Cognizant—HFS Top 10 Infrastructure and Enterprise Cloud Services 2018

HFS Top 10 Infrastructure and Enterprise Cloud Services 2018

0537511d “Traditional infrastructure revenues are in freefall as cloud and as-a-service models take over.” –Jamie Snowdon, Chief Data Officer

0537511d What you’ll read

Topic Page

Introduction 4

Research methodology 6

Provider profiles 16

Hyperscale provider profiles 35

Market direction and recommendations 39

Survey respondent demographics 44

0537511d Introduction

• The infrastructure services market continues to converge with other IT service areas, particularly application services—blurring definitions and forcing enterprises and providers to shift the way they build out deals. • Hyperscale cloud providers continue to impact the market, although enterprises are recovering from the erosion in market share by building out brokerage services and putting forward visions for richer hybrid cloud environments as platforms for wider, process-centric digital transformation. • Hybrid cloud takes up a significant portion of mindshare, with as much as 75% of some providers’ engagements comprising hybrid cloud elements. • Greater clarity around the role of infrastructure and enterprise cloud services as a foundation for digital transformation is leading to strong growth for some providers. • Nevertheless, the industrializing effect of cloud is continuing to erode overall revenues—greater utilization of existing assets through cloud providers means that fewer assets need to be purchased and managed and that some infrastructure spending is embedded within application services. • Talent is becoming a battleground but not in the traditional sense. The demand for high-quality cloud talent is leading to a war between major IT service providers and the cloud giants—AWS, Google, and Microsoft—in some instances putting a strain on already challenging partnerships. • Partnerships with the biggest cloud providers are broadening. More firms are forming and deepening partnerships with Google, for example, as enterprise clients become more prescriptive in the type of cloud provider they are willing to work with, especially as opinions are formed about the relative strength of each provider as a platform for value-lever technologies such as IoT, AI, and analytics.

0537511d The Digital OneOffice Framework is the end-state vision for

transformation Infrastructure and enterprise cloud services have an important role to play in the future of the modern digital organization. In the HFS Digital OneOffice concept, the digital underbelly is reliant on the cloudification of processes, IT, and software, alongside other important aspects that are reliant on solid infrastructure foundations, such as security and automation. As a result, more enterprises are taking a hard look at their digital underbelly and are sourcing deals that will help them build a foundation necessary for sustainable transformation activities.

0537511d Research methodology

This Top 10 research is based on interviews with 300 enterprise clients of IT services from the Global 2000 in which we asked specific questions pertaining to innovation and execution performance of service providers assessed. The research is augmented with information collected in Q1 and Q2 2018 through provider RFIs, structured briefings, client reference interviews, and from publicly available information sources.

IT Services providers were assessed on the following three main dimensions:

33.3% 33.3% 33.3% Voice of the buyer Ability to execute Innovation capability

• Candid feedback from client • Scale and breadth • Vision and methodology references and the results • Cloud capability • Automation and cloud strategy from the IT Services customer survey. • Partnering and IP

0537511d Providers covered in this report

0537511d Executive summary

• The infrastructure services market has had a turbulent few years. Traditional forms of infrastructure management services underpinned much of the growth in the outsourcing and broader IT services industry. But with the inevitable rise of as-a-service and cloud computing, these safe harbors are safe no more. The major IT service providers assessed in this report have been forced to rethink their approach in the space and figure out how to shift their commercial models to accommodate trends, such as utility-based pricing, and the continuing encroachment of the hyperscale cloud providers. • Furthermore, the shift away from deals comprising specific IT components and toward outcome-focused engagements is concurrently moving the focus away from infrastructure and toward other areas of the IT value chain, most notably business applications. Enterprises are less enamored with selecting a particular data center but instead want to outsource the whole process: “Here’s the app we want built, hosted, and managed. Off you go!” For infrastructure service lines, this has forced a rethink—and for providers as a whole, engagement channels are being rerouted to better meet the direction enterprises want to go in. • Simply put, this means crunch time for a lot of providers in the space. Those that are siloed, or too committed to forcing traditional models down the throats of clients, will be swept away on the wave of as-a-service. Those that are nimbler and able to guide clients across their whole organization are the most likely to succeed. Enterprise technology is far more complicated and complex than ever it was before—clients need partners to help guide them through, and, sometimes, to realize that while they’ve approached them for “lift and shift” what they really need is staggered cloud migration to get the outcome they need.

