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The firm has published two research reports analyzing FAO and PO suppliers, "Global FAO Supplier Landscape — Leaders, Major Contenders, Emerging Players and the 2009 Star Performers" and "The Dynamic PO Supplier Landscape — Evolving End-to-end Capabilities." The reports, available for purchase from the firm, include supplier evaluations and relative market positions, comparisons of relative market success and capability developments, global supplier landscape changes in 2009, trends of supplier segments based on their offerings, and key investments.
"In the FAO and PO markets, we see two stages of evolution, both of which require buyers to have a strong understanding of the evolving dynamics in these markets to make intelligent decisions that fit the strategies of their organizations," said Saurabh Gupta, research director at Everest. "The mature FAO market is getting increasingly competitive with players vying to carve out unique value propositions to differentiate themselves. On the other hand, the nascent PO market is quite dynamic, characterized by new players entering the market, revised value propositions and significant alliance activity."
The FAO market in 2009 saw successful suppliers fine tune capability mixes and position for anticipated growth this year. IBM, Accenture and Genpact are dominant leaders, but a number of other suppliers are closing the gap. Moving forward, successful suppliers will continue to identify and refine target buyer segments, meet client needs in terms of global delivery capacity and service, bring technology and process solutions that more closely link process operations with business outcomes, and focus on client relationship management
In 2009, the PO supplier market witnessed the emergence of alliances and partnerships between procure-to-pay (P2P) and sourcing-focused suppliers to compete against global end-to-end source-to-pay (S2P) suppliers such as Accenture and IBM. Last year, suppliers engaged in capability investments, primarily focused on enhancing technology and end-to-end S2P capabilities, and willingly took on componentized engagements that allowed buyers to pursue a phased approach to PO.
"FAO buyers should expect business and process impacts beyond labor savings and existing buyers need to be focused on end-of-term strategies to expand value beyond what was gained in existing engagements," said Gupta. "With the expansion of PO supplier landscape, buyers of PO services should exercise their right to chose depending on their desired value proposition."
According to the "Finance & Accounting Outsourcing Annual Report 2010" from Everest, the FAO market in 2010 is expected to resume a growth trajectory more similar to pre-recessionary levels, moving towards 20 percent and reach nearly $3.7 billion in annual contract volume (ACV). Everest's "Procurement Outsourcing Annual Report 2010" projects the PO market will grow in excess of 20 percent in 2010 and reach nearly $1.3 billion in ACV.
More than 20 FAO suppliers with multi-process capabilities are included in the FAO supplier study, including Accenture, ACS-Xerox, Capgemini, Cognizant, Compass BPO, EXL, Genpact, HCL, HP, IBM, iGate, Infosys BPO, Intelenet, KPIT Cummins, Outsource Partners International, Patni, Steria, TCS, Vengroff Williams & Associates (VWA), Wipro and WNS. Suppliers earning Everest recognition as "2009 FAO Market Star Performers" are Genpact, IBM, Infosys, Wipro and WNS.
The PO supplier study includes Everest's analysis across 15-plus suppliers with multi-process capability, including 4C Associates, Accenture, buyingTeam, Capgemini, Corbus, DSSI, Genpact, Global eProcure, HCL, HP, IBM, ICG Commerce, Infosys BPO, TCS, Wipro, WNS and Xchanging. Everest highlighted Accenture, IBM, ICG Commerce, Infosys BPO and TCS as "2009 PO Market Star Performers."
Market Start Performers are suppliers highlighted by Everest that demonstrated the strongest movement across two dimensions last year: market success in 2009 based on ACV growth, number of contract signings and value of contract signings in 2009; and capability advancements in 2009 based on expansion of scale, scope, delivery footprint and technology investments.
More information on the reports is available at Everest's Web site.
