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Global IT-BPO outsourcing deals analysis 2Q16 analysis KPMG.com/in August 2016
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Page 1: Global IT-BPO outsourcing deals analysis - assets.kpmg · KPMG International provides no client services and is a Swiss ent ity with which the independent member firms of the KPMG

© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 1

Global IT-BPOoutsourcingdeals analysis2Q16 analysis

KPMG.com/in

August 2016

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© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 2

About global IT-BPO outsourcing deals analysis

KPMG’s Shared Services and Outsourcing Advisory (SSOA) practice publishes a quarterly analysis on Information Technology and Business Process Outsourcing (IT-BPO) contracts signed across industries and geographies, with a Total Contract Value (TCV) of USD5 million and above per deal.

Methodology and limitations of the study: The analysis and findings presented in this report are based on select third party deals database including, publicly available outsourcing data as identified throughout this presentation. It does not include contract information gathered from KPMG Sourcing Advisory business engagements.

The count and value of the deals may vary notably in reality and is only indicative of market movements and trends in the IT-BPO space. Readers are requested to use their discretion while assessing the global IT-BPO market accordingly.

For more information on this market research, please get in touch with Shailesh Narwaiye([email protected]).

Page 3: Global IT-BPO outsourcing deals analysis - assets.kpmg · KPMG International provides no client services and is a Swiss ent ity with which the independent member firms of the KPMG

ContentsSection 1: Global deals: An overview

Section 2: 2Q16 deal analysis

Section 3: IT-BPO outsourcing outlook

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Section 1Global deals: an overview

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A summary

In 2Q16, 311 ITO contracts worth USD40.1 billion and 21 BPO contracts worth USD739 million were signed, worldwide

IT Bundled Services and CRM contributed approximately USD31.4 billion and USD378.5 million respectively and were the largest procured services globally within ITO and BPO outsourced services, respectively

Globally 8 IT-BPO bundled deals were signed in 2Q16 with contract value worth USD463 million

In terms of value, approximately 71 per cent of deals originated from the United States, followed by theUnited Kingdom at 5 per cent. China and Australia were two other key outsourcing marets

Government and Telecom sectors were the top consumers of IT-BPO services contributing to 65 per cent and 12 per cent in terms of value of outsourcing deals signed in 2Q16. Defense sector was the next big contributor in terms of deal value

Average annualized contract value in 2Q16 was USD23.0 million as compared to USD27.3 million in 1Q16 showing a decrease of 16 per cent between the two quarters

The average deal tenure increased to 5 years 5 months in 2Q16 from 4 years 11 months in 1Q16

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

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© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 6

SnapshotQuarterly deal movements

Quarterly movements of global IT-BPO deals*

• 2Q16 was almost consistent with 1Q16 in terms of total contract value as compared to 1Q16 whilst there was a 49 per cent increase in the total number of deals, indicating that the average deal size has gone down considerable (34 per cent over 1Q16)

*The term deals is interchangeably used with contracts throughout the analysis unless otherwise specified. Deals analyzed are global sourcing contracts of size USD5.0 million and above only. Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

55.9

20.3

43.953.3

28.0 25.2 29.139.8

26.421.8

75.9

38.8

22.8

39.9 41.3

516

299

426 422

326

270

316 324

259

192

334

253

112

228

340

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2012 2013 2014 2015 2016Value (USD billion) No. of deals

Total deal valueUSD120.4 billion

Total deal valueUSD145.5 billion

Number of deals1,473

-17%

Number of deals1,144

-22%

Total deal valueUSD159.1 billion

32%

Number of deals891

-22%

Deal value2Q15

2Q1646%

No. of deals

2Q16

2Q15

2%

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© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 7

Q-o-Q comparison Annualized Contract Value (ACV)

Annualized* contract value comparison per quarter

• Total annualized contract value in 2Q16 decreased by 53 per cent as compared to 2Q15. The average annualized contract value also decreased by 53 per cent during the same period

• The average contract tenure increased by 9 months to 5 years 5 months in 2Q16 over 2Q15

53% decrease

6,371

16,479

7,812

3,500 8,500 13,500 18,500

2Q14

2Q15

2Q16

Total Annualized Contract Value (USD million)

159% increase

Average annualized contract value (USD million)