0537511d Major trends impacting the market

The infrastructure and enterprise cloud services market is evolving and transitioning from a period of considerable change. Hyperscale cloud providers have challenged the superiority of the leading IT players, with some taking solace by leveraging broader management capability with hybrid brokerage models. Meanwhile, the enterprise drive for cloud services is causing its own challenges, with a fresh war for high-quality cloud talent shaping up in the space. Many of these trends are only starting to take shape, while others are firmly embedded and forcing the market to adapt. • Hyperscale cloud challengers: The three largest hyperscale cloud providers—AWS, Google, and Microsoft—are by no means new entrants to the market. They have been on the radar of the large IT services players for many years. However, increased demand for scalable enterprise cloud capabilities is driving more revenue and market share into the hands of these three giant players. Moreover, each of these firms is now beginning to implement their own differentiation strategy, building out capabilities that businesses need for future growth—a move that will no doubt deliver even greater market share. This poses a problem for the major IT services players—the demand for these capabilities is focused; it’s not something they can challenge directly. So, from an infrastructure perspective, business models and engagement strategies need to shift considerably. • Brokerage models take off: With such focused demand, and often a general inability for the market to provide challenger services, many IT providers are committing to develop their approaches to service brokerage. While not a new approach, there is a marked increase in the number of providers looking to expand and deepen partnerships to enable them to fully embrace the model. In the year since the first infrastructure and enterprise cloud Blueprint was published, the number of firms partnering with Google, as an example, has increased dramatically. This is a significant development because while many firms partnered with AWS and Microsoft, the market is continuing to shift in favor of hyperscale industrialized cloud capabilities—pushing firms to look beyond their traditional partners and connect with firms that their clients are asking for. The saving grace for many firms in this space is the lack of commitment from the big three to move into the professional services space. Neither Google, AWS, nor Microsoft has shown any real commitment to take on the major providers at their own game in professional services, from selection to implementation. Instead, they are leaving their partners to take on this large segment of work and simply providing the commoditized products and services.

0537511d Major trends impacting the market (2)

The brokerage paradox: But all is not rosy in the brokerage camp. Enterprise clients seem to have mixed feelings about the need for another link in the chain. The most mature IT departments are increasingly going to the major providers directly, something which the AWS business model lends it to—lower levels of capacity can be procured with a credit card, instead of lengthy procurement processes necessary for larger selection and brokerage deals. Many clients have advised us that they see brokers as a weak link in the chain, something that will inevitably move too slow for their needs. Others view it as a necessary evil—their environment is too complex for them to handle or they lack the skills and knowledge of key trends in the market. By and large, however, brokers seem to be held in high regard. Enterprises no longer want to get bogged down in the intricacies of a deal, they want expert help to pick the capabilities they need. A large volume recognizes they will need an agile and flexible multi-cloud environment and need the help of a large provider to get them a good deal. Usually, this happens because they require the high-quality talent that the leading IT providers can bring. The issue has also been getting access to full range of cloud services via brokerage and hybrid cloud platforms—avoiding the platform becoming the lowest common denominator solely focused on virtual machines, and storage units rather than enabling the use of more advanced services from hyperscale providers. Talent war shapes up: It’s on this final point that the most potential impact sits. The quest for high-quality talent of any kind in the current market is creating small battlefields as enterprises and providers fight to get the cream of the crop. The same is true with cloud—multiple clients advise that the reason they have pushed for infrastructure services support is that they do not have the talent internally. But, perhaps the most interesting trend is the number of enterprises and providers alike that are advising they are struggling to compete for talent with the main cloud providers. Google, Microsoft, and AWS are attracting key talent from many of the areas the leading providers would have had first pick, causing challenges currently that will no doubt become major sticking points in the future. Should the talent war become more acute, it is highly likely it will put strains on existing partnerships and force providers to rethink their attraction and retention programs.

