By Narayan Ammachchi
Indian outsourcing firms such as Cognizant and Wipro captured nearly a quarter of the top 100 outsourcing deals in 2014, according to a study by research firm IDC.
Despite being small in size compared to their American peers, Indian BPO providers are proving strong competitors for large outsourcing deals. To strength their hand they are putting forward new offerings such as cloud and hosting services.
Analysts say that investing in more transformative capabilities in areas such as analytics, social media, and mobility, and enhancing strategic local capabilities and resources, have enabled them to compete successfully with well-established players.
Leveraging the offshore business model has also contributed greatly to their success, according to David Tapper, IDC’s Vice President, Outsourcing and Offshore Services.
According to IDC’s data, Indian outsourcing companies represented more than 50% of the total contract value of the top 100 outsourcing deals in 2014. In 2013, by comparison, they represented 43% of the total contract value.
Globally, the top five vendors – who include the likes of IBM and CGI – have continued to snap up nearly 50% of high-valued outsourcing deals. With US$13.8 billion worth of deals, IBM tops the list. CGI is ranked second, though the value of the contracts ($2.8 billion) it won is considerably lower.
Indian firms Cognizant and Wipro are quickly catching up with CGI, having won contracts worth $2.7 billion and $2.3 billion respectively.
The research firm says the number of mega deals is currently shrinking, as are the number of government contracts. Furthermore, very few providers are competing for mega deals, partly due to a belief that large deals can be very complicated to implement.
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