Accenture Gartner 2013 CRM MQ

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G00248693

Magic Quadrant for CRM Service Providers,

WorldwidePublished: 18 September 2013

Analyst(s): Patrick J. Sullivan, Ed Thompson

CRM implementation services continue to be in high demand. Service

providers are widening beyond CRM software to include consulting,

analytics, digital enterprise and social CRM. Here, we position CRM service

providers to help enterprises identify providers that best fit their needs.

Market Definition/DescriptionThis Magic Quadrant focuses on the CRM consulting and solution implementation service market

worldwide. To provide market context, we define solution implementation services and CRM here:

Solution implementation services Solution implementation services are offerings to design,

develop, integrate and deploy specific processes, functions, applications or initiatives in user

organizations. These services aim to optimize a company's processes and integrate related

technology applications and platforms (see "Forecast: Application Solution Services,

Worldwide, 2010-2015").

CRM Gartner defines CRM as a business strategy in which the outcomes optimize

profitability, revenue and customer satisfaction by organizing around customer segments,

fostering customer-satisfying behavior and implementing customer-centered processes. This

marketplace, competitor categories and characteristics are described in "Competitive

Landscape: CRM Service Providers, North America and Western Europe."

This research addresses all five CRM domains:

Sales Solutions that support field sales, telesales, retail sales, Web sales and technology-

enabled buying

Marketing Solutions that support market segmentation, marketing analysis, campaign

management, marketing process automation and other marketing functions, including analytics

Customer service and support Solutions that support customer service and support

processes, including consulting, technology implementation and solution deployment, but

excluding the outsourcing of call center and customer service centers

E-commerce Solutions that support e-commerce storefronts, product catalogs,

personalization, mobile commerce and social commerce


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Cross-CRM solutionsIncluding master data management, multichannel business process

management, voice of the customer and customer analytics

For more information, see "Use Gartner's CRM Application Functionality Starfish to Evaluate Your

CRM Requirements."

Magic Quadrant

Figure 1. Magic Quadrant for CRM Service Providers, Worldwide

Source: Gartner (September 2013)

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Vendor Strengths and Cautions

Accenture

Accenture is a Leader in this Magic Quadrant. Accenture is a good fit for large, complex CRMinitiatives, with well-defined business benefits. Gartner estimates that Accenture is one of the two

largest CRM service providers worldwide in terms of both revenue and staff, with CRM revenue

estimated to be between $2.0 billion and $2.2 billion (or 7% of all Accenture revenue and 16% of all

consulting revenue). Accenture has the largest salesforce.com practice and very large practices in

Siebel and SAP CRM, and it partners with Avanade to support Microsoft Dynamics CRM (Avanade

is a joint venture between Accenture and Microsoft to focus on services related to Microsoft

technologies).

Strengths

CRM focus, scale and scopeAccenture has a corporate focus on CRM services and hassteadily invested in solutions, skills, practitioners and practices that encompass business,

technical and domain skills across all major CRM domains and software. Gartner estimates that

Accenture's CRM staff numbers about 16,000 dedicated full-time equivalents globally.

Accenture has the ability to support global and multinational accounts due to its extensive scale

and global breadth.

VisionAccenture approaches the market from a business consulting and technology-

enabled transformation perspective. Accenture perceives CRM services to be outcome-driven,

requiring end-to-end services to improve clients' business results. This incorporates multiple

domains that encompass business consulting, rearchitecting business models, digital design,

customer analytics, e-commerce and customer experience. Accenture also conducts extensive

market research in CRM, which enables Accenture to be quicker than most of its competitors to

identify new patterns of demand, set out a vision for CRM and then innovate its services to

match.

VisibilityFor the eighth year running, Accenture remains far and away the vendor that is

most included and evaluated on shortlists by reference customers, reflecting both its brand and

market presence.

Partnership with CRM software providersAccenture has focused practices and solutions

for each of the four largest CRM software solutions and is the largest consulting and integration

partner for Oracle, SAP, salesforce.com and Microsoft Dynamics CRM (with Avanade) in terms

of both staff and revenue. Accenture has also invested in industry- and process-specificsolutions with each of the four partners to drive additional business value.

Cautions

Premium price According to Gartner reference checks, the most common reason Accenture

has lost competitive bids (for the seventh year running) is because of the premium price of its

services. Almost 40% of references from other providers who evaluated but did not select

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Accenture said the reason for not selecting Accenture was the price was too high. References

also rated Accenture below average for the total cost for the contracted services. If pricing is a

top criterion for selection, then evaluate Accenture with care, but if the focus is on complex

transformation through CRM, Accenture is a sound choice.

Value for price Gartner references rated Accenture relatively low in overall value, and webelieve that this reflects a high price point for services relative to average ratings for overall

satisfaction, as well as an average rating related to providing references to peers. Accenture is a

safe choice for CRM solutions when complex business-driven solutions and risk management

are more critical than price.

BearingPoint

BearingPoint is a Visionary in the 2013 CRM Magic Quadrant. BearingPoint, West Monroe Partners

and ABeam have formed a strategic partnership they call "Global Network" and jointly support

clients globally using combined assets and shared processes. All three firms approach CRM from a

consulting and applied analytics perspective and are a good fit for enterprises seeking business-driven CRM strategy and/or complex customer service solutions. Gartner estimates that

BearingPoint and its partners combined make up the 11th largest CRM service provider worldwide,

with CRM revenue of about $175 million from the Global Network. Global Network has very large

practices in SAP CRM, salesforce.com and Microsoft Dynamics CRM, as well as competencies in

Siebel and Oracle Fusion.

Strengths

Business consulting BearingPoint's understanding of business needs and its investment in

research have translated into a business-driven CRM practice with innovative solutions.

References cited capabilities of business acumen, business consulting, change management,analytics and industry expertise as reasons for selecting BearingPoint. BearingPoint has the

second highest percentage of revenue derived from CRM consulting services.

Peer recommendation and customer satisfaction In our reference checks, BearingPoint

was rated highly by clients in several aspects, including overall customer satisfaction, overall

value, propensity to rehire and willingness to recommend to peers.

Industries The largest proportion of BearingPoint's CRM resource skills and project

experience in 2012 was from a few consumer-oriented industries that have high CRM adoption:

telecommunications, business services, utilities, retail, consumer goods (especially luxury

goods), banking and pharmaceuticals.

Focused strategy BearingPoint, along with its Global Network partners, has a focused

strategy for CRM that leverages the partners' strengths and synergies. This strategy focuses on

six key areas to increase differentiation: e-commerce, digital innovation, CRM cloud

deployments (salesforce.com, Microsoft Dynamics CRM), customer experience in banking,

sales and marketing enablement in pharmaceuticals, and customer experience measurement.



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Cautions

Software understanding According to references from other providers who evaluated but

did not select BearingPoint, the most frequently cited reasons why they did not select

BearingPoint were limited understanding of the specific software platform for the engagement

and limited technical expertise relative to other providers. Given BearingPoint's businessconsulting orientation, customers with a primary focus on CRM package expertise should

evaluate the Global Network on a case-by-case basis.

Geographical coverage The Global Network partnership is strong and becoming more

effective, but the combined entity still generates 79% of CRM revenue from BearingPoint's

efforts in Europe and has a limited presence outside its strongholds in France, Germany, the

U.K., the Netherlands, Switzerland, Austria, Belgium and the Nordics. ABeam's CRM efforts

have been primarily in Japan and are now starting to expand in Asia, which limits Global

Network in this region. That said, BearingPoint has put together partnerships with other regional

CRM consultancies in Italy, Spain, Argentina and Brazil to enable global or panregional delivery

of projects and the ability to serve global enterprises more seamlessly.