0537511d Traditional infrastructure in freefall as cloud and as-a-service take over Infrastructure and enterprise market sizing forecast $130B CAGR 2017 -2022 » Traditional revenues are in freefall and are estimated fall by more than a half $120B over the next four years. $33B $110B $46B $57B » As-a-service and cloud revenues are $100B $68B OneOffice 21.6% expected to grow and bring in enough $90B $78B $88B revenue to fill this gap. $80B » Overall, the market size is unlikely to $70B increase or decrease in value $60B significantly; depreciation in traditional

$50B $95B revenues will be replaced by growth in $85B

Annual Expenditure ($Bn) $40B $74B as-a-service and cloud. $30B $63B $53B Traditional -15.1% $20B $42B $10B

2017 2018 2019 2020 2021 2022

Source: HfS Research

0537511d Enterprises are looking to invest heavily in cloud capabilities

How much investment/focus is your organization making in the following in the next year to help you achieve operational cost saving goals? » A large percentage of enterprises are putting significant investment focus on Significant investment/focus Some investment/focus the cloud.

RPA 53% 28% 14% 5% » Forty-four percent of enterprise Cloud 44% 36% 14% 6% executives advises they are putting a significant focus on investing in the Internet of Things… 42% 35% 18% 5% cloud, with 36% placing some emphasis on the technology. Analytics 37% 41% 18% 4%

Virtual and… 33% 30% 20% 18% » Only RPA is seeing greater Blockchain 33% 40% 23% 4% commitments to investment than the cloud. AI/ML/Cognitive 33% 48% 14% 5%

Drones 19% 37% 20% 24%

Driverless Vehicles 16% 32% 22% 31%

0537511d Research summary highlights

Highlight #1: Cloud investment is at an all-time high Enterprise executives are investing heavily in cloud capabilities, accelerating the growth of the major hyperscale players, and the demise of traditional providers.

Highlight #2: The traditional market is in freefall Traditional infrastructure services are continuing their freefall as enterprises look to the cloud and the as-a-service model for scalable, flexible, and cost effective services.

Highlight #3: There are major growth opportunities for providers Providers building cloud strategies that resonate with the modern enterprise are driving considerable market growth, fuelled by an insatiable appetite for cloud as a foundation for digital transformation.

Highlight #4: Partner ecosystems continue to deepen The number of providers that now hold strategic partnerships with the major hyperscale providers and an ecosystem of smaller players to help drive the services has increased enormously as enterprises push for end-to-end brokers.

0537511d HFS Top 10 infrastructure and enterprise cloud services 2018 Execution Innovation Voice of Customer

#1 IBM IBM continues to bring major cloud and automation capabilities #2 Accenture Strong credibility as transformation partner #3 Cognizant Compelling hybrid cloud narrative #4 Atos Compelling hybrid cloud narrative #5 HCL Trusted Infrastructure with strong automation drive #6 TCS Trusted provider with a global delivery capability #7 Infosys Highly evolved capabilities in the space #8 DXC Leviathan provider offering considerable scale #9 Unisys Security focused provider, with strong ITSM credibility #10 Wipro Strong brokerage credentials focusing on “cloud-only” #11 NTT DATA Trusted infrastructure provider, but needs a clearer narrative #12 Capgemini Strong technical consulting capabilities #13 Fujitsu Legacy of delivery, but needs to prove innovation capabilities #14 Genpact Smaller and agile player - holds a lot of trust in certain verticals #15 Tech Mahindra Competing with rivals with DevOps and hybrid cloud narrative #16 CGI Outcome focused provider, but need clearer vision #17 Syntel Pure-play broker bringing cloud providers to client engagements #18 Hexaware Asset-light firm committed to brokerage model

Source: HFS Research 2018

0537511d HFS top five products by individual assessment dimensions

Ability to execute Innovation capability HFS Voice of the customer Ranking Vision and Automation and cloud Scale and breadth Cloud capability Partnering and IP methodologies strategy