Average tenure per contract

Note: All values in USD million unless otherwise specified

Minimum annualized contract value

Maximum annualized contract value

53% decrease

5271.4

389.6

0.78

0.44

4 years 9 months

49.34

20.16

2Q15

2Q14

1,532.40.78

2Q16

22.98

5 years 5 months

4 years 6 months

* Annualized contract value = ( total value of a contract / tenure in months ) x 12Contract value for contracts having tenure less than 1 year is considered as annualized value for the analysis. Graph is not to scale and only represents the division across different parametersSource: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

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SectorTotal Contract Value Total Number of Contracts Average Contract Value2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

Automotive & AerospaceBanking & Financial ServicesDefense

Energy & Utilities

Government

Insurance

Manufacturing

Pharma & HealthcarePublishing, Media & EntertainmentRetail

Telecom

Travel & Logistics

Others*

46% 3055% ‐99% 863% 0% ‐33% 0% 40% 46% 4632% ‐99% 451%

360% ‐54% 121% ‐63% 15% ‐53% 157% 64% 299% ‐1% ‐14% ‐63%

‐63% ‐100% 25228% ‐70% ‐53% ‐97% 1900% ‐35% ‐22% ‐96% 1166% ‐72%

27% ‐87% ‐3% 463% 20% ‐42% ‐14% 22% 6% ‐78% 13% 207%

‐51% 19% 689% 3% 22% ‐36% 156% 287% ‐60% 86% 208% ‐27%

1107% 115% ‐71% ‐77% 0% ‐71% 250% 14% 1107% 651% ‐92% ‐80%

‐4% ‐70% 33% 51% 38% ‐68% 86% 271% ‐30% ‐5% ‐28% ‐24%

‐99% 933% 50% 148% ‐82% 100% 50% 233% ‐97% 416% 0% 49%

‐72% ‐100% NA ‐40% ‐78% ‐100% NA 100% 26% ‐100% NA ‐70%

52% 5% ‐74% 180% ‐10% ‐22% 14% 650% 69% 35% ‐77% 49%

105% ‐5% ‐80% 335% 3% ‐35% ‐30% 53% 98% 47% ‐72% 134%

371% 114% ‐75% 167% 0% 0% ‐70% 75% 371% 114% ‐17% ‐62%

‐81% ‐17% ‐6% 118% ‐34% ‐52% 150% 64% ‐71% 75% ‐62% 52%

Q-o-Q comparisonDeals analysis by sector

Trends in deal movement from 2Q15 to 2Q16

• In 2Q16, many sectors have shown an increase in total contract value but Banking & Financial Services, Defense, Insurance and Publishing, Media & Entertainment have shown a decrease in total contract value of more than 25 per cent as compared to 1Q16, along with corresponding decreasing trend in the Average Contract Value

*Others: Construction, Consumer and Recreational Services, Education, Professional services, Securities and investment services, Social services, Trade unions, Technology, WholesaleSource: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

4.55E‐01 3055% ‐99% 863% 0% ‐33% 0% 40% 46% 4632% ‐99% 451%

360% ‐54% 121% ‐63% 15% ‐53% 157% 64% 299% ‐1% ‐14% ‐63%

‐63% ‐100% 25228% ‐70% ‐53% ‐97% 1900% ‐35% ‐22% ‐96% 1166% ‐72%

27% ‐87% ‐3% 463% 20% ‐42% ‐14% 22% 6% ‐78% 13% 207%

‐51% 19% 689% 3% 22% ‐36% 156% 287% ‐60% 86% 208% ‐27%

1107% 115% ‐71% ‐7.73E‐01 0% ‐71% 250% 14% 1107% 651% ‐92% ‐80%

‐4% ‐70% 33% 51% 38% ‐68% 86% 271% ‐30% ‐5% ‐28% ‐24%

‐99% 933% 50% 148% ‐82% 100% 50% 233% ‐97% 416% 0% 49%

‐72% ‐100% NA ‐40% ‐78% ‐100% NA 100% 26% ‐100% NA ‐70%

52% 5% ‐74% 180% ‐10% ‐22% 14% 650% 69% 35% ‐77% 49%

105% ‐5% ‐80% 335% 3% ‐35% ‐30% 53% 98% 47% ‐72% 134%

371% 114% ‐75% 167% 0% 0% ‐70% 75% 371% 114% ‐17% ‐62%

‐81% ‐17% ‐6% 118% ‐34% ‐52% 150% 64% ‐71% 75% ‐62% 52%

Decrease >=25% Decrease <25% Increase <25% Increase >=25%No change

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‐51% ‐42% 90% 11% ‐13% ‐56% 101% 59% ‐44% 32% ‐5% ‐30%

