June 14, 2007

The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 by Paul Roehrig, Ph.D. for Sourcing & Vendor Management Professionals

Making Leaders Successful Every Day

For Sourcing & Vendor Management Professionals Includes a Forrester Wave™ and data from Business Data Services June 14, 2007

The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007

Accenture And EDS Stand Out, But India-Based Firms Challenge The Old Guard by Paul Roehrig, Ph.D. with Christine Ferrusi Ross and Allison Thresher

EXECUT I V E S U M MA RY Forrester evaluated leading global IT infrastructure outsourcing service providers across 31 criteria — including additional 23-item reference client surveys — and found that Accenture and EDS stand out from the rest based on the formidable delivery capabilities and strategic focus of each. Not surprisingly, Capgemini, CSC, HP, and IBM all maintained their leadership in this mature business. Relatively small Perot Systems and financially struggling Unisys also just made it into the Leaders band, mainly buoyed by first-rate reference client scores. Not surprising for those paying attention to India-based firms, TCS, Infosys, small but formidable HCL, and giant Wipro also demonstrated high-quality capability and — for the first time — achieved leadership positions.

TABLE O F CO N T E N TS 2 Infrastructure Services Are Essential For Global Commerce Infrastructure Management Business Growth Is Beating Projections 3 Global IT Infrastructure Outsourcing Evaluation Overview Evaluation Criteria All Providers Evaluated Have A Strong Market Presence Comparing India-Based Firms With Legacy Multinational Providers 9 EDS Leads In Current Offering; India-Based Providers Jump Into Leaders Band 12 Service Provider Profiles Leaders: Accenture And EDS Along With Some India-Based Firms And Perennial Favorites

N OT E S & R E S O U R C E S Forrester conducted services evaluations in Q1 2007 and assessed19 service providers: Accenture, ACS, Atos Origin, Capgemini, Cognizant, CSC, EDS, Getronics, HCL, HP, IBwM, Infosys, LogicaCMG, Perot Systems, Satyam, T-Systems, TCS, Unisys, and Wipro.

Related Research Documents “The Forrester Wave™: Global Delivery Infrastructure Management For Europe, Q4 2006” December 6, 2006 “The Forrester Wave™: IT Sourcing Deal Transformation Management, Q2 2006” May 15, 2006 “The Forrester Wave™: Global Delivery Infrastructure Management, Q4 2005” December 9, 2005

Strong Performers: EMEA-Based Firms With ACS And Cognizant Contenders: Satyam 17 Supplemental Material

© 2007, Forrester Research, Inc. All rights reserved. Forrester, Forrester Wave, RoleView, Technographics, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. Forrester clients may make one attributed copy or slide of each figure contained herein. Additional reproduction is strictly prohibited. For additional reproduction rights and usage information, go to www.forrester.com. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. To purchase reprints of this document, please email [email protected].

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

INFRASTRUCTURE SERVICES ARE ESSENTIAL FOR GLOBAL COMMERCE While perhaps not as flashy as iPods, nanotechnology, or service-oriented architecture, IT infrastructure is the plumbing that consumes massive amounts of capital and supports commercial activity in the modern world — and when it fails, everyone pays attention. Anyone intimately involved in any aspect of IT management pays attention to the infrastructure, and as outsourcing continues to grow as a business imperative, more and more attention is being paid to infrastructure outsourcing deals and infrastructure service providers. In aggregate, the providers in this Forrester Wave research manage a gargantuan amount of the IT infrastructure space, including:

· Remote and on-site support services for about 15 million desktops. · Management of more than 1 million servers. · Management of about 740,000 wide-area network (WAN) and local-area network (LAN) devices.

· Help desk services for nearly 18 million end users globally. The 19 global firms in the study make about $70 billion annually on the infrastructure services business to pay for the work done by 319,000 dedicated infrastructure employees worldwide to serve more than 11,000 separate client firms. Also, the provider firms in this single study account for more than $300 billion in total annual revenue. If all the providers in this study were a single county — “Outsource-istan,” for example — its GDP would rank somewhere between Austria’s and Sweden’s.1 Infrastructure Management Business Growth Is Beating Projections Not only is the infrastructure management business large, but it’s also growing steadily — and older assertions are being amended to reflect rapidly expanding growth. Based on provider data, the average growth rate in this line of business in 2006 was about 14% for providers not based in India. For India-based service providers, the growth rate was a stunning 71%, and there are no signs of slower infrastructure business over at least the next several quarters. With 68% of technology decision-makers focusing on reducing IT spend, cost cutting is still the hottest topic in IT management, and 42% of IT executives will be relying on outsourcing to help achieve those goals (see Figure 1).

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

Figure 1 2007 IT Budgets Favor Cost Reduction, Apps Implementation, And Outsourcing “Which of the following are likely to be one of your IT organization’s major themes for 2007?”