Source: HFS Research, 2018

0537511d Provider profiles

0537511d IBM: Big Blue continues to bring major cloud and automation capabilities to deals Dimension Rank Strengths Opportunities • Trusted provider with a strong track record: From an enterprise trust • Challenges with size: Size brings challenges, and for IBM this means HFS Top 10 position #1 perspective, clients highlight IBM as one of the biggest safe ports they can difficulties navigating among the different service lines and siloed anchor in to support them on their infrastructure-transformation journey. capabilities. Ability to execute • Cloud capability: IBM stands alone in the pool of providers because it has • Competition from hyperscale cloud: While IBM can leverage its form the assets to stand among the hyperscale cloud providers. of hyperscale cloud capability, this presents challenges—specifically • Developing next-generation commercial models: IBM has been quick to difficulty forming deep partnerships and pushing a vendor-neutral Scale and breadth #1 respond to changing demands in the infrastructure and enterprise cloud narrative. space by adjusting commercial models. • Mixed financial performance. Part of the stability of an organization Cloud capability #1 • Strong proprietary automation engine: As the home of IBM Watson, the is its ability to have a sustainable business model—particularly with firm can push automation capabilities in new and existing engagements to large, long-term transformational deals. IBM has struggled to find levels beyond what many of its competitors are capable of. growth for its infrastructure business. Partnering and IP #6 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: • Total headcount: 397,800 • Digital: Apple, Cisco, Citrix • Data center locations: US, Mexico, Brazil, UK, Portugal, Spain, Italy, • Cloud: VMware, Box, Amazon, Microsoft, Google, Akamai, DXC, HCL Netherlands, Germany, India, China, Hong Kong, Singapore, Australia, Vision and • #2 Analytics: Juniper Networks, Twitter, Facebook Japan, Argentina, Costa Rica, Czech Republic, Hungary, Poland, • Service management: ServiceNow, Rittal, Schneider Electric, CA, CAST methodology Romania, South Africa, Malaysia, and the Philippines • Automation: IPSoft, Blue Prism, Automation Anywhere Automation and • Mobility: Apple, Microsoft, ServiceNow, Citrix, VMware, Lenovo, Zebra, #2 MOBI, Druva, JAMF, MobileIron, AirWatch • Key clients include: Sysco, BNSF Railway Co., Etihad Airways, EVRY, cloud strategy Fortis Healthcare, BRF S.A., Danske Bank, Atlanta Falcons Acquisitions: 2017: Ravy Technologies, Agile 3 Solutions, Cloudigo Ltd. Voice of the (Cloudigo); 2016: Sanovi Technologies, Promontory Financial Group, The #1 Weather Company, EZSource, Resilient Systems, Iris Analytics; 2015: customer Clearleap, Cleversafe, Gravitant, Strongloop, Compose, Bluebox, Blekko, AlchemyAPI; 2014: Lighthouse Security Group, CrossIdeas, Cloudant