‐40% ‐75% 178% ‐76% ‐68% ‐57% 120% ‐5% 87% ‐42% 26% ‐75%

‐21% 90% ‐77% ‐25% 0% ‐38% 120% ‐27% ‐21% 204% ‐90% 4%

‐20% ‐64% 98% 57% ‐25% ‐56% 84% 69% 6% ‐18% 8% ‐7%

‐44% ‐59% 150% 17% ‐25% ‐60% 152% 19% ‐25% 2% ‐1% ‐2%

‐56% ‐23% 46% ‐15% ‐8% ‐27% 150% 0% ‐52% 6% ‐42% ‐15%

‐66% 45% ‐78% 34% ‐25% ‐33% ‐57% 117% ‐55% 117% ‐49% ‐38%

‐7% ‐12% ‐12% ‐25% 3% ‐56% 98% 21% ‐10% 100% ‐55% ‐38%

‐66% ‐75% 435% 22% ‐71% ‐69% 380% 142% 18% ‐21% 11% ‐49%

Q-o-Q comparisonDeals analysis by category

Trends in deal movement from 2Q15 to 2Q16

• Whilst ITO deals showed an increase both in terms of value and numbers in 2Q16 over 1Q16, BPO deals and Bundled deals showed a decrease in terms of value and numbers

• 2Q16 shows higher deal activity in terms of both number and total contact value of shorter tenure deals (deals less than one year) indicating that organizations preferred short-term outsourcing

• The average contract value of deals has decreased across all categories except for Bundled deals

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

‐51% ‐42% 90% 11% ‐13% ‐56% 101% 59% ‐44% 32% ‐5% ‐30%

‐40% ‐75% 178% ‐76% ‐68% ‐57% 120% ‐5% 87% ‐42% 26% ‐75%

‐21% 90% ‐77% ‐25% 0% ‐38% 120% ‐27% ‐21% 204% ‐90% 4%

‐20% ‐64% 98% 57% ‐25% ‐56% 84% 69% 6% ‐18% 8% ‐7%

‐44% ‐59% 150% 17% ‐25% ‐60% 152% 19% ‐25% 2% ‐1% ‐2%

‐56% ‐23% 46% ‐15% ‐8% ‐27% 150% 0% ‐52% 6% ‐42% ‐15%

‐66% 45% ‐78% 34% ‐25% ‐33% ‐57% 117% ‐55% 117% ‐49% ‐38%

‐7% ‐12% ‐12% ‐25% 3% ‐56% 98% 21% ‐10% 100% ‐55% ‐38%

‐66% ‐75% 435% 22% ‐71% ‐69% 380% 142% 18% ‐21% 11% ‐49%

Deal TypeTotal Contract Value Total Number of Contracts Average Contract Value2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

2Q15 -> 3Q15

3Q15 -> 4Q15

4Q15 -> 1Q16

1Q16 -> 2Q16

ITO

BPO

Bundled

Less than USD 100 mn

Between USD 100-500 mnMore than USD 500 mnLess than 1-year

Between 1 to 5-years

More than 5-years

Decrease >=25% Decrease <25% Increase <25% Increase >=25%No change

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IT-BPO deals across geographies: Q-o-Q comparisonGeography analysis

Geography-wise break-up of deals*

• AMERICAS continues to be the major outsourcing region contributing 74 per cent of the total deal value and 62 per cent of total number of deals in 2Q16. EMA and ASPAC regions contribute to 16 per cent and 9 per cent respectively in terms of deal value

• While AMERICAS and EMA experienced to very minimal growth in deal value as compared to 1Q16, ASPAC experienced a multi-fold growth of more than 376 per cent in 2Q16 vis-à-vis 1Q16

17.4

64.9 63.2

97.5

30.7

206

649

204

453

209

2Q14 2014 2Q15 2015 2Q162.1

8.0 2.2

16.5

0.8

29

97

37

122

37

2Q14 2014 2Q15 2015 2Q16

9.6

47.5

10.4

45.1

6.8

81

398

93

316

94

2Q14 2014 2Q15 2015 2Q16

* Deals originating from the geography

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

EMA

AMERICAS

ASPAC

Total contract value (USD billion) No. of contracts

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© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 11

IT-BPO deals across sectors by value and numbers Sector analysis

Sector-wise break-up of deals (3Q15 to 2Q16)

• The Government and Defense sector lead deal activity, contributing to more than 70 per cent of the total deal value in 2Q16.