Not on our agenda Curtail IT services spending

On agenda

Priority

30%

Implement or expand the use of offshore development or maintenance activities Take back or insource an activity that you currently outsource

Hire a consulting or systems integration firm for a major apps implementation

35%

25%

65%

18% 10% 5%

66%

Implement or expand IT outsourcing

57% 42%

Critical priority

29%

8%

19% 10%

3%

28% 10%

4%

21% 7%

Base: 1,143 technology decision-makers at North American and European enterprises (percentages may not total 100 because of rounding) Source: Business Technographics® November 2006 North American And European Enterprise IT Budgets And Spending Survey 41417

Source: Forrester Research, Inc.

GLOBAL IT INFRASTRUCTURE OUTSOURCING EVALUATION OVERVIEW To assess the state of the global IT infrastructure outsourcing market and see how the service providers stack up against each other, Forrester evaluated the strengths and weaknesses of top infrastructure outsourcing service providers. Evaluation Criteria All of the major providers can successfully manage outsourced IT services, and service portfolios generally have a high degree of overlap — such as help desk and network management — so clients are seeking ways to meaningfully differentiate service providers in an increasingly commoditized marketplace. This study assessed provider capabilities and presence in several core infrastructure management service towers.

· Help desk services. This area included services like incident and problem management and level-one and/or level-two support.

· Data center services. This area included services like hosting, server management, and facilities management.

· Managed network services. Managed network services included services like LAN, WAN, voice, voice over IP, and telephony.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

· Desk-side/on-site support services. This area included services like break-fix; install, move, add, change; and asset management

· Desktop management services. Desktop management services included services like design, configuration, testing, and standards.

· Mainframe services. Mainframe services include operations, production control, technical support, and monitoring for mainframe environments.

This study also took into account what has become a major differentiator for clients: a provider’s ability to consistently implement technical and business change in a comprehensive IT infrastructure outsourcing deal. To assess this, we conducted an additional survey of several reference clients from each of the service providers to collect real-world data on sourcing deal implementation, account management implementation, service delivery quality, and general client satisfaction. Based on past research, user requests, and service provider and expert reviews, we developed a comprehensive set of evaluation criteria (see Figure 2). We evaluated service providers against approximately 31 criteria, which we grouped into three high-level buckets:

· Current offering. To assess each service provider’s current offering, we evaluated it against

strength and positioning of a global service delivery model, geographic staffing distribution, staff transfer experience, reference client feedback, and implementation capability. Forrester surveyed 60 reference clients from North America; Europe, the Middle East, and Africa (EMEA); and Asia Pacific (AP) who have visibility into how well the providers are implementing and delivering infrastructure services.

· Strategy. Our assessment of strategy measured each service provider’s overall strategy around

its client value proposition and vision, planned enhancements in the infrastructure management business, plans for geographic growth, and investment allocated to support strategic growth.

· Market presence. We assessed market presence by using a combination of criteria, including

financial strength as measured by corporate revenue, infrastructure management revenue, corporate profitability, infrastructure management revenue percentage, and infrastructure management revenue growth. We also evaluated the breadth of the existing client base, the number of employees dedicated to infrastructure management, the market presence that each firm has by line of service, and the total number of employees. Each measure resulted in score relative to the other respondents rather than an arbitrary threshold. Firms were ranked by quartile for each measure and then assigned a score (see Figure 3).

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Figure 2 Evaluation Criteria CURRENT OFFERING Global delivery model

What are the provider’s global delivery capabilities (Americas, EMEA, and Asia Pacific)? How does the provider’s global delivery capability differentiate against competitors’? Does the provider have interconnected operation centers on which it can distribute remote operations for clients? How does the provider deliver value to clients by leveraging the onshore/nearshore/offshore global delivery model?

Geographic staffing distribution

How well distributed is the provider’s global infrastructure management workforce?

Staff transfer experience

What is the number of organizations for which the provider has taken over more than 20 employees over the past three years? What is the largest takeover that the provider performed over the past three years?

Implementation capability

What is the firm’s vision, approach, and methodology for implementation and transformation in infrastructure management deals?

Clients on implementation

How do reference clients perceive the provider’s ability to implement the deal according to plan and without major disruption?

Clients on account management

How well does the infrastructure management provider manage the business and account management aspects of a sourcing deal?

Clients on service quality

For the services contracted, in general, how well does the provider deliver?

Clients on general satisfaction

How satisfied are clients with the provider’s ability to implement deals and transform the delivery environment?

STRATEGY Client value proposition and What is the provider’s value proposition associated with infrastructure vision management? How is infrastructure management differentiated against competitors? How does the provider see infrastructure management evolving over the next few years, and what is the provider’s vision to prepare for the changes? Planned enhancements

What new intellectual property (e.g., tools, content, or methods) will the provider develop or implement to improve its infrastructure management capability in the next 24 months? How do these enhancements position the firm for market leadership? How do these enhancements support increasing demand for offshoring?