0537511d Accenture: Strong credibility as a infrastructure transformation partner Dimension Rank Strengths Opportunities • Strong cloud-first narrative: Accenture has built a compelling vision for • Wrestling with high expectations: Accenture continues to wrestle HFS Top 10 position #2 cloud in the modern enterprise, pushing a narrative that places enterprise with often unrealistically high expectations from clients. This often cloud as the platform for digital transformation work. hampers some satisfaction levels from clients who expect solutions Ability to execute • Track-record of transformative work: Accenture has one of the most far in advance of what the firm’s competitors have on offer. evident track records of using infrastructure and enterprise cloud as a • Pricing turn-off for some clients: The price tag for engagements is a weapon in its arsenal for transformative work. turn-off for some clients. Many have told us that Accenture is usually Scale and breadth #6 • Innovation roadmap supported by thought leadership: Accenture’s on their shortlist of preferred vendors but often needs to be cut or innovation roadmap is backed by real research and thought leadership. have the remit of the engagement scaled down due to affordability. Cloud capability #5 • Developing outcome-oriented deals: Accenture has articulated that deals Accenture is addressing these challenges with new pricing options in the space continue to focus on the outcome. such as “percent of spend” where rates are driven by level of service • Developing cloud factories: Accenture continues to invest in the space and and calculated as a percent of the public cloud capacity compute and is working to drive more competitive deals. storage spend. Partnering and IP #8 Acquisitions and partnerships Operations and key clients Innovation capability • Cloud: Amazon Web Services, Microsoft Azure, Google, SAP, Oracle Cloud • Infrastructure services FTE headcount: 38,000 • Data center and server management: VMware, HPE and Red Hat • Australia, Brazil, UK, France, Germany, • End-user workplace management: Microsoft, Citrix, VMware, Dell, HPE Data center locations: Vision and India, Italy, Philippines, Spain, USA #1 • Network management: Cisco, HPE, VMware, Nokia methodologies • PaaS: Docker, Alibaba, Tencent, Pivotal, Cloud Foundry, Microsoft Azure, • Delivery center locations: Brazil, Canada, India, Philippines, OpenShift USA • ServiceNow Automation and Service management: #1 • Automation: Ansible, Puppet, Chef Cloud strategy • Analytics: Cloudera, HPE, Tableau, Splunk Key clients include: Accenture, Avalon Health Care, Banc, Sabadell, GRTgaz, Hess, Mercedes, Talen Energy, Towergate Acquisitions: 2017: Arismore, Concrete Solutions, Focus Group Europe, Media Hive, Voice of the Phase One, Solid-serVision; 2016: CRM Waypoint, DayNine, Defense Point Security #2 (US-Federal), Maglan (Israel), Redcore, Nashco, New Energy Group; 2015: Agilex, customer Cloud Sherpas, EnergyQuote JHA, Fusion X, Solium, Tquila UK, Vlocity; 2014: Enkitec

0537511d Cognizant: Strong capabilities but clearer vision needed

Dimension Rank Strengths Opportunities • Global infrastructure footprint: Cognizant can bring considerable scale and • Growing demand for hyperscale brokerage: Clients have advised that HFS Top 10 position #3 reach to infrastructure and enterprise cloud engagements. they are increasingly looking for engagements with service providers • Verticalized specialism: Cognizant aims to bring a unique vertical flavor to that broker deals with major hyperscale cloud providers. While Ability to execute engagements and has been building out capabilities specific to key Cognizant has partnerships with key players, there are some firms, industries. such as Google, that the market is showing an increased appetite for • Pricing flexibility: Cognizant continues to offer infrastructure services that Cognizant is not working with through a strategic partnership. Scale and breadth #7 clients the opportunity to work through a commercial model that suits • Thought leadership and vision: The infrastructure and enterprise them. cloud space is becoming a key battleground for IT services firms, Cloud capability #8 • Building automation savings into deals: Cognizant advises that it is more which is driving the level of marketing activity and thought leadership regularly in discussions with its customers on the potential of building in the space. automation savings and efficiencies in deals. Partnering and IP #16 Acquisitions and partnerships Operations and key clients Innovation capability • Infrastructure and cloud: Microsoft, Dell EMC, Cisco, NetApp, AWS, • Infrastructure services FTE headcount: 28,000 VMware, Nutanix, Red Hat, Pivotal, Hitachi, ServiceNow, Hewlett Packard, • Delivery center locations: India, US, Philippines, UK, Hungary, Vision and Docker, PureStorage Singapore #4 • Technology partners: Ayehu, CA Technologies, SnapLogic, Rancher, Zenoss, Chef, BMC, Dynatrace, Citrix methodology • Key clients include: international hotel and resort chain based in the United States, international industrial service provider, British Automation and Acquisitions: 2016: Kbace, Frontica Business Solutions, KIS Information multinational energy and services company, American global #7 Services; 2014: Trizetto Corporation cloud strategy telecommunications conglomerate, British multinational information and analytics company, American multinational technology company Voice of the #3 customer