• While not all sectors showed an increased deal activity in terms of deal value, all sectors showed an increase in number of deals 2Q16 vis-à-vis 1Q16

2.5

1.1 0.2 0.7

2.2

1.1 0.01 0.1 0.6

6.0

0.8

20.7

2.8

1.2

2.3

6.6

1.4

0.7 0.1 0.1 - 0.7

5.7

0.7 0.03

3.3

2.6

0.7 0.1 0.40.9

0.1 0.2 0.1 0.21.1

0.7

6.9 26.0

1.0 0.2

0.8 1.0 1.3

0.8 0.5 0.1 0.5

4.9

1.4 2.1

26.9

Banking and

Financial Services

Insurance Automotive and

Aerospace

Travel and Logistics

Manufacturing Energy and Utilities

Pharma and Healthcare

Publishing, Media and

Entertainment

Retail Telecom Others * Defense Government

Q3-2015 Q4-2015 Q1-2016 Q2-2016

7 7

18

6

24

107

6 4

82

77

3

13

76

8

15

10

22

12

2 2

9

31

21

7

2014

6650

2

36 40

2

1518

810

21

26

11 10

4

26

42

32Dea

l Val

ue (U

SD

bill

ion)

4

10

25

* Others: Construction, Consumer and Recreational Services, Education, Professional services, Securities and investment services, Social services, Trade unions, Technology, Wholesale

Graph is not to scale and only represents the division across different parameters. Figures may not add up to 100 per cent due to rounding off

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

No. of contracts

TCV : USD 41.3 billionNo. of contracts: 340 116

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© 2016 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. All rights reserved. 12

Q-o-Q comparisonNew and renewal* deal analysis

Analysis of new and renewal* deals

• After having seen the highest deal activity over the last four years in 1Q16, 2Q16 saw a dip in all the segments – ITO, BPO and Bundled

• There has been remarkable few new BPO deals in 2Q16 as compared to 2Q15 when there was a significantly large number of new deals – 2Q16 looks very similar to 2Q14 in this trend

42.7

23.9

73.7

39.7

1.3 5.2

2.2 1.6

Q2 Q2 Q2 Q2

2013 2014 2015 2016

33.3

21.6

65.6

38.7

0.5 4.0

1.0 1.4

Q2 Q2 Q2 Q2

2013 2014 2015 2016

5.0

1.1

7.3

0.50.3

1.1

0.2 0.2

Q2 Q2 Q2 Q2

2013 2014 2015 2016

New RenewalTotal contract value (in USD bn)

All deals ITO BPO

* Renewal deals include contracts which have been extended, expanded, extended & expanded and renegotiated

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

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Section 22Q16 deal analysis

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Deal valueIT-BPO deals* signed in 2Q16(Total contract value: USD41.3 billion)

• ITO deals continue to dominate the outsourcing space with a contribution of 97 per cent to the total deal value signed in 2Q16

• AMERICAS continues to be the major outsourcing region contributing 74 per cent of the total deal value in 2Q16. EMA and ASPAC contribute 16 per cent and 9 per cent respectively

• 2Q16 saw a significantly high number of hybrid pricing deals – the highest witnessed since 2013

ITO40.1

BPO 0.7 Bundled 0.5

Americas30.7

EMA6.8

ASPAC 3.8

Less than USD 100 MN 6.6

Between USD 100- 500 MN15.6

More than USD 500 MN19.1

Less than 1-year0.1

Between 1 to 5-years11.9

More than 5-years29.2

Fixed Price12.7

Hybrid26.4

2.2

Services Region Contract Value Tenure Pricing

Time & Material

Total contract

value

USD 41.3 billion

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

#

* Deals analyzed are USD5.0 million and above only, throughout the analysis. Graph is not to scale and only represents the division across different parameters. Figures may not add up to 100 per cent due to rounding off

