50 Best Managed Global Outsourcing Vendors

A major phase of outsourcing consists of selecting your service providers. That can be a major challenge. As Brown & Wilson Group’s Doug Brown and Scott Wilson write in their best-selling volume on outsourcing, The Black Book of Outsourcing, “There are many capable outsourcing vendors. They come in myriad types and sizes. There are top-tier, full-service, large organizations; second-tier, specialty best-of-breed vendors; and small, strategically located vendors. Making a smart choice among them requires strategizing to decide what type of business you want to become and which vendor has the capability to help you fulfill your goals and improve the corporate bottom line.”

How do you make a smart choice in outsourcing vendors? After you’ve put together your selection team (consisting of representatives from technology, budget and finance as well as staff and management from user groups), the next step in vendor selection involves gathering vendor information. This compilation, put together by the two authors after performing extensive survey work,can help you composea “long list” of companies to whom to issue your requests for information. (Though as the authors explain, “long” is a relative term; they recommend a rule of thumb that your long list have no more than one vendor per member of the selection committee.)

That’s where the “50 Best Managed Global Outsourcing Vendors” list will prove its worth. Chances are, if you’re seeking to outsource IT, human resources or some other business process function, there are several companies on this list you should consider for that long list.

Measure of a Leader

We required companies in the “Top 50 Best Managed Outsourcing Vendors” to have demonstrated consistent strength in four survey areas:

• Human capital performance
• CEO commitment
• Corporate direction
• Leadership impact

Each area is weighted for significance. It’s easier, for example, to obtain data on human capital, so the survey always has had far more questions in this area. In past surveys, therefore, this sector counted considerably more than the other three, just by virtue of having more responses.

However, in our assessment of outsourcing management, we have found that CEO commitment is the most crucial area at this time in the industry’s growth. Without a strong diversity champion at the top of a company, no “best managed” status or management improvement initiative can have long-term success. Therefore, in this year’s survey, we have weighted the questions to give more emphasis to CEO commitment, followed by human capital performance, corporate direction and leadership impact.

Additionally, throughout the survey, we included questions designed to measure satisfaction of clients, customers, users and buyers. In our analysis of the data, we applied these outcomes directly to the information provided by vendor company management. We rated companies on a 100-point scale, based on responses from the customer and employee surveys. The Brown-Wilson Group doesn’t choose or influence the rankings.

Methodology: How We Measured the Top 50

The survey for our “50 Best Managed Global Outsourcing Vendors” was distributed electronically to customers, employees, buyers, contractors and users worldwide in early 2006. In January surveys were sent to 50,000 individuals in corporations, businesses, organizations and government agencies who use, offer and are employed in outsourcing services. The survey was also available on several Websites. Survey participation was voluntary and anonymous. Survey entry codes were available only one time. The survey closed in June 2006. Itconsisted of 26 questions on leadership impact, influence, management performance, client satisfaction, employee satisfaction and organizational excellence. Another 18 optional questions focused on innovation, growth, internal management practices and global results.

A total of 12,755 qualified outsourcing purchasers/users and 3,340 outsourcing corporate employees answered the survey. Of those, 46% were from North America, 22% from Europe and 24% from Asia or the Pacific Region. Of employee respondents, 18.3% were management or supervisory level, 81.7% were non-management.

