2013 Nordics IT Outsourcing Service Provider …recommend their service provider on a six -point...

2013 NordicsIT Outsourcing

Service ProviderPerformance and

Satisfaction SurveyFinal: September 13, 2013 Copyright KPMG

David G. Lewis,

Head of IT Sourcing Advisory, KPMG Norway [email protected]

© 2012 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

1

Who participated in this study?

More than 200 of the top IT spending organisations in the Nordics

- Size of IT spend estimated at more than €14 billion

Participants are CFO, CIO, CXO or their direct report

More than 350 unique client-provider relationships

- Amount of ACV evaluated estimated at more than €5 billion

20 service providers evaluated


2

Methodology

■ IT survey on trends and satisfaction

■ Survey reflects Perception from end-user clients only (i.e. not KPMG opinions)

■ Focus on top IT spending companies in all sectors

■ In order to be ranked in the report, service providers must have at least eight client evaluations with each a minimum annual contract value of €1 million

■ KPMG uses its own outsourcing deals database, but asks service providers to update the outsourcing deals overview of previous years so that we are certain that all major deals are included

■ Total confidentiality is guaranteed for participants

■ Data collection via web based survey (clients are first contacted to approve their participation)

■ Participants or CIO,CFO,CXO or direct reports


3

Assessment: General Satisfaction and Willingness to Recommend

■ Respondents rated each service provider on general satisfaction via a question (What is your general satisfaction level for these service providers?)

■ On the general satisfaction question, respondents could indicate if they were (very) unsatisfied, through to (very) satisfied with their selected service providers on a six-point scale (please see legend on the right)

■ Scores converted to percentages, where 100% represented the maximum score. 100% means that all the respondents involved in the survey were very satisfied with that service provider

■ Respondents rated each service provider on their willingness to recommend via a question (Based on your experiences with the service providers, to what extent would you recommend them as a partner for outsourcing?)

■ On the willingness to recommend question, respondents could indicate whether they would certainly not, through to certainly recommend their service provider on a six-point scale (please see legend on the right)

■ Scores converted to percentages, where 100% represented the maximum score. 100% means that all the respondents involved in the survey would certainly recommend their service provider

Process: General Satisfaction Process: Willingness to Recommend

Key to scores

Very unsatisfied 0%

Unsatisfied 20%

Somewhat unsatisfied 40%

Somewhat satisfied 60%

Satisfied 80%

Very satisfied 100%

Key to scores

Certainly not 0%

Almost certainly not 20%

Possibly not 40%

Possibly 60%

Almost certainly 80%

Certainly 100%


4

Assessment: Key Performance Indicators (KPIs)

■ Respondents rated each service provider on ten KPIs via a series of statements (see the right call-out box). Against these they indicated if they (totally) disagreed, through to (totally) agreed with each statement on a six-point scale

■ Scores converted to percentages, where 100% represented the maximum score. 100% means that all the respondents involved in the survey totally agreed with the statement

■ Quality: In general, the service provider meets the service levels as set out in the Service Level Agreement

■ Price: The prices the service provider charges for its services are (still) in line with current market prices

■ Risk: The service provider shoulders reasonable commercial risk and makes necessary investments to reduce that risk

■ Operational Relationship: The service provider does a good job actively managing the relationship at the operational level

■ Strategic Relationship: The service provider does a good job actively managing the relationship and the long term objectives of the contract at the strategic level

■ Innovation: The service provider is active in bringing innovation or adapting their service offering when business or technological conditions change

■ Flexibility: The service provider is flexible in bringing changes to the contract

■ Service provider governance: The service provider has an efficient and effective governance model

■ Transition: The service provider has completed the transition successfully, on time and budget and with the required functionality

■ IT security: The service provider has a clear IT security policy and is successful in ensuring the quality of IT security

Process: Key Performance Indicators Key Performance Indicators

Key to scores

Totally disagree 0%

Disagree 20%

Somewhat disagree 40%

Somewhat agree 60%

Agree 80%

Totally agree 100%


5

Screen shot of the actual survey tool

In most cases, providers will evaluate their service providers by comparing them relatively to each other


6

In which sector does your organisation operate?

17%

14%

13%

7%6%

6%

5%

4%

4%

4%

4%

3%

3%

3%2%

2% 1% 1% 1% Banking, Financial services, Insurance

Retail, Wholesale

Manufacturing

Government (central / local)

Energy / Utilities, Oil & Gas

Telecommunication

Consumer Packaged Goods, Food/Beverages

High Tech Products&Services

Transportation & Logistics

Pharma/Biotech/Life

Other

Business Services&Consulting, Construction

Chemicals, Minerals, Natural Resources

Entertainment / Media

Real Estate

Engineering

Automotive

Healthcare Providers

Education

N=183


7

What are your organisation's outsourcing plans for the foreseeable future ALL NORDICS?