Global delivery Reference customers said 80% of work was done on-site (the highest of all

providers), a further 19% done off-site but in the same country, and only 1% done offshore or

nearshore. BearingPoint's limited ability to scale system integration services compared with its

peer set is also a concern; however, its partnership agreement with Tata Consultancy Services

to enable global delivery helps mitigate this limitation.

Price According to Gartner reference checks, the most common reason BearingPoint loses

competitive bids is because of the price of its services. This is likely related to the consultative

approach and also to the high level of on-site and local delivery.

Business & Decision

Business & Decision remains a Niche Player in this Magic Quadrant due to its limited scale and

geographic footprint. Business & Decision is a good fit for European enterprises seeking CRM

solutions that are focused on customer revenue generation with heavy use of CRM analytics,

particularly when focused on marketing initiatives. Gartner estimates that Business & Decision is the

15th largest CRM service provider worldwide, with revenue estimated to be about $130 million.

Business & Decision has established a global focus in Microsoft Dynamics CRM and Adobe

(Neolane), as well as dedicated practices in salesforce.com, Siebel, Oracle Fusion and Coheris.

Strengths

Marketing services Business & Decision had the highest focus and percentage of revenue

related to marketing services of all providers. This corresponds to the focus on the front office

to know, attract, reach and develop customers.

Industries Business & Decision focuses its CRM efforts and skills on selected vertical

industries in Europe that are consumer-centric (insurance, banking, hospitality, retail,

telecommunications and media), while its North American practice focuses on manufacturing.



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Analytics Business & Decision, as a firm, generates more than 60% of overall revenue from

business intelligence (BI). This is reflected in its CRM practice, which has strong marketing

analytical skills in areas such as lead management, segmentation and campaign automation.

Cautions

Growth Business & Decision's CRM revenue growth in 2012 was about 1%, which is below

the market average for CRM in Europe and significantly below the global market average of

11%.

Program and project managementCompared with competitors, Business & Decision had

relatively low scores in program management and project management execution, as well as in

knowledge transfer, from its reference customers.

Global delivery Business & Decision has small numbers of offshore resources in India,

Tunisia and Mauritius. The company uses nearshore or off-site centers, but it lags behind most

competitors in its ability to use offshore resources to deliver CRM services. Customerreferences said that 71% of work was done on-site, 24% off-site but in the same country, 5%

nearshore and 0% using offshore resources. This is aligned with the business consulting and

analytic approach that requires higher on-site presence, but it limits scalability and price

competitiveness at times.

Geographic coverage Business & Decision has a strong presence in France, Belgium and

Switzerland; a growing presence in the U.K.; and a differentiating presence in North Africa. Its

North American services expanded significantly with the 2012 acquisition of AbilityCRM, but

more than 80% of revenue is still generated in Europe and more than 50% from France.

Business & Decision has only a small presence in Latin America (Peru) and remains

comparatively weak in parts of Europe (the Nordics, Italy and Central Europe) and other regions

of the world (Asia, the Middle East, Africa and Latin America) compared with market leaders.

Capgemini

Capgemini is positioned in the Leaders quadrant. Capgemini is a good fit for enterprises in the U.S.

or Western Europe seeking help with large-scale or complex projects needing both CRM technical

advisory and implementation skills. Gartner estimates that Capgemini is the fifth largest CRM

service provider worldwide, with CRM revenue estimated to be about $1 billion (accounting for

about 17% of its consulting and technology service revenue). Capgemini has very large practices in

SAP CRM, Siebel and salesforce.com, with additional competencies in Microsoft Dynamics CRM.

Strengths

Customer referral In our reference checks, Capgemini had high scores related to customer

loyalty, reflected in references' potential to rehire as well as willingness to recommend the firm

to a friend or colleague. References also cited prior experience with Capgemini as a reason for

rehiring.

Industry focus Reference checks cited Capgemini consultants' competencies, industry

experience and project teams as a leading reason for selection. This strength is specific to



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CRM-technology-based solutions for the industry. The largest proportion of Capgemini's CRM

focus, staffing and project experience in 2012 continued to be in the public sector (the U.K. and

France), banking and insurance, telecommunications, utilities, discrete manufacturing

(particularly in Germany), and retail.

Technical competenciesCapgemini has more than 6,000 CRM consultants, and most ofthese are trained on SAP, Oracle, salesforce.com or Microsoft CRM. Capgemini has large

practices related to each CRM platform and experience with how these platforms are applied

within selected industries.

Integrated delivery model Capgemini's delivery model is a competitive differentiator in the

U.S., the U.K. and the Netherlands, with use of its Indian offshore delivery capabilities, but it is

less differentiating in France and Germany, which uses local delivery almost exclusively.

Cautions

Price The most commonly reason cited by references from other providers who evaluatedbut did not select Capgemini was its high price points. Capgemini appears to be one of the

highest-priced providers, but it also received exceptional scores for value delivered.

Business understanding during bid process The second most common reason was poor

communication of understanding of business needs. Capgemini approaches the market from an

industry solution perspective. For example, it has invested in an All-Channel Experience

solution, focused on retail and insurance. Capgemini's bids may not align with client

requirements in instances where it is not a focused vertical industry of Capgemini, or instances

where the client is looking for non-industry-specific technology support.

Limited geographic coverage Capgemini's CRM practice does 55% of its work in Europe

and generates 38% of revenue in North America, with the strongest presence in France and theU.K. This concentration in Europe is higher than the other Leaders'. Capgemini has a limited

presence in Asia/Pacific and only a minor presence in Latin America relative to other Leaders in

this Magic Quadrant assessment.

Cognizant

Cognizant is again positioned in the Leaders quadrant. Cognizant is a good fit for organizations

seeking strong technical implementation skills, particularly within selected industries (such as

pharmaceuticals, insurance and banking, healthcare in the U.S., and communications in Europe).

Gartner estimates that Cognizant is the sixth largest CRM service provider worldwide, with total

CRM revenue of about $675 million, with about $580 million from CRM consulting andimplementation services. Cognizant has very large practices in Siebel, salesforce.com and

Pegasystems, with additional competencies in SAP CRM and Microsoft Dynamics CRM.

Strengths

GrowthCognizant continues to grow its CRM service above the industry average; it saw

22% growth in 2012 versus industry growth of 11%. This is one of the highest growth levels of



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all providers in this assessment but somewhat lower than Cognizant's CRM practice growth in

prior years.

Value for priceCognizant had high ratings for overall value in this CRM study, even though

the price of services was considered to be slightly above average in comparison with direct

competitors.

Customer loyaltyReferences gave Cognizant very high scores for several loyalty-related

factors, including willingness to rehire, willingness to refer peers and meeting delivery

expectations. This is consistent with Cognizant's history as a solid technology implementation

partner with high levels of repeat business.

Global delivery balance Cognizant makes extensive use of offshore capabilities in India for

all implementation projects to drive cost competitiveness, but for CRM services, it also does a

good job of balancing these with local resources. Reference customers said that Cognizant

delivered 53% of the workload via offshoring (the second highest of the providers), 36% on-

site, and 11% off-site but in the same country or nearshore. It is estimated that about 75% of

Cognizant's total CRM-focused resources are from global delivery centers.

Cautions

Business consulting skillsCognizant has increased its business and CRM consulting

capabilities, but with limited scale. Cognizant continues to execute largely from a CRM-

technology-centric perspective. Only 3% of references said that the project mix was more than

50% business strategy or process redesign, compared with technology or software

implementation. This compares with an average of 23% for all vendors.

Domain expertise and industry experience According to references from other providers

who evaluated but did not select Cognizant, the most common reasons Cognizant lostcompetitive bids in 2012 were poor responses to RFPs and high price. This finding, coupled

with a low score on industry and process experience, suggests that, while Cognizant's stated

strategic direction is clearly on vertical solutions and consultative approaches, its current

strength lies in implementation of CRM technical solutions within selected verticals.