2006 Best Managed Global Outsourcing Vendors

Rank	Black Book Index	Company	Rank in 2005	Change from 2005	Est. 05 Revenue	Net Profit Margin	Employees	Leader	Services
1	95.1	Affiliated Computer Services (Public, NYSE:ACS): With new CEO and several key acquisitions, Fortune 500 ACS outperforms with 2006\’s top ITO & BPO contracts, High standards & highest customer satisfaction scores.	10	+9	$4.4B	7.45%	52,000	Mark King	BPO, ITO, HRO
2	93.4	Satyam (Public, NYSE:SAY): This outsourcer who pioneered the offshore development center model for software delivery saw profits zoom 54% and record 36% growth. With Accenture\’s former chief marketing officer onboard, Satyam won\’t be satisfied being #2.	19	+17	$1.1B	22.81%	29,000	B. Rama Raju	BPO, ITO
3	92.9	Cognizant (Public, NASDAQ:CTSH): Agile, fast moving, touting a strong track record of delivering business results, One of BusinessWeek\’s ÒHot GrowthÓ companies of 2006.	21	+18	$886M	18.34%	25,000	Lakshmi Narayanan	ITO, BPO
4	92.6	Perot Systems (Public, NYSE:PER): Awarded for superior ITO services, Perot delivered new industry solutions generating big revenue leaps with appreciable expansions into the government and healthcare revenue cycle outsourcing.	43	+39	$2B	5.20%	18,000	Peter A. Altabef	ITO
5	92.2	Infosys (Public, NASDAQ:INFY): Crossing over to $2B in Annual Revenue, INFY acquired Progeon BPO from Citicorp as profits jumped 31%.A corporate recruiting program aims to hire top talent grads from US universities this year.	25	+20	$2.2B	26.02%	58,000	Nandan M. Nilekani	ITO, BPO
6	91.9	Patni (Public, NYSE:PTI): New solutions and well-established, structured methodologies grew income 38%.	45	+39	$450M	12.41%	12,000	Narendra K. Patni	ITO
7	91.4	TATA Consulting Services (Public, BOM:532540): Six of the Fortune Top 10 companies are among TCS\’ valued customers. Pioneer in Indian outsourcing. Annual profits rose another 41% with broad Latin American expansion plans.	33	+26	$2.9B	21.97%	54,000	Subramanian Ramadorai	ITO
8	91.1	HCL (Public, BOM:532281): India\’s original garage start-up, HCL Technologies ranked among the world\’s Top 5 IT services companies & ranked #1 among the world’s specialty offshore infrastructure service providers for two consecutive years.	14	+6	$757M	2.57%	13,000	Shiv Nadar	ITO
9	90.7	GenPact (Public, NYSE:GE): The largest BPO company in India, GenPact is the joint venture between GE and private equity firms. Honored as country\’s most admired employer.	34	+25	$1B	12.25%	30,000	Pramod Bhasin	BPO
10	90.2	Mellon (Public, NYSE:MEL): Mellon\’s efforts to create a complete working capital management solution was highlighted by the acquisition of SourceNet Solutions, a high performing provider of finance and accounting BPO services. Mellon sold its HRO to ACS to focus on asset management product lines. It\’s paying off.	48	+38	$4.3B	18.88%	17,000	Leon Busch	BPO, HRO
11	88.9	Fiserv (Public, NASDAQ:FISV): With a new CEO and COO onboard, Fiserv was on the acquisition track, expanding its technological footprint in the insurance industry. Positive news and strong earnings propelled swiftly growing sales.	New	–	$4.06B	11.66%	23,000	Jeffrey Yabuki	BPO
12	86	ClientLogic (Private): Large global presence with 24 US-based BPO facilities. New Latin American centers greatly expand ClientLogic\’s global footprint while simultaneously bolstering its bilingual and near-shore English services. Top CRM vendor.	New	–	$350M	n/a	22,000	David E. Garner	BPO
13	85.7	Hewlett Packard (Public, NYSE:HPQ): GM awarded more than $700 million in information technology services contracts over a five-year period. Cost reduction & accountability efforts cut over 15,000 jobs.	3	-10	$86.7B	4.07%	150,000	Mark Hurd	ITO
14	85.5	Convergys (Public, NYSE:CVG): Top performing, award winning CRM, Convergys, the largest holder of outsourced SAP licenses in the world, is expanding its 10-year SAP relationship to help accelerate and increase the global growth of its employee care business.	9	-5	$2.6B	4.89%	66,000	James F. Orr	Call, HRO
15	84.7	Capgemini (Public, EPA:CAP): Hard charging for North American business, revenue is up 33%, with outsourcing comprising over 38% of Capgemini\’s total revenue base.	5	-10	$6.9B	2.03%	60,000	Paul Hermelin	BPO, ITO
16	83.4	RR Donnelley (Public, NYSE:RRD): 140-year-old US firm that provides solutions in commercial printing, direct mail & financial printing Acquired two major BPOs in the year: OfficeTiger and Astron, creating processes and distribution for mission-critical information for the world\’s largest companies.	42	+26	$8.4B	1.62%	50,000	Mark A. Angelson	BPO
17	82.9	EXL Service Holdings (Private): EXL is driven on a culture of values that has produced record growth and outstanding client satisfaction ratings in financial outsourcing services.	New	–	$344M	n/a	7,000	Rohit Kapoor	BPO