16%

26%

33%

11%

14%

We are certain to outsource more

We will probably outsource more

There will be no change in the existing situation

We will outsource less

We cannot say at this point

N=176


8

For what reasons are you considering increasing your existing levels of outsourcing? (Note, across all Nordic Region)

71%

44%

39%

37%

27%

7%

Cost savings

Access to skills

Quality improvement

Financial flexibility

Time to market

Change agent


9

For what reasons are you considering increasing your existing levels of outsourcing in 2013 ? Note, main driver for Norway is dramatically different to other Nordic Countries

45%

36%

36%

27%

18%

9%

FINLAND

67%

56%

44%

22%

22%

NORWAY

77%

42%

39%

35%

23%

3%

SWEDEN

77%

46%

35%

35%

23%

4%

DENMARK

Cost SavingsAccess to SkillsQuality ImprovementFinancial FlexibilityTime to MarketChange Agent


10

Service Providers in terms of number of evaluated contracts

120

39

27

27

2525

24

22

19

18

18

15

13

13

129

99

9 8 8Other

CGI (Logica)

IBM

TeliaSonera

ATEA

Evry

Tieto

HP Enterprise Services

TCS

Accenture

Capgemini

Fujitsu

CSC

Verizon Business

Telenor

HCL

TDC Dotcom

T-Systems

Volvo IT

Atos

Cognizant

N=469


11

What is your general satisfaction level for these service providers?

Key to scores %

Very unsatisfied 0

Unsatisfied 20

Somewhat unsatisfied 40

Somewhat satisfied 60

Satisfied 80

Very satisfied 100

Average 2013:

83%

80%

80%

75%

72%

72%

69%

68%

67%

63%

61%

61%

60%

59%

58%

58%

57%

54%

47%

38%

TCS

HCL

Volvo IT

Cognizant

Accenture

Telenor

T-Systems

TeliaSonera

Capgemini

Tieto

Fujitsu


CSC

IBM

ATEA

CGI (Logica)

Verizon Business

Evry

TDC Dotcom

Atos

64%Average (2012): 67%


12

General Sat by contract value (deals less than €10 million ACV)

Only vendors with at least six contract evaluations associated with an annual contract value lower than €10 million have been included

83%

80%

77%

76%

73%

73%

73%

73%

71%

70%

69%

68%

62%

60%

59%

58%

57%

52%

47%

37%

TCS

Volvo IT

HCL

Capgemini

CSC

Fujitsu


Telenor

Accenture

Cognizant

T-Systems

TeliaSonera

Tieto

IBM

CGI (Logica)

ATEA

Verizon Business

Evry

TDC Dotcom

Atos

TCS 83%Volvo IT 80%HCL 80%Capgemini 67%CSC 60%Fujitsu 61%HP Enterprise Services 61%Telenor 72%Accenture 72%Cognizant 75%T-Systems 69%TeliaSonera 68%Tieto 63%IBM 59%CGI (Logica) 58%ATEA 58%Verizon Business 57%Evry 54%TDC Dotcom 47%Atos 38%

All Contracts %


13

Based on your experiences with the service providers, to what extent would you recommend them as a partner for outsourcing?

Key to scores %

Certainly not 0

Almost certainly not 20

Possibly not 40

Possibly 60

Almost certainly 80

Certainly 100

Average 2013:

91%

86%

80%

80%

78%

77%

73%

71%

67%

63%

63%

62%

60%

59%

57%

55%

55%

54%

49%

34%

HCL

TCS

T-Systems

Volvo IT

Cognizant

Telenor

Accenture

Capgemini

TeliaSonera

Tieto

Verizon Business

ATEA

CGI (Logica)


IBM

CSC

Fujitsu

Evry

TDC Dotcom

Atos66%

Average (2012): 67%


14

Quality ‘In general, the service provider meets the service levels as set out in the Service Level Agreement’

Key to scores %

Totally disagree 0

Disagree 20

Somewhat disagree 40

Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

84%

82%

80%

78%

75%

75%

73%

71%

69%

68%

68%

67%

67%

65%

65%

64%

63%

60%

57%

53%

Volvo IT

HCL

TCS

Cognizant

Telenor

TeliaSonera

Accenture

T-Systems

Capgemini

CSC


IBM

Tieto

ATEA

Verizon Business

Fujitsu

CGI (Logica)

TDC Dotcom

Evry

Atos

69%Average (2012): 73%


15

Price ‘The prices the service provider charges for its services are (still) in line with current market price’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

83%

82%

80%

78%

77%

72%

69%

67%

65%

64%

63%

62%

62%

60%

60%

59%

58%

58%

56%

55%

Cognizant

HCL

Volvo IT

Telenor

TCS

TeliaSonera

Fujitsu

Capgemini


CGI (Logica)