# Hybrid pricing includes a combination of various pricing mechanisms

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

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Number of dealsIT-BPO deals* signed in 2Q16 (Total number of contracts: 340)

• ITO deals and BPO deals contribute to 91 per cent and 6 per cent respectively in terms of number of deals signed in 2Q16

• 72 per cent of the deals, in terms of number of deals signed in 2Q16, were of value less than USD100 million• Deals with tenure between one to five years were largest in number, comprising 61 per cent to the deals signed

in 2Q16

* Deals analyzed are USD5.0 million and above only, throughout the analysis. Graph is not to scale and only represents the division across different parameters. Figures may not add up to 100 per cent due to rounding off

# Hybrid pricing includes a combination of various pricing mechanisms

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

ITO311

BPO 22Bundled 8

Americas209

EMA94

ASPAC 37

Less than USD 100 MN245

Between USD 100- 500 MN

75

More than USD 500 MN 20

Less than 1-year13

Between 1 to 5-years211

More than 5-years116

Fixed Price177

Hybrid96

67

Services Region Contract Value Tenure Pricing

Total contracts

340

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

#

Time & Material

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Services segmentationAnalysis of ITO deals 2Q16

• There have been many large IT Bundled Deals because of which though this service segment contributes to only 43 per cent in terms of deal numbers, it contributes to 73 per cent of all ITO deals in terms of value

• SMAC and ICT Services are other key contributors to the ITO deals in 2Q16

Note: Size of bubble indicates per centage share of the total number of ITO dealsSI – System Integration, Other IT services – Software testing, IT Education and Training, SaaSSource: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

Number of DealsADM5%

ERP1%

ICT Services15%

IT Bundled services

43%

IT Infrastructure5%

IT Products4%

Other IT Services, 1%

SI6% SMAC

19%

0

5

10

15

20

25

30

35

0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150

Tota

l Val

ue o

f con

tract

s (U

SD

Billi

on)

Value of contracts (USD Billion)Note: All values in USD billion. Scale of graph is just representative to illustrate the division across different parameters. Figures may not add up to 100 per cent due to rounding off. Refer L.H.S. figure for legend

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

0.4 0.1 2.9

31.4

0.00

0.9 0.40.7 3.1

0.1

40.1

ADM ERP TotalITO

ICT IT Bundled

ITInfra.

ITProducts

SMACSIIT Conslt.

Other ITServices

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Services segmentationAnalysis of BPO deals 2Q16

• CRM deals contributed to the most deal activity amongst BPO deals - more than 50 per cent of all BPO deals in terms of value and 29 per cent both consolidated in terms of number of deals during 2Q16

Note: Size of bubble indicates per centage share of the total number of BPO deals

Other BPO services – Data management, logistics etc.

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

BPO Bundled services

14%

CRM9%

F&A18%

HRO23%

Other BPO Services

18%

SCM18%

0

50

100

150

200

250

300

350

400

450

0 1 2 3 4 5 6

Tota

l Val

ue o

f con

tract

s (U

SD

Milli

on)

Number of Deals

100

379

1145

32

100

739

BPOBundledServices

CRM TotalBPO

HRO OtherBPO

ServicesValue of contracts (USD Million)

SCMF&A

Note: All values in USD million. Scale of graph is just representative to illustrate the division across different parameters. Figures may not add up to 100 per cent due to rounding off. Refer L.H.S. figure for legend

Source: IDC (www.idc.com), Contract Database, Jul 2016, KPMG member firms research & analysis based on the IDC contract database

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Section 3IT-BPO outsourcingoutlook

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Global outsourcing industry Outlook

• 2Q16 also showed a deal activity similar to 1Q16 – while over the years we have seen that the second quarter is always the strongest quarter of the year

• IT outsourcing clearly dominated 2Q16 deal activity with BPO deals and Bundled deals having very minimal activity

• The value of renewal deals is miniscule as compared to new deals with many organizations actively exploring outsourcing as a part of their business transformation efforts from a more wide-ranging process standpoint