Plans for geographic growth What are the provider’s plans for geographic growth acquisitions, organic growth, and others over the next 24 months that will expand and support the infrastructure management line of business? Investment to support strategy

What is the estimated percentage of total business unit revenue spent on improvements (R&D, new infrastructure concepts and architectures, and techniques/ideas/tools) to improve transition/implementation and transformation capability in the past calendar or fiscal year? Source: Forrester Research, Inc.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

Figure 2 Evaluation Criteria (Cont.) MARKET PRESENCE Service market presence

What is the provider’s relative overall presence in core infrastructure management lines of service for desktop management, on-site support, data center, managed network, help desk, and mainframe services?

Financial strength

How strong is the provider’s overall relative financial position, including revenue and profitability? How strong is the financial performance related to infrastructure outsourcing services?

Client base

What was the total number of IT sourcing clients (separate logo) that the provider had at the end of 2006?

What was the number of employees dedicated to IT infrastructure Employees dedicated to infrastructure management management services at the end of 2006? Total employees

What was the total number of employees in the firm at the end of 2006? Source: Forrester Research, Inc.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

Figure 3 Quartiles For Market Presence Measures Service market presence Desktop management services Desk-side/on-site support services Data center management services

Minimum value

First quartile

Second quartile

Third quartile

Maximum value

80,000

217,500

350,000

1,057,892

3,000,000

11,000

100,000

279,000

1,200,000

2,900,000

6,000

19,000

42,650

62,701

300,000

0

15,000

25,999

51,500

115,000

15,000

234,958

399,000

807,892

5,147,745

0

5,671

30,600

56,000

800,000

Managed network services Help desk services Mainframe services Financial strength Corporate revenue

$976,000,000 $2,684,765,000 $5,400,000,000 $15,607,500,000 $91,658,000,000

Infrastructure management $60,000,000 revenue

$250,000,000 $1,300,000,000 $3,761,000,000 $24,123,500,000

Corporate profitability

-5.50%

2.85%

5.85%

15.57%

27.50%

Infrastructure management revenue percentage Infrastructure management revenue growth

4.00%

9.50%

17.00%

31.30%

56.00%

0.02

4.5%

10.0%

44.5%

94.0%

0

135

442

783.5

2,143

Employees dedicated to infrastructure management

1,500

5,218

10,000

17,833

94,827

Total employees

21,000

38,519

58,000

80,750

356,000

Client base

41417

Source: Forrester Research, Inc.

All Providers Evaluated Have A Strong Market Presence Only the strongest global firms with a track record of success in the infrastructure space were able to be included in this study. Forrester included 19 service providers in the assessment: Accenture, ACS, Atos Origin, Capgemini, Cognizant, CSC, EDS, Getronics, HCL, HP, IBM, Infosys, LogicaCMG, Perot Systems, Satyam, TCS, T-Systems, Unisys, and Wipro. In addition to a desire to participate, each of the providers met particular selection criteria (see Figure 4).2

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Figure 4 Evaluated Providers: Provider Information And Selection Criteria Provider

Total number of IT sourcing clients

Date evaluated

Accenture

600+

Jan. ’07-Mar. ’07

ACS

298

Jan. ’07-Mar. ’07

Atos Origin

2,000

Jan. ’07-Mar. ’07

Capgemini

442

Jan. ’07-Mar. ’07

Cognizant

130+

Jan. ’07-Mar. ’07

CSC

400+

Jan. ’07-Mar. ’07

EDS

2,143

Jan. ’07-Mar. ’07

Getronics

480

Jan. ’07-Mar. ’07

HCL

140

Jan. ’07-Mar. ’07

HP

~700

Jan. ’07-Mar. ’07

IBM

1,091

Jan. ’07-Mar. ’07

Infosys

108

Jan. ’07-Mar. ’07

LogicaCMG

250+

Jan. ’07-Mar. ’07

Perot Systems

76

Jan. ’07-Mar. ’07

Satyam

541

Jan. ’07-Mar. ’07

T-Systems

~1,000

Jan. ’07-Mar. ’07

TCS

250+

Jan. ’07-Mar. ’07

Unisys

Not disclosed

Jan. ’07-Mar. ’07

Wipro

867

Jan. ’07-Mar. ’07

Provider qualification criteria Provider has more than 10,000 employees. Provider has annual sales/revenue greater than $500 million. Primary business focus is not on hardware or applications. Company is able to provide service on multiple IT infrastructure management service towers to the commercial market. Primary Standard Industrial Classification codes are generally 7371, 7373, 7374, 7376, and 7379. Primary industry is listed as Information Technology Services. Provider is able to deliver roughly equivalent infrastructure services in multiple geographies — at least Americas, EMEA, and AP. Provider functions mainly as a prime (versus subcontractor) in outsourcing deals. Source: Forrester Research, Inc.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