0537511d Atos: Compelling hybrid cloud narrative

Dimension Rank Strengths Opportunities • Strong hybrid narrative: Atos has come to market with perhaps one of the • Investment in automation: Clients have advised that in their HFS Top 10 position #4 strongest narratives for the hybrid model. engagements, Atos’ automation capabilities have progressed • Growing partnerships with hyperscale cloud players: Atos has recently somewhat slower than planned. Unlike some of its competitors, Atos Ability to execute announced a partnership with Google, meaning it now has partnerships has not invested in proprietary automation capabilities—however, with all major hyperscale players. through partnerships and the Atos Codex platform, the firm can bring • Scale and breadth #11 Orchestration capabilities: Atos has invested considerably in the in automation capabilities when necessary. orchestration capabilities of its infrastructure and enterprise cloud • Lack of broader consulting skills: Atos consulting skills are strong offerings. technically but unbalanced across regions for business consultants, Cloud capability #7 • One Atos Voice: The firm is committed to drive consistency across its which means they may struggle to roll out similar services business and bring a single coherent voice to customers. consistently, particularly outside of Europe.

Partnering and IP #2 Acquisitions and partnerships Operations and key clients Innovation capability • Global strategic partners: Siemens, DellEMC • Infrastructure services FTE headcount: 47,000 • Cloud: ServiceNow, Apprenda, EMC, VMWare, AWS, Microsoft Azure, Cloud • Atos DC footprint spans five continents Foundry.org, Red Hat, Google Data center locations: Vision and in 31 countries; Atos has over 100 data centers including eight #5 • Analytics: Clickfox, Nexthink methodologies • Monitoring and event management: BMC, CA cloud hubs providing Tier 1 levels of service quality and security • Virtual agent: Living Actor Solutions for both traditional and digital services. • Automation and Service management: ServiceNow #3 • Automation and AI: IPSoft, Cognicor cloud strategy • Workplace: Intel, Genesys, Microsoft, Citrix, Xerox and VMWare • Key clients include: GasTerra, government of Western • Collaboration: Microsoft, Syncplicity, Unify, Google, Box, Salesforce, ShareFile Australia, McGraw Hill Education, Rio 2016 (Olympics), Safran, Voice of the Siemens, Société Générale, Solvey, Texas DIR #5 Acquisitions: 2018: Syntel; 2017: Data; 2016: Engage ESM, Anthelio Healthcare; customer 2015: Unify, Xerox ITO, Cambridge Technology Partners; 2014: Bull

0537511d HCL: Trusted Infrastructure with strong automation drive

Dimension Rank Strengths Opportunities • Strengthening infrastructure business: HCL continues to post strong • Vision and thought leadership: On the whole, clients rated HCL’s HFS Top 10 position #5 financial growth amidst the development of its infrastructure offerings. ability to deliver in the infrastructure and enterprise cloud space • Investment in verticalized capabilities: HCL is continually developing highly. However, the firm loses ground somewhat when it comes to Ability to execute capabilities in particular industry verticals, including the creation of vision and thought leadership. Clients have advised that while HCL engineering labs and centers of excellence in areas such as industrial has some compelling thought leaders, this is not always consistent Scale and breadth #3 design, high-performance computing, and automation. across the organization and a clearer vision for the IT services space • Segmented transformation strategy: HCL has developed a strategy (Mode would be helpful in guiding client strategy and highlighting how the 1-2-3) to support customers on their transformation. firm differentiated from competitors in the space. Cloud capability #2 • Strong automation delivery: HCL advises that the majority of infrastructure • Scale of its broader consulting skills. Although HCL has a strong focus engagements now includes considerable automation assets to drive on digital and digital transformation consulting, it’s not clear that the additional client value. scale of on-shore consultants is able to prove business value on top of its infrastructure management. Partnering and IP #5 Acquisitions and partnerships Operations and key clients Innovation capability • Cloud: IBM, AWS, Azure, Softlayer, Oracle Cloud, Vmware, Google • Infrastructure services FTE headcount: 39,500 • Hosting: Equinix, Sungard, Interxion • Data center locations: DCs in USA, Sweden, and India and 27 remote IIM Vision and • Storage and Backup: Hitachi, Netapp, IBM, Dell-EMC, HPE, Commault, centers in India, USA, Brazil, Canada, China, Czech Republic, Estonia, #3 Veritas Europe, Finland, Italy, Malaysia, Mexico, Netherlands, Ireland, Norway, methodology • Virtualisation: VMWare, Microsoft, KVM Poland, Singapore, USA • Computing: HPE, Dell-EMC, Cisco, Supermicro, Quanta • Delivery center locations: United States, Mexico, Canada, Great Britain, Automation and • Converged & Hyperconverged Infrastructure: Nutanix, Simplivity, Dell- Norway, Germany, Ireland, Finland, Czech Republic, Switzerland, France, #10 EMC, Cison, Netapp, VMware, Red Hat, OpenStack cloud strategy Netherlands, Denmark, Poland, Sweden, South Africa, UAE, Australia, New Zealand, China, Hong Kong, Japan, Malaysia, Philippines, Singapore, Acquisitions: 2018: Actian, C3iS; 2017: Datawave, Urban Fulfillment Services LLC; 2016: Volvo IT, IBM Tools, Geometric, Butler America Aerospace, Point India Voice of the • #4 to Point LTD; 2015: Concept to Silicon Systems, Trygstad, PowerObjects Key clients include: U.S. Based Information management firm, A U.S. customer University, A major health insurance firm