Geographic coverage Eighty percent of Cognizant's revenue is generated within the U.S.,

and less than 3% is generated in Asia/Pacific and Latin America. Cognizant continues to have

fewer local resources outside the U.S., the U.K. and Switzerland than other service providers.

Although Cognizant has a focused investment strategy to expand geographically and has local

CRM resources in most European countries, including France, Germany, Spain, Italy, Belgium

and the Nordics, it has fewer resources and revenue than do market leaders in continentalEurope and far less in the rest of the world.

CSC

CSC is positioned in the Visionaries quadrant. CSC focuses on "customer intimacy" solutions that

are industry-oriented and that integrate processes, technology and change management for large

enterprises. CSC is a good fit for enterprises seeking business-led CRM capabilities in banking,

insurance, automotive, government, travel/hospitality, healthcare and retail industries, with a



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particular strength in industry-specific innovation. Gartner estimates that CSC is the 14th largest

CRM service provider worldwide, with CRM revenue estimated to be about $135 million. CSC has

significant practices in Siebel, salesforce.com and SAP CRM, with additional capabilities in

Microsoft Dynamics CRM.

Strengths

ImpactClient references said CSC has above-average business value for CRM services,

such as enhancing campaign response and revenue from cross-sales. These findings, when

combined with CSC's relatively smaller CRM practice, support CSC's strategy to focus on

business-led CRM solutions to deliver demonstrable value.

Market focus CSC approaches CRM services within selected industries as an extension of

consulting transformations that encompass business consulting, emerging technologies

(mobility, customer analytics, social, software as a service [SaaS]) e-commerce and customer

experience. CSC combines business transformation and technology skills to address customer

experience issues within selected industries.

Global scope Although having a smaller CRM practice than its market competitors, CSC

generates significant revenue from all geographies. It has the ability to support large

multinational clients and delivery with consistent execution globally.

Cautions

GrowthCSC's CRM revenue has been growing slowly compared with competitors, at 1% to

3% in 2012, substantially below the market rate of 11%, even though CSC's CRM services

have grown faster than its overall application services, which have seen very flat growth.

Global delivery CSC makes limited use of offshore resources for CRM. Customer referencessaid that 74% of work was done on-site, 16% off-site but in the same country, and less than

10% utilizing nearshore and/or offshore resources. This reflects CSC's consultative approach to

CRM as a business-centric solution in most instances, rather than driven by large-scale

technology integration and deployment. If offshore delivery and price comparison are high

priorities, CSC may not be a good fit for large technology-centric implementations.

Organizational transformationCSC is a company in a turnaround mode; with a new focus,

direction and executive team in place, there is the expected associated challenges of retaining

key resources, and uncertainty in its ability to really transform into a globally integrated,

industry-aligned, geographically consistent practice. CSC has just transformed the former CRM

practice into a global social and CRM competency group. This competency center must learnto interoperate with other CRM software teams (salesforce.com, Oracle, SAP, Microsoft) to be

effective, and during this transition, the focus on CRM services may be limited and inconsistent

across accounts and business units.



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Deloitte

Deloitte is positioned in the Leaders quadrant. Deloitte is a good fit for enterprises that seek

business-consulting-led comprehensive or complex CRM solutions. This is particularly true when

the business is looking for innovative customer experience solutions to bring competitive

differentiation. Gartner estimates that Deloitte is the third largest CRM service provider worldwide,with CRM revenue estimated to be about $1.7 billion (accounting for 17% of its consulting and

implementation revenue). Deloitte has very large practices in Siebel, salesforce.com and SAP CRM.

Strengths

Vision and CRM leadershipDeloitte approaches CRM services as part of business

transformation and customer experience enrichment. Deloitte brings together a full set of

capabilities that include strategy, business process consulting, technology, digital design (via

Deloitte Digital) and analytics often focused on transforming the front office of customers.

Customer references rated Deloitte among the highest for CRM vision and overall thought

leadership.

GrowthDeloitte outgrew its largest competitors in 2012 in terms of total CRM-related

revenue, with a growth rate of about 14%, which is higher than the overall industry and

significant for the size and maturity of the practice.

Customer satisfaction and peer recommendation References gave Deloitte the highest

ratings for the likelihood of a client rehiring the firm, and among the highest for overall customer

satisfaction and recommending the firm to a friend or colleague. Deloitte also had very high

scores in delivery execution and meeting all expectations.

Industries Deloitte approaches the CRM market through a vertical go-to-market model that

leverages globally deployed CRM practitioners. In Europe, Deloitte's CRM vertical focus is ontelecommunications, technology, banking, insurance, utilities and the public sector. In North

America, the focus is on discrete manufacturing, process manufacturing, banking, insurance

and healthcare.

Cautions

Price According to references from other providers who evaluated but did not select

Deloitte, high price was the primary reason Deloitte was rejected by buyers. When the

competition was offshore providers, Deloitte typically lost on price, but price was also a factor

for Deloitte in losses to other global providers.

Understanding client needsThe most common reason Deloitte lost competitive bids in

2012 was that it did not demonstrate an understanding of the client's needs within the bid

process. Deloitte approaches most issues from a complex business consulting perspective, and

some clients may evaluate the Deloitte scope for complex business transformation to be

broader than requested.

Microsoft partnership Deloitte's clients and prospects may find barriers to working with the

firm when there is an existing audit relationship. Governmental bodies and regulators for

independence policies mandate restrictions on the consulting services that the audit/attest



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industry can provide to the same client. For example, Deloitte has a growing Microsoft

Dynamics practice, but the audit relationship with Microsoft limits Deloitte's participation in

certain go-to-market programs.

HCL TechnologiesHCL Technologies (HCL) is positioned in the Niche Players quadrant. HCL leverages skills from the

acquisition of HCL Axon as part of its practice and is a good choice for CRM implementation

services, particularly for SAP CRM solutions, marketing and customer service, and within selected

industries (life sciences, utilities, retail and consumer, medical devices, and travel and

transportation). Gartner estimates HCL's total CRM revenue to be about $170 million, but only

about $130 million is from CRM consulting and implementation services. HCL has a very large

practice in SAP CRM and significant practices in all other platforms (Siebel, Oracle Fusion,

salesforce.com and Microsoft Dynamics CRM).

Strengths

Industries solutions HCL goes to market by industry and focuses heavily on selected

industry segments (life sciences, high technology, utilities, retail and consumer products). HCL

has developed industry-specific solutions (for life sciences, medical devices, utilities, and travel

and transportation). For example, in life sciences, HCL has developed an Oracle-based solution

for pharmaceutical sales and e-detailing.

Platform-based technology practices HCL has developed deep partnerships with the four

major CRM software providers and invested in solutions around all these. More than 50% of

HCL CRM revenue is generated related to SAP solutions, with significant investment in SAP-

specific accelerators and solutions. HCL has also focused on Oracle Fusion and additional

Oracle Edge Solutions (such as RightNow, InQuira and Endeca), as well as on salesforce.comand Microsoft Dynamics CRM accelerators and templates.

Business benefit realization HCL has effectively embedded its formal benefits realization

methodology into implementation projects (called the Value Management Framework). HCL

works with clients to define solutions with tangible business benefits, enabled through a

comprehensive set of processes. These processes include identifying business benefits and

converting these benefits into quantifiable financial gains, as well as ensuring decisions made

during implementation are aligned with business benefits identified. This is particularly tied to

SAP CRM. HCL is also flexible and willing to assume risk-based contracts through tying a

portion of its fees to the realization of identified benefits using this approach.

Cautions

Customer satisfaction and willingness to recommend Within this assessment of the

largest CRM providers worldwide, HCL's scores were lower than average from references

related to several aspects of custom satisfaction. This included overall value and willingness to

recommend to peers.



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Project execution HCL had relatively low scores from references in meeting overall

expectations and project management. The two most common reasons that HCL lost

competitive bids were that the team members put forth did not meet expectations and

responses to RFPs were poor.