Comparing India-Based Firms With Legacy Multinational Providers Does size matter? is a question that has plagued IT philosophers for decades. The average number of employees dedicated to infrastructure work within India-based firms in this study is about 5,600. For all the rest, the average is about 22,000. So how and why should these firms be compared on the same playing field? The first reason is that all firms met the stringent entry criteria, but there is a secret in the outsourcing business: All the major firms included here can do infrastructure services work well. The real question is, how do you make sure that they do the work for you? To get to the answer to that question, with the exception of market presence measures (where relative scale matters a lot), the criteria used in this Forrester Wave are intended to create a roughly level playing field where capability and articulation of a strategic direction can be demonstrated whether the firm has thousands or hundreds of thousands of employees. Providers are being compared on differentiating criteria that might only emerge during an RFP process (if at all), such as global delivery capability, transformation management capability, reference client satisfaction, and account governance. EDS LEADS IN CURRENT OFFERING; INDIA-BASED PROVIDERS JUMP INTO LEADERS BAND The evaluation uncovered a market in which (see Figure 5):

· Accenture and EDS lead the pack. Based on Forrester’s weightings, EDS, a perennial delivery

powerhouse, has the strongest overall score and current offering score. Accenture showed its current global infrastructure strength and solid strategy to come extremely close overall to EDS’s performance. Capgemini also showed a solid current offering and tied with Wipro to the field with a well-articulated strategy for future infrastructure outsourcing business. Perhaps the biggest news is that several India-based firms are moving past the wage-arbitrage play and focusing on value generation through better infrastructure management; also, four firms broke into leadership positions in our Forrester Wave assessment. Although dwarfed in overall market presence by giants like IBM, EDS, and HP, India-based firms HCL, Infosys, TCS, and Wipro showed strong delivery capability, good reference client scores, and solid valuebased strategies for the future. Relatively small Perot Systems and financially wobbly Unisys also positioned themselves as leaders with excellent infrastructure capability as evidenced by topflight reference client scores. Not surprisingly, perennial global favorites Capgemini, CSC, HP, and IBM all maintained their spots in the Leaders band in this mature business.

· EMEA-based firms join ACS and Cognizant as Strong Performers. ACS is clearly a strong

player in the infrastructure space and has a solid strategy for future business in place; however, less-robust current global capability and middle-of-the-road client scores kept it just outside of the Leaders band. EMEA-based firms Atos Origin, Getronics, LogicaCMG, and T-Systems

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all have good current capabilities but landed in the Strong Performers band because of lessthan-glowing client scores, slightly underdeveloped future strategies, and fairly EMEA-centric regional delivery models. India-based Cognizant showed solid competitive infrastructure offerings, too.

· Satyam is a Contender. Satyam was among the smallest of the firms considered in its

infrastructure service market presence, but based on the financials, it’s clear that Satyam has capability in this space and many satisfied clients. However, the firm was held back by lackluster reference client scores and is nascent in the infrastructure outsourcing market. Satyam also needs to strengthen its strategic focus on transformation, innovation, and the value of a true global delivery model.

This evaluation of the global IT infrastructure outsourcing market is intended to be a starting point only. Readers are encouraged to view detailed evaluations and adapt the criteria weightings to fit their individual needs through the Forrester Wave Excel-based service provider comparison tool. Figure 5 Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 ’07 Risky Bets

Contenders

Strong Performers

Leaders

Strong EDS CSC Unisys IBM Perot Systems Getronics

HP

Infosys

TCS Capgemini

ACS

HCL

LogicaCMG

Go online to download the Forrester Wave tool for more detailed product evaluations, feature comparisons, and

Wipro

Atos Origin

Current offering

Accenture

customizable rankings.

Cognizant T-Systems

Satyam

Market presence

Weak

Weak

Strategy

Strong Source: Forrester Research, Inc.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

Forrester’s Weighting

Accenture

ACS

Atos Origin

Capgemini

Cognizant

CSC

EDS

Getronics

HCL

HP

Figure 5 Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 ’07 (Cont.)

CURRENT OFFERING Global delivery model Geographic staffing distribution Staff transfer experience Implementation capability Clients on implementation Clients on account management Clients on service quality Clients on general satisfaction

50% 30% 4% 4% 30% 6% 8% 10% 8%

4.48 5.00 5.00 4.00 5.00 3.00 3.00 3.00 5.00

3.52 4.00 2.00 4.00 4.00 5.00 3.00 1.00 3.00

2.68 3.00 1.00 3.00 3.00 1.00 1.00 5.00 1.00

3.68 5.00 1.00 4.00 5.00 1.00 3.00 1.00 1.00

2.44 3.00 1.00 2.00 3.00 1.00 1.00 3.00 1.00

4.32 5.00 5.00 4.00 5.00 3.00 3.00 3.00 3.00

4.68 5.00 5.00 5.00 5.00 5.00 3.00 5.00 3.00

3.48 4.00 3.00 2.00 4.00 1.00 3.00 5.00 1.00

3.40 4.00 1.00 2.00 4.00 5.00 3.00 1.00 3.00

4.06 5.00 3.00 4.00 4.00 5.00 3.00 3.00 3.00

STRATEGY Client value proposition and vision Planned enhancements Plans for geographic growth Investment to support strategy