18	81.6	i-Flex Solutions (Public, BOM:532466): This zero-debt Indian company with 96% of sales originating from software exports offers specialized custom solutions and consulting services to 625 financial services industry customers in 120 countries focused in the lending industry.	32	+14	$323M	16.65%	6,000	Rajesh Hukku	ITO
19	80.7	Sutherland (Private): This global BPO anticipated the surge in the European market demand for global sourcing and invested to capture a large share of this business with top ranked global call centers.	11	-8	$200M	n/a	13,000	Dilip R. Vellodi	Call, BPO
20	80.5	CGI (Public, NYSE:GIB): Founded in 1976, Canada\’s CGI is eighth largest independent information technology and business process services firms in the world. To improve bottom line performance, a 1,000 FTE reduction in force (RIF) distressed internals. 40% growth in 2005.	20	–	$3.28B	6.11%	25,000	Michael E. Roach	BPO
21	77.8	24/7 Customer (Private): Continual improvements earned 24/7 a distinction of being the best performing global call center, lowering attrition & actively mentoring workers to keep clients happy.	22	+1	$300M	n/a	7,000	P.V. Kannan	ITO
22	76	Accenture (Public, NYSE:ACN): Acquired middle market BPOs. Outsourcing net revenues were $1.64 billion, or 40% of net revenues. Record results didn\’t necessarily add up to high client satisfaction rankings as Accenture brings aboard a new chief leadership officer to re-train its 10,000+ managers in 2006.	2	-20	$17.1B	7.18%	123,000	Joellin Comerford	ITO, BPO, HRO
23	74.5	Ceridian (Public, NYSE:CEN): Signed 100th multinational payroll client. Operational and earnings targets well surpassed.	29	+6	$1.46B	9.56%	9,000	Ronald L. Turner	BPO, Call
24	73.6	SOFTTEK (Private): Mexico\’s nearshore outsourcing alternative, Softtek aims to be America\’s top BPO. Softtek is one of the few companies outside of India that has global delivery capabilities.	New	–	$140M	n/a	4,000	Blanca Trevino	BPO
25	71.2	ICICI OneSource (Private): This globally expanding BPO is backed by ICICI Group, which manages total assets of over $38 billion. Its flagship, ICICI Bank, is India’s largest private sector retail bank.	7	-18	$123M	8.99%	8,500	Ananda Mukerji	BPO, Call
26	70.6	WNS Global Services (Private): Rated as India\’s top BPO for two consecutive years by NASSCOM, WNS was recently ranked best performing BPO by neoIT.	49	+23	$165M	n/a	12,000	Neeraj Bhargava	BPO
27	69.8	Outsource Partners International (Private): Largest outsourcing firm dedicated solely to finance and accounting functions, OPI beefed up the marketing team and opened expanded India operations, resulting in three-year revenue growth of 842%.	39	+12	$42.7M	n/a	1,000	Clarence T. Schmitz	ITO, BPO
28	69.6	Datamatics (Public, BOM:532528): IT consulting & software solution clients include 5 of top 10 Fortune 500 companies plus customers in 58 countries.116% revenue growth pumped Datamatics up to be third largest pure BPO in India.	38	+10	$30.3M	14.84%	2,000	Sriram Shrinivasan	BPO
29	69.4	EPAM (Private): With 83% annual growth, a high demand provider of software engineering outsourcing services in Central and Eastern Europe, Moskow\’s EPAM is recognized as one of the top worldwide leaders in application development.	New	–	$60M	n/a	2,000	Arkadiy Dobkin	ITO
30	69.3	Ness Technologies (Public, NASDAQ:NSTC): Israel’s leading IT services and outsourcing company is the big winner of regional BPO business, particularly in banking, insurance & finance. Acquisitions propelled prime growth.	New	–	$386M	n/a	7,000	Raviv Zoller	BPO
31	69.2	TeleTech Holdings, Inc. (Public, NASDAQ:TTEC): The customer is king with Teletech, and TeleTech was king of new and expanded call center contracts this year. Nearly 60% of TeleTech’s revenue is generated internationally with services offered in 150 languages from nearly every continent on the globe.	New	–	$1.1B	2.93%	40,000	Kenneth D. Tuchman	Call
32	68.9	Oracle (Public, NASDAQ:ORCL): Oracle is fighting toe-to-toe with archrival SAP to retain customers picked up through its $20 billion worth of acquisitions, and Oracle’s shopping spree has done little to solve the company’s fundamental problem: sluggishness in its flagship database business.	12	-20	$11.8B	23.51%	50,000	Lawrence J. Ellison	ITO
33	68.3	PeopleSupport (Public, NASDAQ:PSPT): CRM- and AR-focused BPO, PeopleSupport reported record revenues and an increase in net income of 74 %. Lowering its dependence upon its biggest clients over the last few years from around 80% to around 50% and growing product lines while expanding the number of seats for its E-reps is putting big cash in the coffers.	New	–	$62.1M	32.27%	4,000	Lance Rosenzweig	Call
34	67.6	International Business Alliance (Private): IBA, an alliance of privately owned companies, is the largest IT service provider in Eastern Europe. IBM has been a major strategic partner of IBA from the outset.	New	–	$30M	n/a	1,000	Sergei Levteev	ITO