ATEA

Evry

TDC Dotcom

Atos

T-Systems

Accenture

Tieto

Verizon Business

IBM

CSC

67%Average (2012): 68%


16

Risk ‘The service provider shoulders reasonable commercial risk and makes necessary investments to reduce that risk’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

80%

77%

75%

69%

67%

64%

62%

60%

56%

55%

55%

55%

53%

52%

52%

51%

51%

49%

45%

36%

HCL

TCS

Cognizant

Volvo IT

Telenor

T-Systems

Accenture

TeliaSonera


ATEA

CGI (Logica)

Tieto

Fujitsu

Capgemini

Evry

IBM

Verizon Business

Atos

CSC

TDC Dotcom

58%Average (2012): 58%


17

Relationship management (Operational) ‘The service provider does a good job actively managing the relationship at the operational level …’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

87%

82%

78%

73%

73%

71%

70%

68%

67%

66%

65%

65%

65%

63%

60%

59%

58%

58%

54%

40%

HCL

TCS

Volvo IT

Cognizant

Telenor

Accenture


Capgemini

T-Systems

Tieto

CGI (Logica)

Fujitsu

IBM

Evry

Verizon Business

TeliaSonera

ATEA

CSC

Atos

TDC Dotcom

66%Average (2012): 70%


18

Relationship management (Strategic) ‘The service provider does a good job actively managing the relationship and the long term objectives of the contract at the strategic level’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

82%

78%

78%

73%

71%

71%

70%

69%

64%

60%

60%

59%

58%

58%

58%

54%

54%

54%

37%

36%

HCL

Cognizant

TCS

Telenor

Accenture

T-Systems


Volvo IT

IBM

CSC

Fujitsu

Tieto

ATEA

Capgemini

CGI (Logica)

Evry

TeliaSonera

Verizon Business

Atos

TDC Dotcom

62%Average (2012): 64%


19

Innovation ‘The service provider actively identifies innovation opportunities’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

76%

75%

70%

70%

68%

60%

58%

57%

56%

54%

53%

52%

50%

49%

49%

49%

48%

45%

37%

36%

HCL

Cognizant

Accenture

Telenor

TCS

Volvo IT

T-Systems

ATEA


TeliaSonera

Fujitsu

IBM

Tieto

Capgemini

Evry

Verizon Business

CGI (Logica)

CSC

Atos

TDC Dotcom

56%Average (2012): 56%


20

Flexibility ‘The service provider is flexible in bringing changes to the contract’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

84%

77%

73%

73%

72%

67%

64%

62%

60%

60%

60%

58%

55%

55%

55%

52%

50%

49%

46%

36%

HCL

TCS

Cognizant

Volvo IT

Telenor

T-Systems

ATEA

CGI (Logica)

Accenture

Capgemini

Evry

Tieto

CSC

Fujitsu

TeliaSonera

Verizon Business


Atos

IBM

TDC Dotcom

60%Average (2012): 62%


21

Transition ‘The service provider has completed the transition successfully on time and budget and with the required functionality.’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

84%

80%

80%

78%

73%

71%

66%

65%

63%

63%

62%

60%

60%

59%

55%

54%

52%

49%

48%

42%

HCL

T-Systems

Volvo IT

TCS

Cognizant

Accenture

Capgemini

TeliaSonera


Telenor

Tieto

ATEA

Verizon Business

Fujitsu

CGI (Logica)

Evry

IBM

Atos

CSC

TDC Dotcom

63%Average (2012): 66%


22

IT Security ‘The service provider has an efficient and effective governance model.’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

87%

81%

80%

79%

76%

75%

74%

74%

73%

73%

72%

70%

69%

67%

67%

65%

64%

62%

60%

47%

HCL

IBM

Cognizant

TCS

Volvo IT

Telenor

Accenture

Tieto

Fujitsu

T-Systems


CSC

Verizon Business

Capgemini

TeliaSonera

ATEA

CGI (Logica)

Evry

Atos

TDC Dotcom

71%Average (2012): n/a


23

Governance ‘The service provider has an efficient and effective governance model.’

Key to scores %

Totally disagree 0

Disagree 20


Somewhat agree 60

Agree 80

Totally agree 100

Average 2013:

82%

74%

73%

71%

68%

66%

64%

63%

62%

60%

59%

58%

58%

58%

56%

55%

53%

48%

43%

40%

HCL

TCS

Accenture

Volvo IT

Telenor


Fujitsu

Cognizant

Capgemini

Tieto

IBM

ATEA

CSC

T-Systems

CGI (Logica)

TeliaSonera

Evry

Verizon Business

Atos

TDC Dotcom

61%Average (2012): 64%


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2013 Nordics IT Outsourcing Service Provider …recommend their service provider on a six -point...

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