CRM vision and business consulting Despite its industry-specific focus, HCL scoredrelatively low for many consulting-related aspects of CRM projects. This included overall CRM

vision, industry expertise, business acumen and user change management. HCL appears to

have delivered CRM technology implementations well, especially for SAP, but has inconsistent

business consulting and CRM transformational capabilities.

IBM GBS

IBM Global Business Services (GBS) remains positioned in the Leaders quadrant. IBM GBS is a

good fit for enterprises seeking help with large, complex CRM initiatives that combine both

business consulting and technology innovation. This is especially true for enterprises looking to

transform their business to enable an improved approach to interactions with customers, partnersand suppliers, as well as when the requirements span multiple geographies. IBM is among the two

largest providers of CRM services, with global revenue for CRM-related implementations defined by

the scope of this assessment estimated to be between $2.0 billion and $2.2 billion (11% of overall

IBM GBS revenue) in 2012. IBM has very large practices in Siebel, SAP CRM and salesforce.com

and also focuses on services surrounding IBM CRM software.

Strengths

Vision and CRM leadershipCustomer references rated IBM among the leaders for CRM

vision, overall thought leadership and expertise in CRM marketing-related services. IBM has a

vision of CRM that is an extension of its corporate strategies related to the Smarter Planet andSmarter Commerce initiatives. It informs that vision with research from the IBM Institute for

Business Value. IBM seeks to bring together new approaches to heighten customer

engagement that integrate commerce, analytics and social/mobile interactions to design a

"digital front office" for customer interactions.

Integrated services and softwareIBM has invested in analytics and marketing software,

processes and services, and this is particularly deep with CRM. It has made more than $3

billion in investments in CRM-related software acquisitions, including SPSS, Unica,

Coremetrics, Tealeaf, Varicent, Vivisimo and Cast Iron. IBM has worked to integrate these

assets into its CRM analytics capabilities, as well as part of its CRM marketing services.

References also rated IBM very high in consulting competencies, including business acumen,industry understanding, business value and change management. This coupling of software

solution sets with extensive consulting competencies is compelling to many references.

CRM analyticsIBM's CRM services are aligned with corporate initiatives that include

Smarter Planet, Smarter Commerce, SmartCloud, analytics and IBM MobileFirst. IBM stands

out in its CRM analytic capabilities that are at the intersection of BI software, CRM software and

CRM analytic services. IBM also views Smarter Commerce and CRM to be highly linked and

integrated from both a solution and service perspective.



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Customer satisfaction with executionIBM references ranked IBM as quite high in overall

customer satisfaction and among the highest in several domains related to execution, including

project management, meeting expectations, technical skills, digital design and architectural

skills.

Cautions

Price and business understanding According to Gartner reference checks who evaluated

but did not select IBM, the two most common reasons IBM loses competitive bids were

because of the premium price of its services and secondarily because IBM consultants did not

demonstrate an understanding of the client's business needs during the bid process. IBM

approaches the market from a complex CRM and solution perspective, and it is likely that some

clients might interpret IBM's approach as not understanding their business needs. It is likely

that customers looking for a predefined technology approach or who need only limited vertical

expertise might look to other providers with lower price points.

Overall valueAlthough IBM scored very high in customer satisfaction and execution,references were not overly enthusiastic related to rehiring or referring IBM to peers. IBM also

scored relatively low in overall value. These findings suggest that the highly effective project

execution for large business-critical projects is IBM's forte, but due to the cost and size of these

efforts, the desire to rehire IBM and/or refer it to peers may be reserved for selected large or

complex initiatives.

Infosys

Infosys is positioned in the Challengers quadrant. Infosys is a good fit for enterprises that have a

need for good value for price and/or multicountry technology-led CRM solution implementations.

Gartner estimates that Infosys is the seventh largest CRM service provider worldwide, withestimated total CRM revenue of about $740 million, with about $570 million from CRM consulting

and implementation services. This represents 12% growth in 2012, which is around the overall CRM

market and considerably higher than overall Infosys revenue growth. Infosys has a very large

practice in Siebel and significant practices in all other platforms (SAP CRM, Oracle Fusion,

salesforce.com and Microsoft Dynamics CRM).

Strengths

Project execution and technical skillsInfosys scored among the highest in project

management, time quoted to completion and meeting all expectations. Infosys was also above

average for skills in technical architecture and system integration competencies.

Balanced global delivery and scale Infosys has one of the largest CRM practices in terms

of resources, with more than 7,000 CRM practitioners globally. Infosys makes good use of

offshore capabilities in India on all CRM implementation projects. Reference customers said

that Infosys delivers 35% of the workload offshore, 2% nearshore, 12% off-site but in the same

country, and 51% on-site, giving it a good balance of work globally, with scalability and

leveragability of key technical staff and a mix very similar to the market leaders'.



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CRM vision and business consulting Infosys scored very well on overall CRM vision by

references. References also rated Infosys highly in functional business skills, as well as

architectural skills. Infosys has organized by vertical sector: In Europe, the greatest proportion

of Infosys' CRM resource skills and project experience is heavily focused on

telecommunications, consumer goods, retail and utilities, while in North America, the focus is

prevalently on automotive, high technology, financial services, consumer packaged goods and

retail. Infosys also scored well on business consulting, change management and business

process design.

Customer satisfactionInfosys was rated among the highest in multiple aspects related to

customer satisfaction, including overall customer satisfaction, overall value and willingness of

customer references to rehire. This is a significant improvement from past years and reflects

more consistent execution and business value.

Cautions

Understanding the business and platform According to some references from otherproviders who evaluated but did not select Infosys, the two most common reasons that Infosys

lost competitive bids in 2012 were their proposal did not demonstrate an understanding of the

business problems and at times it did not have an established practice focused on a particular

software platform.

Geographic coverage Infosys generates most of its work in the U.S., the U.K., Australia,

Switzerland and Norway. The company still has a few gaps in emerging markets, such as Latin

America, Eastern Europe and Africa, compared with the market leaders. In Europe, Infosys has

a limited local presence of CRM resources in 10 other European countries, notably in France,

Sweden and Finland, and limited teams in China and Japan. The recent Lodestone acquisition

will help expand Infosys' presence in some of these markets. Price Although Infosys is rated very high in overall value, some references cited higher than

expected prices, and some competitive losses were due to high price points. This may be due

to an increased focus on business and consultative-led CRM services, as well as being

positioned as a competitive alternative to traditional global providers and losing deals to

offshore-centric competitors based on price.

NTT Data

NTT Data is a Challenger on the 2013 Magic Quadrant. NTT Data has grown rapidly from the

acquisition of multiple firms and is rapidly integrating these into a global application service

provider. NTT Data is a good fit for enterprises that require CRM solutions that have complex

business and technical requirements, particularly related to customer service and in selected

industries. Gartner estimates that NTT Data is the fourth largest CRM service provider worldwide,

with CRM implementation revenue estimated to be about $1.1 billion, due largely to a strong

presence in Japan. NTT Data has large practices in Siebel and salesforce.com, and it also has

competencies in SAP CRM and Microsoft Dynamics CRM.



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Strengths

IndustriesNTT Data approaches CRM services from a business and vertical solution

perspective, with a focus on discrete manufacturing, automotive, telecommunications,

insurance and banking. In Japan, NTT Data has an additional focus on the public sector and

banking. In North America, its focus has been on discrete manufacturing and retail.

Project team and cultural fitNTT Data customer references gave high ratings in cultural fit,

as well as in the quality of project team members and their specific geographic capabilities.

Focused solutionsNTT Data has invested in selected solutions within each geography that

resonate with the local market. In the U.S., the focus is on salesforce.com and Microsoft

Dynamics CRM for manufacturing, consumer products, financial services and the public sector.

