded to the East by acquiring I.T. United, a China-based IT-services provider. Softtek was also listed among the top 10 IT-services providers by Global Services 100 survey.

The Leader of the Emerging European Markets title was won by the Russian services company, EPAM Systems. The company’s well-entrenched delivery capabilities spread from Ukraine to Budapest servicing high profile customers like Oracle and Reuters. EPAM was also listed among the Top 10 best performing IT services providers.

The Leader of the Emerging Asian Markets title went to the Chinese offshore IT-services company, Neusoft. This 16-year old Chinese application development, maintenance services and engineering services provider with over 13500 employees handles work for Boeing, Motorola and Sony.

The 49-year old Computer Sciences Corporation won the Leader, Human Capital Development recognition for its immense focus on human capital development. With delivery centers in India, China, U.K. and U.S.A., Computer Sciences Corporation acquired Covansys and First Consulting Group. 

Infosys Technologies was listed among the Top 10 in five categories. The other companies to feature among the top firms across multiple categories include India’s HCL Technologies (4), America’s 24/7 Customer and Neoris, India’s Genpact, EXL Services, Tata Consultancy Services and WNS Global Services and Philippines’ SPi Technologies were listed among top 10 in three categories.

About the Methodology
The top 100 list and the ranks in the 10 categories are based on a scientific methodology, starting with the responses being clubbed under four broad buckets: Size (revenue, employee strength, geographies covered, etc.), customers (customer base, testimonials and references, average contract size, etc.), skills (depth and breadth of offerings, delivery capability, quality initiatives, verticals covered, etc.) and others (attrition, training, etc.).

A weighted scoring scheme was used to rate each question. For the category lists, weights were assigned to address specific strengths and capabilities. 

The scoring scheme was designed by a panel from Global Services’ and neoIT’s practice experts. Care was taken to ensure that all service providers (global, niche or regional) were given a level playing field. For a revenue-based question, for example, if the scoring scheme gave weightage to higher revenue, small or niche companies pared this disadvantage by scoring high on better growth rates. 

The 2008 Global Services 100 study along with the list of the top 100 service providers and the toppers in 10 categories can be seen at globalservicesmedia.com in February 2008.

About Global Services
Global Services, a media platform by CyberMedia, facilitates the global service delivery for customers and service providers of IT and business-process outsourcing services, and provides cost-effective marketing solutions to the service providers in this industry. A multishore team spanning the U.S.A. and India drives the Global Services brand. The Global Services brand is an integrated media platform that includes the website globalservicesmedia.com and global seminars. 

About CyberMedia
CyberMedia, now in its 25th year, is South Asia's first and largest specialty media house, with fifteen publications (including Dataquest, DQ Channels and DQ Week, PCQuest, Voice&Data, Global Services and DARE) in the infotech, telecom, consumer electronics, biotech and entrepreneurship areas, and is a media value chain including Internet (www.ciol.com), events and television. The group's media services include market research (IDC India), job board (CyberMedia Dice), content management, multimedia, and media education. 

CyberMedia also publishes BioSpectrum Asia from Singapore and Global Services from the U.S.A., the first Indian magazine titles to be published from outside the country for a global audience. 

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At Global Services
Ed Nair
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ed@cybermedia.co.in 

www.globalservicesmedia.com
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