50% 30% 25% 20% 25%

4.25 5.00 4.00 5.00 3.00

3.50 4.00 5.00 4.00 1.00

2.70 2.00 3.00 3.00 3.00

4.80 5.00 5.00 4.00 5.00

4.30 4.00 5.00 3.00 5.00

3.40 5.00 3.00 2.00 3.00

4.25 5.00 4.00 5.00 3.00

3.15 4.00 4.00 1.00 3.00

3.95 4.00 4.00 5.00 3.00

3.35 3.00 4.00 1.00 5.00

MARKET PRESENCE Service market presence Financial strength Client base Employees dedicated to infrastructure management Total employees

0% 40% 30% 15% 10%

2.58 2.00 2.60 3.00 3.00

1.65 1.32 2.40 1.00 1.00

2.88 2.30 2.20 5.00 5.00

2.09 1.83 2.20 3.00 1.00

0.73 0.51 1.60 0.00 0.00

3.14 4.34 2.00 1.00 5.00

4.46 5.00 3.20 5.00 5.00

2.67 3.01 2.40 3.00 3.00

1.73 2.35 1.80 1.00 1.00

3.45 4.02 2.80 3.00 3.00

5%

5.00

3.00

1.00

3.00

1.00

3.00

5.00

0.00

0.00

5.00

All scores are based on a scale of 0 (weak) to 5 (strong). Source: Forrester Research, Inc.

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

IBM

Infosys

LogicaCMG

Perot Systems

Satyam

T-Systems

TCS

Unisys

Wipro

Figure 5 Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 ’07 (Cont.)

Forrester’s Weighting

12

CURRENT OFFERING Global delivery model Geographic staffing distribution Staff transfer experience Implementation capability Clients on implementation Clients on account management Clients on service quality Clients on general satisfaction

50% 30% 4% 4% 30% 6% 8% 10% 8%

3.94 5.00 5.00 5.00 4.00 3.00 1.00 5.00 1.00

3.56 4.00 1.00 3.00 2.00 5.00 5.00 5.00 5.00

3.16 4.00 1.00 5.00 2.00 5.00 1.00 5.00 3.00

3.90 4.00 1.00 4.00 3.00 5.00 5.00 5.00 5.00

1.60 3.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00

2.32 3.00 1.00 3.00 1.00 1.00 5.00 1.00 5.00

3.80 5.00 1.00 2.00 3.00 5.00 3.00 5.00 3.00

4.10 5.00 5.00 5.00 2.00 5.00 5.00 5.00 5.00

3.14 4.00 1.00 1.00 3.00 3.00 3.00 3.00 3.00

STRATEGY Client value proposition and vision Planned enhancements Plans for geographic growth Investment to support strategy

50% 30% 25% 20% 25%

3.35 4.00 2.00 2.00 5.00

3.70 3.00 3.00 4.00 5.00

3.15 5.00 4.00 2.00 1.00

3.45 3.00 4.00 4.00 3.00

1.90 2.00 1.00 4.00 1.00

4.05 4.00 4.00 3.00 5.00

4.55 5.00 4.00 4.00 5.00

3.15 5.00 2.00 2.00 3.00

4.80 5.00 5.00 4.00 5.00

MARKET PRESENCE Service market presence Financial strength Client base Employees dedicated to infrastructure management Total employees

0% 40% 30% 15% 10%

4.46 5.00 3.20 5.00 5.00

1.15 0.84 2.20 0.00 0.00

1.14 1.35 1.00 1.00 1.00

1.02 1.34 1.60 0.00 0.00

1.30 0.51 2.00 3.00 0.00

3.33 3.13 2.60 5.00 5.00

1.66 1.50 2.20 1.00 0.00

1.50 1.50 2.00 0.00 3.00

3.26 3.34 2.40 5.00 3.00

5%

5.00

3.00

1.00

0.00

1.00

1.00

5.00

0.00

3.00

All scores are based on a scale of 0 (weak) to 5 (strong). Source: Forrester Research, Inc.