In Europe, the focus is on Siebel, SAP CRM, Microsoft Dynamics CRM and salesforce.com,

with additional solutions for customer service and customer loyalty for automotive, retail,

insurance, telecommunications and banking. In Japan, the focus is on customer service centers

for telecommunications, automotive, banking and the public sector.

Cautions

Awareness NTT Data is the aggregation of multiple acquisitions over the past several years,

including Cirquent, Keane, The Revere Group, Value Team and Intelligroup, which have been

integrated into the NTT Data brand, while Centerstance remains a separate brand working with

NTT Data across regions. NTT Data is well-known in Japan but less visible in other regions. This

limited market awareness of NTT Data overall and its CRM services in particular, has limited the

number of opportunities that NTT Data is invited to participate in, despite excellent capabilities.

As NTT Data continues to acquire small consulting firms that have geographic and/or domain

specialization, it will be critical that an overall NTT Data brand emerges and becomes moreprevalent.

Global delivery NTT Data lags its competitors in its use of global delivery. It utilizes

nearshore centers heavily for North America (Halifax) and Europe (rural Italy and Romania).

Although it has significant delivery centers in India and China, there is a relatively small use of

offshore centers to support U.S. and Japanese clients. This may be a competitive disadvantage

for CRM implementations that require price-sensitive technology efforts.

Geographic coverage NTT Data is now a global provider, but due the acquisitions,

coverage is inconsistent. Seventy-eight percent of all CRM revenue is derived in Asia and

mostly in Japan, and in terms of telecommunications, largely in conjunction with NTT Group

entities. Nineteen percent of revenue is generated in Europe, largely from Germany,Switzerland, Austria, Italy and the U.K. Only 3% of revenue is generated in the Americas. It is

expected that its North American revenue will increase rapidly as more recent NTT acquisitions

(Centerstance, for example) are integrated into the global NTT Data practice.



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PwC

PwC is positioned in the Leaders quadrant for the first time. PwC has a focus on business

transformation enabled by technology in general and CRM in particular. The CRM focus has had a

significant impact on customers and has become a hallmark of PwC's CRM competitive

differentiation the past few years. PwC is a good fit for enterprises seeking business-consulting-ledcomplex solutions in specific industries and geographies. Gartner estimates that PwC is the eighth

largest CRM service provider worldwide, with CRM revenue estimated to be about $330 million.

PwC has a large practice in Microsoft Dynamics CRM and also has competencies in

salesforce.com, SAP CRM and Siebel.

Strengths

GrowthGartner estimates that PwC's CRM solution implementation service growth is well

above the market growth rate and was more than 40% from 2011 through 2012, making it the

highest-organic-growth provider, fueled only in part by acquisitions (such as Ant's Eye View).

Business and consulting skillsPwC was rated very high by references in CRM

competencies related to business and CRM technology, including industry expertise, business

consulting, change management, project management, knowledge transfer, technical skills and

architectural skills. PwC has the one of the highest percentages of revenue derived from CRM

consulting services compared with all providers profiled here.

Customer satisfaction Customers rated PwC among the highest in customer satisfaction,

and as well as in their willingness to recommend PwC to peers. PwC also received among the

highest scores for value in terms of both cost to return and realized business benefits.

Industries The greatest proportion of PwC's resource skills and project experience is in

insurance, banking, business services, utilities, discrete manufacturing, healthcare,telecommunications, hospitality and travel.

Cautions

Team members and poor RFPs According to references from other providers who

evaluated but did not select PwC, the two most common reasons that PwC lost competitive

bids in 2012 were that the proposed team members put forth did not meet expectations and

that the responses to RFPs were poor. These reasons were cited as especially acute when the

customer focus was on CRM-technology-centric deployments rather than on business

transformation.

Breadth and depth Enterprises that need specific CRM business or technology skills may

find their needs met; however, those seeking both advisory and implementation capabilities

across a wide range of technologies (such as mainframe, legacy client server or custom

solutions) will need to carefully assess whether PwC has the necessary talent for all technology

domains.

Geographic coverage PwC's CRM coverage is strong within the U.S., the U.K. and

Germany. Its CRM coverage in Asia/Pacific is focused on Japan and Australia. Beyond that,

PwC's CRM coverage is limited in other countries, such as France, Spain, Italy, China and the



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Nordics, and in regions such as Latin America and the Middle East when compared with other

Leaders in this Magic Quadrant.

Tata Consultancy Services

Tata Consultancy Services (TCS) is positioned in the Challengers quadrant. TCS is a good fit for

enterprises seeking multicountry and technology-heavy CRM projects, particularly for Siebel and

salesforce.com. Gartner estimates that TCS is the ninth largest CRM service provider worldwide,

with total CRM revenue of about $370 million, with about $240 million from CRM consulting and

implementation services. TCS has a very large Siebel practice and significant practices in

salesforce.com, SAP CRM, Pegasystems and Microsoft Dynamics CRM.

Strengths

GrowthGartner estimates that TCS's CRM service growth was significantly higher than the

market's in 2012, with a growth rate of about 18%.

Customer satisfactionand value TCS had above-average feedback from references related

to several aspects, including overall customer satisfaction, meeting project expectations,

willingness to rehire and propensity to refer to peers. References also rated TCS the highest in

terms of overall value for investment and also in total cost of services. This corresponds to a

pattern of a high level of revenue generation from existing accounts.

Global delivery and coverage TCS utilizes a good blend of onshore and offshore resources

for CRM services. TCS reference customers said that TCS utilized on-site resources for 39% of

its efforts, off-site in-country and nearshore for 19%, and offshore delivery for 43%, which is a

shift from the past and more aligned with complex CRM solutions. TCS also has a good mix of

revenue from North America (54%), Europe (38%) and Asia/Pacific (8%), which is similar to themarket leaders.

Industries TCS focuses on a few key industries, with the greatest portion of its CRM

resource skills and project experience in North America being in banking, insurance, healthcare,

discrete manufacturing and telecommunications. In Europe, TCS's CRM services are focused

mostly on telecommunications and retail. TCS has invested with software partners (Oracle and

SAP) into CRM solutions for specific vertical segments, such as automotive, airlines and retail.

Cautions

Understanding the business and RFP responsesAccording to some references from other

providers who evaluated but did not select TCS, the three most common reasons that TCS lostcompetitive bids was that the team members being proposed did not meet requirements, their

proposals did not demonstrate an understanding of the client's business requirements during

the bid process, and the RFP response was poor.

Cultural fitTCS was rated by its reference customers as relatively low in cultural fit in both

North America and Europe. TCS is addressing this through building local practices through both

increased hiring and acquisitions in Europe and North America.



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Business consultingWhile TCS aims for more business roles, clients continue to perceive

the company as being more technology-focused. Only 10% of references said that the project

mix was more than 50% business strategy or process redesign, compared with technology or

software implementation. This compares with an average of 22% for all vendors. TCS was also

rated lower than most other providers in business acumen, business process skills, change

management and CRM strategy.

Tech Mahindra

Tech Mahindra is positioned as a Niche provider in the 2013 CRM Magic Quadrant. It is the first

time it has been included in the assessment. Tech Mahindra recently completed the integration with

Mahindra Satyam, and the two now go to market as a single entity. Tech Mahindra is a good fit for

enterprises seeking CRM technology implementation skills for major CRM platforms, especially in

the telecommunications and automotive industries. Gartner estimates that Tech Mahindra is the

13th largest CRM service provider worldwide, with total CRM revenue of about $160 million, with

only about $125 million from CRM consulting and implementation services. Tech Mahindra has

large practices focused on portals and Siebel, as well as competencies in salesforce.com,

Pegasystems, Microsoft Dynamics CRM and SAP CRM.

Strengths

Customer satisfactionTech Mahindra received positive ratings from references related to

overall satisfaction, meeting project expectations, and willingness to rehire as well as support

through implementation.