• Government and Defense sectors are the main consumers of IT&BPO services – after a slump in 4Q15, the sector has shown quite an improvement over 1Q16 and 2Q16

• Unlike previous quarters where traditional pricing models were relatively highly prevalent as compared to a hybrid model, 2Q16 showed organizations exploring hybrid pricing more than fixed pricing

• While EMA is continuing to gain outsourcing momentum, 2Q16 deal activity has been driven by the AMERICAS which continues to be the major outsourcer

• SMAC services and automation are major drivers for the commoditization of the outsourcing services and this is especially true for IT services. There are still only a few stand-alone SMAC deals but are now becoming a common part of bundled deals

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KPMG Shared Services and Outsourcing Advisory (SSOA) research

To learn more, log on to http://www.kpmg-institutes.com/institutes/shared-services-outsourcing-institute.htmlAdvice Worth Keeping Blog: http://blog.equaterra.com/Advice Worth Keeping podcast series: http://www.kpmginstitutes.com/shared-services-outsourcing-institute/events/podcast_series/advice-worth-keeping-podcast-series.aspxGlobal IT-BPO Outsourcing Deals Analysis: http://www.kpmg.com/IN/en/IssuesAndInsights/ArticlesPublications/KPMG-Deal-Tracker/Pages/Default.aspx

Latest from the KPMG Shared Services and Outsourcing Institute• GBS 2020 Webcast: A vision for the future of Global Business Services • KPMG Global Insights Pulse: The need for GBS maturity• Global IT-BPO outsourcing deals analysis: 1Q16 analysis - January to March

About KPMG InstitutesKPMG Institutes is dedicated to helping organisations and their stakeholders identify and understand emerging trends, risks and opportunities. We do this by creating an open forum where peers can exchange insights, share leading practices, and access the latest thought leadership publications.As a result, corporate executives, business managers, industry leaders, government officials, academics, and others have access to the thought leadership documents and knowledge which they can use to make better informed decisions and meet their marketplace challenges.

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Glossary (1/2)

Terms Definition

ACV Annualized Contract Value = ( total value of a contract/tenure in months ) x 12

AMERICAS North America and South America

ASPAC Asia and Oceania

BPO Business Process Outsourcing

EMA Europe, Middle East and Africa

ITO Information Technology Outsourcing

TCV Total Contract Value

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Glossary (2/2)Terms DefinitionITO ServicesADM Application Development and MaintenanceERP Enterprise Resource Planning implementation and support services

ICT Services Information and Communication Technology services (e.g. contact center technology, telecommunication, and related services)

IT Bundled Services Any combination of two or more IT services mentioned aboveIT Consulting Information Technology Consulting services

IT Infrastructure IT hardware deployment (e.g. data center outsourcing, network management, hardware deploy and support, hosting services, etc.)

IT Products Software products typically developed and branded by IT companies and sold as own Intellectual Property

Other IT Services Typically services that do not fall in other buckets (e.g. Software testing, IT helpdesk support services, Cyber security)

SMAC Social, Mobile, Analytics and Cloud services (i.e. Social Media, Mobility, Analytics and Cloud computing)

System Integration IT system integration services (application or enterprise system integration services)BPO ServicesBPO Bundled Services Any combination of two or more BPO services mentioned aboveContent Management Data management services (e.g. document management, print management, etc.)CRM Customer Relationship Management solutions and servicesF&A Finance and Accounting servicesHRO Human Resource Outsourcing servicesKPO Knowledge Process Outsourcing services

Other BPO Services Typically services that do not fall in other buckets (e.g. Industry specific processes, Facilities Management)

SCM Supply Chain Management services (including procurement, logistics etc.)

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KPMG contacts

Jehil ThakkarPartner – Advisory ServicesKPMG in India+91 22 3090 [email protected]

Viral ThakkerPartner – Advisory ServicesKPMG in India+91 22 3090 [email protected]

Stan Lepeak Director – Global Research, Management ConsultingKPMG in the US+1 203 458 [email protected]

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Thank you

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

The KPMG name and logo are registered trademarks or trademarks of KPMG International.

This document is meant for e-communications only.

Analyst Team Contact:Shailesh NarwaiyeKPMG in IndiaT: +91 20 3050 4000E: [email protected]

Analysts (KPMG in India): Esther JaydeviSwati Kumari


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