35	65.8	IBM Global Services (Public, NYSE:IBM): Big blue is getting bigger and betting big on outsourcing in India. BPO arm IBM-Daksh added over 10,000 staff in 12 months but overall management satisfaction dropped post acquisition from the top ranked position.	1	-34	$46.2B	9.33%	20,000	Ginni Rometty	BPO, ITO
36	63.5	EDS (Public, NYSE:EDS): A year of executive & strategic operational shake-ups, EDS completed the sale of its global consulting subsidiary, A.T. Kearney, and established an office of the COO to increase alignment and drive change throughout its business operations including takeover of BPO giant MphasiS.	44	+8	$19.7B	1.52%	117,000	Michael H. Jordan	BPO, ITO
37	62.9	Hewitt (Public, NYSE:HEW): One year after Hewitt Associates merged with Exult, Inc., Hewitt sent shock waves through the HRO industry when it announced the retirement of its CEO at year end and the resignation of its president of HRO, effective immediately. At the same time, the company announced that it will be reviewing its guidance for the third quarter and full fiscal 2006 pending a review of its HRO contracts. Wall Street moved Hewitt’s stock price down by 8% to a 52-week low on the day of these announcements.	13	-24	$2.9B	4.76%	22,000	Dale L. Gifford	HRO
38	61.4	vCustomer (Private): Handling tens of millions of customer contacts a month, vCustomer was named by BusinessWeek as a top-10 ÒHot PlayerÓ in global outsourcing call centers. Overall satisfaction took a leap up.	47	+9	$80M	n/a	3,000	Sanjay Kumar	Call
39	58.9	MphasiS (Public, BOM:526299): EDS has completed the acquisition of a majority stake in MphasiS BFL Limited. With the addition of MphasiS and current expansion plans, EDS’ total India work force is projected to exceed 20,000 by year end but management esteem fell.	4	-35	$205M	15.94%	12,000	Jaithirth Rao	BPO, ITO
40	56.3	Wipro (Public, NYSE:WIT): India\’s second largest IT company grew revenue 30% and profit after tax grew by 27%. 5% revenue contribution from innovation initiatives. Management shake-ups caused concern and entry for smaller BPOs to compete.	6	-34	$2.3B	18.95%	55,000	Azim H. Premji	BPO, ITO, Call
41	55	Xansa (Public, LON:XAN): UK-based Xansa offers financial BPO to primarily European clients. Building sales momentum globally with key contract wins.	15	-26	$376M	3.67%	6,000	Alistair Cox	BPO
42	54.1	ADP (Public, NYSE:ADP): Revenues soared through enhanced HRO offerings, ADP pays 1 in 6 private sector workers in the US but competition is capturing payroll marketshare.	31	+11	$8.5B	12.38%	44,000	Arthur F. Weinbach	HRO
43	52.3	Caliber Point (Public, BOM:532129): Newcomer Caliber Point Business Solutions is the independent BPO arm of Hexaware Technologies, an  IT & BPO services company.	New	–	$147.5M	n/a	5,000	Ashok Bildikar	BPO, ITO
44	51.6	Larsen & Toubro InfoTech (Public, BOM:500510): A subsidiary of one of Asia\’s largest construction and engineering corporations and BusinessWeek Asia ÒTop 50Ó technology-driven giant, Larsen & Toubro Limited.	New	–	$2.1B	8.32%	24,000	Vijay Kumar Magapu	ITO
45	49.8	Luxoft (Private): Russia’s leading software developer and IT services exporter has long-term clients including IBM, Boeing, Dell, and Deutsche Bank. Gaining momentum, Luxoft acquired IT Consulting International, New York-based financial services specialist & keeps growing.	New	–	$37.3M	n/a	2,000	Dmitriy Loschinin	ITO
46	49.3	eTelecare (Private): 70% growth in call center business spurs entry on the Philippine Stock Exchange and the Nasdaq later this year or in early 2007.	New	–	$153M	n/a	7,000	John Harris	Call
47	49.1	Unisys (Public, NYSE:UIS): Troubles abound for UIS with RIFs & low morale chatter. Management challenged to react to lower profit margins and higher losses.	17	-30	$5.76B	-29.7%	36,000	Joseph W. McGrath	ITO
48	48.9	Freeborders (Private): Amassing a top notch creative executive team in the US, this technology outsourcing provider from China has secured $20 million in expansion capital from investors and is ready to expand.	New	–	n/a	n/a	1,000	Ramsey Walker	ITO
49	48.6	Computer Sciences Corp. (Public, NYSE:CSC): Big government contract wins but lower client satisfaction scores among large competitors, CSC explored potential sale of the company, then decided to go with a stock buyback program instead. It also announced that it will cut 5,300 jobs over the next two years, mainly from its European operations. Shaky times.	16	-33	$14.6B	3.95%	79,000	Van B. Honeycutt	ITO
50	48.4	SPi (Private): Philippines-based outsourcing leader in the healthcare, legal, publishing and transaction markets, SPi outperformed 15 former list winners & competitor BPOs to make the 2006 rankings. Honored recently as the top global leader in human capital development. Acquired in July 2006, at the time of this writing, by ePLDT.	New	–	–	n/a	6,500	Ernest L. Cu	BPO