Geographic coverageTech Mahindra generates significant revenue from three regions

(North America, EMEA and Asia/Pacific) in a manner that is similar to the overall market, which

in unique for India-centric providers. It is particularly adept in the emerging regions of theMiddle East, Africa and India.

Industry-specific solutions Tech Mahindra has invested in CRM solutions and intellectual

property for selected industries and platforms. For telecommunications, this includes order

management and retail order fallout; for automotive, this includes warranty management and

dealer management; and for retail, this includes multichannel analytics. Tech Mahindra has also

developed solutions for horizontal solutions, with examples including an e-commerce jump-

start, Web/portal channel management and contact center modernization. Tech Mahindra has

also invested in horizontal SAP Rapid Deployment Solutions specific to CRM.

Cautions

Business and industry consulting References for Tech Mahindra consistently scored it low

in consulting-related competencies, including business acumen, industry expertise, change

management and business process consulting relative to market leaders. Its scores for CRM

strategy and CRM thought leadership also need to improve.



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Cultural fitTech Mahindra was rated by its reference customers as relatively low in cultural

fit in both North America and Europe compared with reference customers of other service

providers.

Scale Tech Mahindra has focused practices in all the major platforms, but only the

Pegasystems and Siebel practices are large enough to scale to the demand of multipleengagements for large new implementations. For other technologies, Tech Mahindra can

provide a small number of excellent technicians who are appropriate for smaller engagements

requiring only a few on-site technology specialists. This is particularly true when consulting and

change management is required on large multiregion engagements. Tech Mahindra is well-

suited for technically complex implementations that pull together networks and technology

solutions.

Wipro

Wipro is positioned in the Niche Players quadrant. Wipro is a good fit for enterprises seeking strong

CRM technology implementation skills for the major CRM platforms (Siebel, SAP, salesforce.comand Microsoft Dynamics). Gartner estimates that Wipro is the 10th largest CRM service provider

worldwide, with total CRM revenue of about $270 million, of which about $200 million is from CRM

consulting and implementation services. Wipro has a very large Siebel practice and significant

practices in salesforce.com, SAP CRM, Pegasystems and Microsoft Dynamics CRM.

Strengths

Total cost of servicesCustomer references rated Wipro as high in managing project costs

as well as in delivering within time and initial budget.

Balanced global delivery Wipro utilizes solid offshore-centric teams that have been veryeffective and efficient in complementing on-site teams. Wipro has a good mix of revenue from

North America (58%), Europe (30%) and Asia/Pacific (10%), with 1% generated in Latin

America. Wipro also utilizes a good blend of onshore and offshore resources for CRM services

on most implementation projects. Wipro's staffing profile has about 33% of CRM consultants

in-region and 66% offshore. However, a small set of Wipro reference customers said that Wipro

utilized on-site and off-site in-country resources for 70% of efforts and 30% for offshore

delivery. This suggests that Wipro adapts its staffing mix to projects and can execute in a

flexible manner.

Industries Wipro's greatest portion of CRM resource skills and project experience in North

America is in discrete manufacturing, banking and insurance, retail, and telecommunications. In

Europe, its skills are focused in the same industries but with an additional focus on utilities.

Cautions

Customer satisfactionIn our reference checks, Wipro had one of the lower overall

customer satisfaction ratings compared with reference customers of others in this Magic

Quadrant; references' willingness to provide referrals to peers was also relatively low.



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Understanding the business and RFP responses According to Gartner reference checks,

the two most common reasons that Wipro lost competitive bids in 2012 were that it did not

demonstrate an understanding of the business during the bid process and it had poor RFP

responses.

Geographic coverage Wipro's CRM local resource coverage is limited outside the U.S., theU.K., France, Germany, Australia and Saudi Arabia. Approximately 60% of revenue is from

North America. The company is still relatively weak in Spain, Italy, Belgium, Denmark, Austria,

Norway, China and South Korea compared with the market leaders.

Business consulting References gave Wipro relatively low scores for business acumen and

business process consulting. According to Gartner reference checks who evaluated but did not

select Wipro, the most common reasons Wipro lost competitive bids were lack of process

depth/expertise and its proposed team members' not fitting expectations.

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets

change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or

MarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope one

year and not the next does not necessarily indicate that we have changed our opinion of that

vendor. This may be a reflection of a change in the market and, therefore, changed evaluation

criteria, or a change of focus by a vendor.

Added

We added HCL Technologies and Tech Mahindra to the 2013 CRM Services Magic Quadrant.

Dropped

The 2013 CRM Services Magic Quadrant has shifted to a global focus, while in past years it focused

only on North America and Western Europe. The qualification criteria changed this year to require

revenue generation from at least three regions (including Japan-Asia/Pacific or Latin America). All

providers except one were retained; the one that did not fit this requirement was Logica (now part of

CGI).

Inclusion and Exclusion CriteriaThe scope of this document is worldwide. Approximately 50% of all CRM consulting and

implementation work is done in North America and a further 35% in Europe, but this Magic

Quadrant also looks at the abilities of the market participants in all geographies.

The services being evaluated include CRM strategy development, business case creation, CRM

solution architectures and designs, deployment of CRM solutions (from software vendors including

Oracle, SAP, salesforce.com and Microsoft but also a further 400 other vendors see "The Gartner



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CRM Vendor Guide, 2013" for a more complete list), CRM software development and integration,

CRM analytics, program and project management, and deployment and change management.

Gartner's Magic Quadrant research process involves primary research, with direct client references

supplied by the various CRM service providers and each service provider's representation of its

organization. The analysis involves weighting both sources of information, with a heavy emphasison client feedback. As a result, many individual categories have "client reference" criteria factored

into the scoring. Gartner considers client feedback to be one of the most-critical measures of a

service provider's success.

Gartner evaluates service providers on their Ability to Execute and their Completeness of Vision.

When the two sets of criteria are evaluated together, the resulting analysis provides a view of how

well the provider performs a spectrum of services compared with its peers and how well it is

positioned for the future. This evaluation is a snapshot in time. The competitive nature of the CRM

service provider market over time affects the relative position of evaluated companies. In addition to

understanding positions in this Magic Quadrant, enterprises must conduct due diligence and check

references. Enterprises also should ensure that their business culture is synergistic or, at aminimum, compatible with the service provider's culture. The most-critical criteria for project

success are a provider's ability to work within an enterprise's business culture, and a provider's

ability to work with an enterprise's people to effect the organizational change essential to a

successful CRM program. This is more critical now for CRM services than ever due to the

transformational nature of CRM deployments and the impact of enterprises changing how they

interact internally and with customers and partners.

A broad group of providers offers CRM services. Magic Quadrants do not include all vendors in a

given sector. Many service providers focus only on parts of the overall solution. Companies

considered for evaluation in this Magic Quadrant research are those that act as advisors and

provide implementation services that encompass most or all levels of a solution, as outlined above.Further, providers also were evaluated in more detail using a combination of quantitative and

qualitative criteria. Note that vendors assuming they meet the inclusion criteria cannot elect to

be excluded from a Magic Quadrant.

Quantitative Criteria for This Magic Quadrant

Service providers that demonstrated CRM solution implementation service revenue derived

from clients across multiple geographic regions.

A minimum of $125 million (in U.S. dollars) for 2012 in CRM service revenue (excluding value-

added reseller revenue, outsourcing and application management service revenue, and

software maintenance and support fees). Revenue generation must come from at least three

regions, including North America, Latin America, EMEA and Asia/Pacific (including Japan and

Australasia).



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Qualitative Criteria for This Magic Quadrant

This Magic Quadrant focuses on CRM-project-based services that include consulting and solution

implementation services worldwide (note that this research excludes managed services and

outsourcing). The defining factor in this Magic Quadrant evaluation is that the service provider

demonstrates the ability to implement solutions in large enterprises that are focused on enhancingCRM and customer experiences. CRM solutions increasingly require a broad set of business,

consulting, technical and management disciplines that must be brought together seamlessly.