SERVICE PROVIDER PROFILES Leaders: Accenture And EDS Along With Some India-Based Firms And Perennial Favorites

· Accenture. Accenture demonstrated an excellent current offering, rewarded by reference clients

who gave the company solid marks. Its global delivery model and implementation capability — built on a consulting foundation — were also quite strong. Accenture’s history as a consulting group and its desire to be highly selective in doing asset-intensive deals lead to a business model that differentiates the provider from asset- and technology-heavy legacy multinational firms like HP and IBM. With a solid strategy and good financial strength, Accenture’s finish as a Leader in this Forrester Wave suggests that its business model is working.3

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The Forrester Wave™: Global IT Infrastructure Outsourcing, Q2 2007 For Sourcing & Vendor Management Professionals

· Capgemini. Capgemini entered the Leaders band by balancing a strong current offering with a

solid strategy for future growth in the infrastructure business. It is clearly moving in the right direction regarding global delivery and implementation capability, and its offering will get stronger as it expands its delivery footprint more aggressively, particularly in North America. With 13% growth in the infrastructure business, the financial condition of the firm has also been improving of late, and if the trend continues, Capgemini could see solid infrastructure business performance over the next several quarters.4

· CSC. With a broad global distribution and capability and a solid set of methodologies and

experience in implementing infrastructure outsourcing deals, CSC had one of the top scores for its current offering; stronger reference client scores would have placed CSC even higher. The firm’s relatively modest 4% growth in the infrastructure business suggests a capability that exceeds the traction that it is getting in the marketplace. Clients could be reacting to this past year’s takeover rumors or to the fairly average articulation of a future strategy in this space.5

· EDS. As befitting its long history of success in the infrastructure outsourcing business, EDS

topped the field overall and in the current offering scoring category. With one of the broadest market footprints, EDS’s methods for delivery and implementation have been forged and refined in the crucible of some of the most complex real-world outsourcing deals, and reference client scores rewarded this EDS capability. Also, in accordance with tradition, EDS was less strong, but still solid, in articulating and investing in a strategy for continued success in the infrastructure business. Are there any weaknesses to the EDS juggernaut? With a scant 2% net operating margin, its corporate profitability is among the bottom of all the providers in this study. Its financial performance has certainly moved up over recent quarters, but it needs to demonstrate sustained capability to generate shareholder value against the pending onslaught by smaller but rapidly growing India-based service providers.6

· HCL. Considered by some to be a tier two India-based service provider (based solely on size),

HCL received balanced, solid scores across all current offering and strategy criteria, including reference client scores, to break into the Leaders band. Although relatively smaller than the other providers in terms of corporate revenue and number of employees, HCL has multiple delivery sites in India as well as in Belfast, Northern Ireland, and Kuala Lumpur, Malaysia, and the firm distinguished itself against many players by having a more targeted strategic focus on infrastructure management and a growing service market presence.7

· HP. Although infrastructure services account for only about 5% of HP’s $91.7 billion in total

revenue, the provider has relatively strong infrastructure outsourcing delivery across all criteria to place it in the Leaders band. HP rightfully frames a global delivery strategy — balanced with local presence — as being fundamental to its infrastructure business. As befitting a major infrastructure service provider, HP has a presence in dozens of countries, and many are linked

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by common process standards. The attraction of HP’s infrastructure offering will be stronger for clients that want to benefit from all of HP’s product and service lines of business, but HP clearly has a market-leading offering for enterprise clients seeking infrastructure services.8

· IBM. With 356,000 employees and $24.1 billion in 2006 infrastructure revenue, IBM is the

“curve breaker” for size in this study. IBM’s strength in its current offering puts it in a solid leadership position, and the company tied with EDS for market presence in the infrastructure space; however, lower reference client scores kept it from a higher overall ranking. One of IBM’s key points of differentiation is its massive global footprint with 40 global delivery centers and 70 regional sites. Process maturity is also a hallmark of the IBM offering. IBMers helped “write the book” on ITIL standards, and the firm has a collection of standard tools, processes, and requirements — called the Global Solution Architecture Repository — that helps “industrialize” transformation activities.9

· Infosys. Perfect reference client scores and a solid strategy for future infrastructure business

helped land India-based Infosys in the Leaders band. Although its current offering and strategy are good, Infosys had among the lowest scores in overall service market presence in the infrastructure space. The provider has a broad global delivery footprint with 10 relatively small operations centers across Australia, China, the Czech Republic, and the UK — and across the US in Boston; Dallas; and Fremont, Calif. Infosys is beginning to articulate the true value of its global delivery model in its infrastructure management business, but it is not yet on par with its massive applications capability.10

· Perot Systems. With 3,400 employees dedicated to infrastructure services, Perot Systems

is the smallest firm to earn a position on the Leaders band. Perot Systems rightly positions itself for success in multiprovider environments and is more tightly targeting certain vertical markets (e.g., healthcare, manufacturing, government) rather than trying to be all things to all infrastructure clients. Perot has an infrastructure delivery presence in the US, UK, and India, so good delivery breadth, along with perfect reference client scores, an excellent strategy for the future, and a well-articulated value proposition resulted in a strong placing for the provider.11

· TCS. The ascension of India-based service providers in the infrastructure space is now led

by TCS. Although smaller in overall market presence than many of the other providers, including smaller HCL, excellent client scores, a solid articulation of the value of the global delivery imperative, and a first-rate strategy for future dominance landed TCS in the Leaders band. As with other top providers, TCS has a strong process and quality foundation, and the firm has rapidly grown its global infrastructure-delivery model in recent years to focus on remote delivery from India, China, Hungary, Brazil, and Uruguay. TCS also has a nearshore delivery capability in the US (Phoenix and New Jersey), UK (Guildford and Peterborough), and Luxembourg. TCS needs now to continue its trajectory to gain required scale, but the firm is well-positioned to leverage strong capability over the next several quarters to make an even more competitive run against traditional IT infrastructure powerhouses.12