Key
BPO: Business process outsourcing
Call: Call center outsourcing
HRO: Human resources outsourcing
ITO: Information technology outsourcing

Trends in Global Outsourcing

Change is a constant among outsourcing vendors. From last year to this year, the following 15 outsourcing vendors have fallen off the “Best Managed” list.

• eFunds
• Keane
• Intelligroup
• Northrop Grumman IT
• Getronics
• Covansys
• Syntel
• Spherion
• Siemens Business Services
• Atos Origin
• Infocrossing
• TechBooks
• i-Gate
• Gevity
• Deloitte

The following 10 companies have fallen in ranking from 2005:

• Accenture
• IBM
• CSC
• Unisys
• Xansa
• Wipro
• MphasiS
• Oracle
• ICICI
• Hewitt

The following ÒFreshman FirmsÓ have moved onto the list in 2006:

• Fiserv
• ClientLogic
• EXL Services
• Softtek
• EPAM
• Ness Technologies
• People Support
• IBA Group
• Caliber Point Hexaware
• Teletech
• Larsen & Toubro Infotech
• LUXOFT
• eTelecare
• Freeborders
• SPi

The following 10 companies have made significant jumps in their 2006 ranking over 2005:

• Infosys
• Patni
• TATA Consultancy Services
• Satyam
• Cognizant
• Perot
• Genpact
• Mellon
• RR Donnelly
• WNS Global

As you can see, the Indian IT outsourcing service sector has effectively challenged the dominance of the six global Goliaths:

• Accenture
• ACS
• CSC
• EDS
• Hewlett Packard
• IBM

As predicted last year by TPI, an outsourcing consulting firm, the outsourcing “big six” are seeing their dominance contested in the outsourcing deals that are in the TPI pipeline and in development. The company said that over 50% of the of the $100 billion worth of outsourcing contracts due for renewal globally in the next two years — out of which $17 billion could come in the next six months — have a significant offshoring component “much of which could come India’s way.”

“The Big Six of outsourcing could see their dominance challenged,” said Dennis McGuire, founder and chairman, TPI. “Historically, buyers would outsource to a single vendor. Now they look for multiple vendors and specialists around the world.”

When you examine the large outsourcing deals signed since September, this trend becomes evident.

In the biggest outsourcing deal coming out of Europe ever, when ABN Amro Bank awarded its $2.2 billion outsourcing contract in September last year, it didn’t just go to the established players such as IBM and Accenture. About $400 million worth of contracts were awarded to TCS ($2