We evaluate the set of offerings for CRM programs that include the ability to provide:

Advisory and consulting services on CRM solution decisions

Insight across industries for CRM solution decisions

Consulting services for CRM architecture and design (technology) environments

A comprehensive set of system integration and implementation services across the CRMproducts and technologies (both on-premises and SaaS-based)

Multiple business and technical domains into CRM solutions, including but not limited to

business consulting, social CRM, mobility and digital, customer information and analytics,

master data management, and workflow and business process management

Based on these requirements, this analysis heavily weighted the ability of a service provider to bring

a multidisciplinary approach to CRM business issues and consistently craft and deploy holistic

solutions. Not to be overlooked, technology functions still play an important role; however, as those

skills are closer to commoditization, we placed more weight to business-led, information-centric,

mobility, social and analytic capabilities.

Provider evaluation was based on:

Gartner analysts' interactions with enterprises, which reveal interest in specific CRM service

providers

Vendor demonstration of depth and breadth of CRM service capabilities

The service provider's current and potential market impact, as measured by frequency of

appearance on shortlists

Ability to provide consulting and solution implementation services (including program and

project management) across multiple CRM software platforms (such as Oracle, SAP,

salesforce.com and Microsoft)

References from customers who completed surveys related to the provider's vision,

competencies and outcomes on recent CRM engagements

Many service providers focus only on parts of the overall solution. The companies evaluated in this

research act as advisors and provide implementation services that encompass most or all levels of

a CRM solution, and the vendors were then evaluated in more detail using a combination of

quantitative and qualitative criteria, as outlined earlier.



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Evaluation Criteria

Ability to Execute

Gartner analysts evaluate service providers on the quality and efficacy of the processes, systems,methods or procedures that enable IT provider performance to be competitive, efficient and

effective, and to positively impact revenue, retention and reputation. Ultimately, service providers

are judged on their ability and success in capitalizing on their vision.

Product or Service:Core services offered by the provider that compete in/serve the CRM service

market. This includes current service offerings as defined in the market definition and expressed by

growth, capacity, market penetration, skills availability, breadth and depth of offering, and so forth.

Subcategories include:

Assessment of services in key CRM business skills for sales, marketing, e-commerce, cross-

CRM, and customer service and support

Analysis of technical knowledge and skills

Assessment of a provider's ability to develop services to meet emerging market needs

Overall Viability (Business Unit, Financial, Strategy, Organization): Includes an assessment of

the overall organization's financial health; the financial and practical success of the business unit;

and the likelihood of the individual business unit to continue to invest in the service, continue

offering the service, and advance the state of the art within the organization's portfolio of services.

Sales Execution/Pricing:The technology provider's capabilities in all presales activities and the

structure that supports them. This includes solution visualization, deal management, pricing and

negotiation, presales support, and the overall effectiveness of the sales channel.

Market Responsiveness and Track Record:Ability to respond and adapt to changing competitive

forces as opportunities develop, competitors act, customer needs evolve and market dynamics

change. This criterion also considers the provider's history of responsiveness and the ability to

quickly address changing requirements.

Customer Experience:This criterion considers:

Specific client feedback on the experience working with the CRM service provider

A demonstrated ability to deliver on key metrics that drive the overall "client experience" when

working with a CRM service provider

Operations:Ability of the organization to meet its goals and commitments. Factors include the

quality of the organizational structure, including skills, experiences, programs, systems and other

vehicles, that enable the organization to operate effectively and efficiently on an ongoing basis.

Subcategories include:

Organizational and business model



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Applied use of methodologies

Global delivery model capabilities

Table 1. Ability to Execute Evaluation Criteria

Criteria Weight

Product or Service High

Overall Viability Low

Sales Execution/Pricing Low

Market Responsiveness and Track Record High

Marketing Execution No Rating

Customer Experience High

Operations Medium


Completeness of Vision

Gartner analysts evaluate service providers on their ability to convincingly articulate logical

statements about current and future market direction, innovation, customer needs and competitive

forces and how well they map to the Gartner position. Ultimately, service providers are rated ontheir understanding of how market forces can be exploited to create opportunity for the provider.

Market Understanding:Ability of the provider to understand buyers' needs and translate these

needs into products and services. This includes both business and technology buyers across all

three CRM domains. Vendors that show the highest degree of vision listen to and understand

buyers' wants and needs, and they can shape or enhance those wants and needs with their added

vision. Subcategories include:

Service provider's knowledge and articulation of key market direction and trends

The analysis of the service provider's executive leadership (including thought leadership,

continuity, operational capabilities, and so forth)

Marketing Strategy:A clear CRM service marketing strategy with a differentiated set of messages

consistently communicated throughout the organization and externalized through appropriate

channels emphasizing differentiated positioning statements. This will clearly specify targeted

markets, solutions and differentiating characteristics.



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Sales Strategy:The strategy for selling CRM services that uses the appropriate network of direct

and indirect sales, partner networking, and alliance relationships that extend market reach to both

prospects and the customer base.

Offering (Product) Strategy:A technology provider's approach to solution development and

delivery that emphasizes differentiation, functionality, methodology and feature set as they map tocurrent and future requirements. Subcategories include:

Service provider's strategies for partnerships and alliances

Vision for creating new and/or additional CRM business

Integration of multiple domains (business and technical) into solution

Vertical/Industry Strategy:The technology provider's strategy to direct resources, skills and

offerings to meet the specific needs of individual market segments, including verticals.

Innovation:Direct, related, complementary and synergistic layouts of resources, expertise orcapital for investment, consolidation, defensive or pre-emptive purposes. Subcategories include:

Approach to customer experience design and development

Sustainable investment in proactive tools, methods and/or locations for CRM solution

development

CRM solution development that addresses vertical or process-specific instances and

integration of multiple competencies and disciplines

Geographic Strategy:The technology provider's strategy to direct resources, skills and offerings to

meet the specific needs of geographies outside the "home" or native geography, either directly or

through partners, channels and subsidiaries, as appropriate for that geography and market.



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Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Medium

Sales Strategy No Rating

Offering (Product) Strategy High

Business Model No Rating

Vertical/Industry Strategy Medium

Innovation High

Geographic Strategy Medium


Quadrant Descriptions

Leaders

Leaders are performing well today, gaining traction and mind share in the market; they have a clear

vision of market direction and are actively building competencies to sustain their leadership positionin the market.

Challengers

Challengers execute well today for the portfolio of work selected, but they have a less-defined view

of market direction. Consequently, these service providers may be the "up and comers" of the

future, or they may not be aggressive and proactive enough in preparing for the future.

Visionaries

Visionaries articulate important market trends and direction. However, they may not be in a positionto fully deliver and consistently execute. They may need to improve their optimization of service

delivery.

Niche Players

Niche Players focus on a particular segment of the market as defined by such characteristics as

functional area (that is, sales, marketing or service), vertical industry, client size or project



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complexity. Their ability to execute is limited to those focus areas and, therefore, is assessed

accordingly. Their ability to innovate may be affected by this narrow focus.

ContextThe Magic Quadrant for CRM service providers analyzes the market for CRM consulting and

solution implementation services. The relative positioning of vendors in this Magic Quadrant is

based on inclusion criteria and key criteria for evaluating the Ability to Execute and Completeness of

Vision. Consulting and solution implementation projects require a blend of business, industry,

technology, and project and program management skills that must align with your objectives,

institutional and business culture, and employees. Do not simply select service providers in the

Leaders quadrant. All selection processes are enterprise-specific; consequently, vendors in the

Challengers, Visionaries or Niche Players quadrants may prove to be more appropriate for your

requirements. Many smaller service providers not covered in this Magic Quadrant may be

appropriate for your needs on smaller or regional-specific projects.