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· Unisys. A corporate net margin of almost -5% suggests financial weaknesses that could plague

Unisys in the future, but the provider had excellent current offering scores — driven by perfect client reference scores — that balanced out a lackluster future strategy to place it inside the Leaders band. With 25 Managed Services Centres globally, including new facilities in India, China, Hungary, Brazil, and Colombia, Unisys is clearly betting the future on the success of its global delivery model.13

· Wipro. India-based IT giant Wipro has a broader market presence than the other India-based

firms included here, and it landed into the Leaders band. Wipro was a pioneer in the Indiabased remote infrastructure service market, and now it has Global Command Centers located in the US, UK, and the Middle East in Dubai — as well as multiple sites within India. Although solid across its current offering and in its forward-looking strategy for the infrastructure, a lack of standout client reference scores or superiority in current delivery kept Wipro back a bit.14

Strong Performers: EMEA-Based Firms With ACS And Cognizant

· ACS. ACS barely missed earning a leadership position in the global IT infrastructure

outsourcing space. The firm clearly has a solid current offering and its strategy was good (although underfunded), but its overall score just wasn’t enough for it to attain Leader status. The firm’s financial position is solid — good enough that it is now a likely target to be taken private — but ACS is still primarily a North American player; it needs to implement its current expansion strategy to be more competitive in this business space.15

· Atos Origin. Atos Origin had a modest showing with both its current offering and forward-

looking strategy. The firm’s broad footprint in EMEA confirms some solid strengths, but overall Atos Origin is limited in terms of its overall global delivery footprint, and relatively low reference client scores nearly put the firm into the Contenders band. Atos Origin needs to grow its business faster than last year’s near 3% to remain competitive in the future, particularly as India-based firms expand into EMEA.16

· Cognizant. In spite of its recent AimNet acquisition, which brought in 100 US-based full-time

employees and 80 clients, Cognizant has the smallest market presence of all the firms included in this assessment. Cognizant could be well-positioned for the future of the infrastructure outsourcing business, but the firm needs to address some reference client concerns and overall global delivery implementation capability to be able to execute against a solid strategy. Its value proposition is based heavily on its current ability to deliver onshore or offshore support for network operations centers to the Americas, and the firm has the capability to offer onshore infrastructure consulting in the Americas.17

· Getronics. Solid scores across the board position Getronics as a Strong Performer in the

infrastructure space. With only 62% of infrastructure employees in Europe, Getronics has the broadest delivery and staffing footprint globally among the EMEA-based firms. It has a

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compelling vision for infrastructure services, called the Future-Ready Workspace, and the firm works to help clients benefit from compliance with open industry standards and using products with the widest market share. The only significant gap we see is its lack of emphasis on the global delivery model as an engine for business and technical innovation, quality, and cost reduction.18

· LogicaCMG. In spite of a relatively small market presence — with the vast bulk of its workforce in Europe (85% in the UK, the Netherlands, Central and Eastern Europe, France, Sweden, Finland, and Portugal) — solid reference client scores and forward-looking strategy helped land LogicaCMG in the Strong Performers band. With a recent shift in infrastructure strategy, LogicaCMG has a strong new vision for infrastructure clients — but perhaps without sufficient funding to implement. It was among the few firms that positioned a value proposition directly against the strengths and weakness of the competition, showcased the value of a strong consultancy offering, and noted the potential of new pricing models.19

· T-Systems. Solid reference client scores and a good strategy for the future earned T-Systems

a spot on the Strong Performers band. It has a vision to be a premier infrastructure service provider in Europe by 2010. But similar to other EMEA-based firms, although it supports global IT clients, T-Systems — with 93% of its personnel in Europe and 75% in Germany — is primarily a regional player.20

Contenders: Satyam

· Satyam. Satyam did not show as much strength in the infrastructure management space

as the competitors considered here. The firm also had among the lowest service market presence scores, which suggests that although Satyam can deliver the services, infrastructure management is not part of a long-term, market-differentiating business strategy. Lower reference client scores, gaps in implementation capability, and relatively weak infrastructurespecific strategic intent put Satyam into the Contenders band.21

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SUPPLEMENTAL MATERIAL Online Resource The online version of Figure 5 is an Excel-based service provider comparison tool that provides detailed product evaluations and customizable rankings. Data Sources Used In This Forrester Wave Forrester used a combination of data sources to assess the strengths and weaknesses of each service provider:

· Service provider surveys. Forrester surveyed service providers on their capabilities as they

relate to the evaluation criteria. We held calls with several service providers where necessary to ensure complete survey responses.