Market Overview

What Happened?

Over the past 10 years, CRM-related services have focused on the strategy and deployment of

CRM software to support the sales, marketing operations and customer service operations of

enterprises. Services to plan, architect, customize, integrate and deploy these solutions were large,

time-consuming and expensive initiatives. Typically, the cost of consulting, implementation and

management services is three to six times the cost of the software licenses, and Gartner hasoccasionally observed projects being as large as 10 times the cost of software. In addition to the

services for initial deployment, there are also software maintenance fees (typically 16% to 22% of

license fee), as well as ongoing application management services, with costs of multiyear contracts

being similar to the initial deployment fees. Thus, the total service fees over the life of the software

have often been 10 to 15 times the initial license fees for the software. This investment has also had

limited flexibility due to the level of customization of the implemented solution, along with the

complexity of the business and technical environments.

Over the last few years, business executives have become the primary drivers for CRM solutions,

and they have become less tolerant of large-scale software implementations and are also looking to

CRM solutions to drive revenue growth, improve customer satisfaction or lower costs. There hasbeen a shift from the focus on large-scale CRM software deployments to a holistic view of the

customer from an enterprise perspective. This focus has shifted the consulting and system

integration efforts related to CRM from software deployment to how the information related to the

customers is integrated into the operational fabric of the enterprise.



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What's Happening?

CRM services is estimated to be a $34 billion market in 2013, with significant growth forecast for

enterprise CRM application services from 2010 through 2015, with a 7% compound annual growth

rate, which is significantly higher than most other application services (for more information, see

"Forecast Analysis: Application Solution Services, Worldwide, 2010-2015"). We estimate that thegrowth in 2012 was actually 11% based on the current analysis. During the past three years,

disruptive forces such as social CRM, big data, mobility and cloud computing have been

catalysts to force organizations to rearchitect their CRM strategy and integrate sales, customer

service and marketing components in a more holistic way that redefines front-office operations and

also integrates these with existing back-office processes and systems. This transition has shifted

from CRM technology centricity to a "customer experience" focus that integrates multiple domains

into key business operations, including e-commerce, analytics, business process design and

organizational change management. This also requires an increased emphasis on enterprise

architectures and information architectures that integrate CRM applications into business

operations and with other operational systems (that is, ERP, supply chain management and e-

commerce). The architectures and integration will be different for each vertical and each enterprise,so this shift also requires much more of a business-centric consultative approach, with some level

of vertical expertise, technology consulting, and design and system integration efforts, rather than

just stand-alone CRM software deployments. This shift encompasses data warehouse, analytics

and BI competencies to derive maximum usage of the CRM analytics as part of sales performance

improvements, customer service and enhanced marketing campaigns. Finally, since this transforms

front-office interactions between enterprises and their customers, e-commerce, self-service and

cross-CRM design is also now incorporated into many CRM initiatives.

SaaS-based CRM implementations now exceed on-premises solutions. Led by salesforce.com,

SaaS or cloud CRM now accounts for 14% of the CRM software market, and it is growing more

than 25% annually, which is more than twice the rate of on-premises CRM solutions (see "MarketShare: All Software Markets, Worldwide, 2012"). This rapid shift from large on-premises CRM to

SaaS is having a dramatic impact on application services. Service providers are faced with

maintaining the revenue streams from large on-premises CRM as the transition to new

multidimensional CRM solutions occurs. Therefore, while traditional on-premises CRM solutions will

still be the core for most CRM service providers, to compete effectively, providers must also offer

multidimensional solutions that involve SaaS, mobile, business process management, social CRM

and customer analytics that are integrated around CRM information. A more detailed discussion

and marketplace implications can be found in "Competitive Landscape: CRM Service Providers,

North America and Western Europe" and "Competitive Landscape: CRM Service Providers, Asia/

Pacific."

How to Use This Magic Quadrant

Selecting the right CRM service provider requires focused and deliberate evaluation. The market for

CRM services is maturing, but the ability to address complexity from business perspectives, as well

as achieve complex technology integration, will be highly differentiating for the next few years.

These factors have led providers to re-establish their CRM strategic focus, market strategies and

competitive aims, forcing new approaches to differentiation and, thus, leading to changes in

positions of providers included in the 2013 results.



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While positions are helpful to understand the relative strengths and weaknesses, this research

reflects providers whose focus on CRM produces scalable breadth and depth for this blend of

business and technology skills. Use this Magic Quadrant to help inform your thinking, recognizing,

however, that Leaders as indicated by position may not be the right fit for your business

simply because of that positioning. Gartner offers an array of IT sourcing life cycle research, insight,

tools and templates to assist your decision making for simple or complex project needs.

Recommended ReadingSome documents may not be available as part of your current Gartner subscription.

"How Gartner Evaluates Vendors and Markets in Magic Quadrants and MarketScopes"

"The Elusive CRM Magic Quadrant"

"Competitive Landscape: CRM Service Providers, North America and Western Europe"

"Competitive Landscape: CRM Service Providers, Asia/Pacific"

"The Gartner CRM Vendor Guide, 2013"

"CRM Applications Deployed by Consultancies in 2012 Show Which Skills Are Prevalent"

"The Eight Building Blocks of CRM: Overview"

"Magic Quadrant for Customer Management Contact Center BPO, Worldwide"

Evaluation Criteria Definitions

Ability to Execute

Product/Service: Core goods and services offered by the vendor for the defined

market. This includes current product/service capabilities, quality, feature sets, skills

and so on, whether offered natively or through OEM agreements/partnerships as

defined in the market definition and detailed in the subcriteria.

Overall Viability:Viability includes an assessment of the overall organization's financial

health, the financial and practical success of the business unit, and the likelihood that

the individual business unit will continue investing in the product, will continue offering

the product and will advance the state of the art within the organization's portfolio of

products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the

structure that supports them. This includes deal management, pricing and negotiation,

presales support, and the overall effectiveness of the sales channel.



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Market Responsiveness/Record:Ability to respond, change direction, be flexible and

achieve competitive success as opportunities develop, competitors act, customer

needs evolve and market dynamics change. This criterion also considers the vendor's

history of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designedto deliver the organization's message to influence the market, promote the brand and

business, increase awareness of the products, and establish a positive identification

with the product/brand and organization in the minds of buyers. This "mind share" can

be driven by a combination of publicity, promotional initiatives, thought leadership,

word of mouth and sales activities.

Customer Experience: Relationships, products and services/programs that enable

clients to be successful with the products evaluated. Specifically, this includes the ways

customers receive technical support or account support. This can also include ancillary

tools, customer support programs (and the quality thereof), availability of user groups,

service-level agreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factors

include the quality of the organizational structure, including skills, experiences,

programs, systems and other vehicles that enable the organization to operate

effectively and efficiently on an ongoing basis.

Completeness of Vision

Market Understanding:Ability of the vendor to understand buyers' wants and needs

and to translate those into products and services. Vendors that show the highest

degree of vision listen to and understand buyers' wants and needs, and can shape or

enhance those with their added vision.

Marketing Strategy:A clear, differentiated set of messages consistently

communicated throughout the organization and externalized through the website,

advertising, customer programs and positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of

direct and indirect sales, marketing, service, and communication affiliates that extend

the scope and depth of market reach, skills, expertise, technologies, services and the

customer base.

Offering (Product) Strategy: The vendor's approach to product development anddelivery that emphasizes differentiation, functionality, methodology and feature sets as

they map to current and future requirements.

Business Model: The soundness and logic of the vendor's underlying business

proposition.



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Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and

offerings to meet the specific needs of individual market segments, including vertical

markets.

Innovation: Direct, related, complementary and synergistic layouts of resources,

expertise or capital for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to

meet the specific needs of geographies outside the "home" or native geography, either

directly or through partners, channels and subsidiaries as appropriate for that

geography and market.



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