· Reference client surveys. To validate product and service provider qualifications, Forrester

also conducted a total of 61 phone-based surveys of current clients of the service providers. A minimum of three valid reference client surveys was required for inclusion in the study.

The Forrester Wave Methodology We conduct primary research to develop a list of service providers that meet our criteria to be evaluated in this market. From that initial pool of service providers, we then narrow our final list. We choose these service providers based on: 1) service product fit; 2) client success; and 3) Forrester client demand. We eliminate service providers that have limited client references and services that don’t fit the scope of our evaluation. After examining past research, user need assessments, and service provider and expert interviews, we develop the initial evaluation criteria. To evaluate the service providers and their offerings against our set of criteria, we gather details of service qualifications through a combination of lab evaluations, questionnaires, demos, and/or discussions with client references. We send evaluations to the service providers for their review, and we adjust the evaluations to provide the most accurate view of service provider offerings and strategies. We set default weightings to reflect our analysis of the needs of large user companies — and/or other scenarios as outlined in the Forrester Wave document — and then score the service providers based on a clearly defined scale. These default weightings are intended only as a starting point, and readers are encouraged to adapt the weightings to fit their individual needs through the Excel-based tool. The final scores generate the graphical depiction of the market based on current offering, strategy, and market presence. Forrester intends to update service provider evaluations regularly as product capabilities and service provider strategies evolve.

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ENDNOTES 1

Source: US Central Intelligence Agency’s World Factbook ranking of GDP at https://www.cia.gov/library/ publications/the-world-factbook/rankorder/2001rank.html.

2

Two leading providers did not meet all of the selection criteria because of how they classify their business, but we added them because of their market position in the infrastructure management outsourcing space.

3

View the vendor summary for more detailed analysis on how Accenture fared in this evaluation. See the June 14, 2007, “Accenture Is A Leader In Global IT Infrastructure Outsourcing” report.

4

View the vendor summary for more detailed analysis on how Capgemini fared in this evaluation. See the June 14, 2007, “Capgemini Is A Leader In Global IT Infrastructure Outsourcing” report.

5

View the vendor summary for more detailed analysis on how CSC fared in this evaluation. See the June 14, 2007, “CSC Is A Leader In Global IT Infrastructure Outsourcing” report.

6

View the vendor summary for more detailed analysis on how EDS fared in this evaluation. See the June 14, 2007, “EDS Is A Leader In Global IT Infrastructure Outsourcing” report.

7

View the vendor summary for more detailed analysis on how HCL fared in this evaluation. See the June 14, 2007, “HCL Is A Leader In Global IT Infrastructure Outsourcing” report.

8

View the vendor summary for more detailed analysis on how HP fared in this evaluation. See the June 14, 2007, “HP Is A Leader In Global IT Infrastructure Outsourcing” report.

9

View the vendor summary for more detailed analysis on how IBM fared in this evaluation. See the June 14, 2007, “IBM Is A Leader In Global IT Infrastructure Outsourcing” report.

10

View the vendor summary for more detailed analysis on how Infosys fared in this evaluation. See the June 14, 2007, “Infosys Is A Leader In Global IT Infrastructure Outsourcing” report.

11

View the vendor summary for more detailed analysis on how Perot Systems fared in this evaluation. See the June 14, 2007, “Perot Systems Is A Leader In Global IT Infrastructure Outsourcing” report.

12

View the vendor summary for more detailed analysis on how TCS fared in this evaluation. See the June 14, 2007, “TCS Is A Leader In Global IT Infrastructure Outsourcing” report.

13

View the vendor summary for more detailed analysis on how Unisys fared in this evaluation. See the June 14, 2007, “Unisys Is A Leader In Global IT Infrastructure Outsourcing” report.

14

View the vendor summary for more detailed analysis on how Wipro fared in this evaluation. See the June 14, 2007, “Wipro Is A Leader In Global IT Infrastructure Outsourcing” report.

15

View the vendor summary for more detailed analysis on how ACS fared in this evaluation. See the June 14, 2007, “ACS Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

16

View the vendor summary for more detailed analysis on how Atos Origin fared in this evaluation. See the June 14, 2007, “Atos Origin Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

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17

View the vendor summary for more detailed analysis on how Cognizant fared in this evaluation. See the June 14, 2007, “Cognizant Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

18

View the vendor summary for more detailed analysis on how Getronics fared in this evaluation. See the June 14, 2007, “Getronics Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

19

View the vendor summary for more detailed analysis on how LogicaCMG fared in this evaluation. See the June 14, 2007, “LogicaCMG Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

20

View the vendor summary for more detailed analysis on how T-Systems fared in this evaluation. See the June 14, 2007, “T-Systems Is A Strong Performer In Global IT Infrastructure Outsourcing” report.

21

View the vendor summary for more detailed analysis on how Satyam fared in this evaluation. See the June 14, 2007, “Satyam Is A Contender In Global IT Infrastructure Outsourcing” report.

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