0537511d TCS: Trusted provider with a global delivery capability

Dimension Rank Strengths Opportunities • Outcome-focused approach to engagements: TCS’ approach to • Fueling growth: TCS continues to grow and develop its infrastructure HFS Top 10 position #6 infrastructure engagements is to identify and hone in on critical business capabilities and has announced some major wins. However, a outcomes to drive business value. challenge for many providers is attracting high-level talent in the Ability to execute • Cloud a key pillar for digital: TCS has developed a strong vision for the infrastructure and cloud space. TCS has recently brought in key talent, future of cloud as one of the key pillars in an organization’s digital but may encounter hurdles in the long-term as demand for resources transformation strategy. in the IT outsourcing space converge on particular talent pools. Scale and breadth #4 • Thought leadership: TCS’ Business 4.0 thought leadership seems to be Nevertheless, the firm has a strong brand in major geographies, resonating with the market and driving greater traction in the space. partnerships with academic institutions and has embarked on a TM Cloud capability #3 • Driving savings through automation: TCS is gaining traction with its Ignio journey to reskill and upskill its talent pool to mitigate the impact of platform with a large number of clients using the toolset. any looming talent wars in the space. • Partnerships: TCS has invested in strengthening partnerships with major providers in the space, including the large cloud providers. Partnering and IP #4 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: • Data center locations: USA, Canada, UK, Nordics, Germany, India, • Cloud and infrastructure: AWS, Microsoft Azure, Google Cloud Platform, IBM Japan, and Sweden, Cloud, Oracle Cloud, Cisco, Dell - EMC - VMware, Nutanix, Hitachi, HP(E), HP(I) Vision and • Delivery center locations: 148 delivery centers in 46 Countries #7 • Cloud management and support partners: CloudScape, DataDog, Puppet, methodology Dynatrace, CyberArk, Splunk, Qualsys, Symantec, ScienceLogic, CommVault, Platform9, Kubernetes, Pivotal, Docker, Apprenda, Mesosphere, • Key clients include: Virgin Atlantic Airline, M&G Prudential, Marks & HortonWorks, CloudEndure, CloudEra, RH Openshift, LemonGrass Spencer, Transamerica, Randstad, Malaysia Airlines, Cargill, DNB Automation and Vipps #14 • Service management and workplace services: ServiceNow, BMC, Remedy, CA cloud strategy Technologies, WWTS, SMS, Hammersbach • Automation and analytics: WorkFusion, IBM Watson, RedHat, Appian, Voice of the Alfresco, TIBCO, Blue Prism, Fico, Automation Anywhere, UiPath, K2, Pega, #16 HIRO (arago), Splunk, Microsoft, SAP, Lakeside, Teradata, Hortonworks, customer Informatica, Apigee Acquisitions: None

0537511d Infosys: Highly evolved capabilities in the space, but must talk more about innovation Dimension Rank Strengths Opportunities • Heavy investment in near-shore capabilities: Infosys has invested heavily • Building a clearer vision externally: Infosys has developed a keen eye HFS Top 10 position #7 in building out near-shore delivery centers in key geographies. for spotting improvement opportunities internally; however, it needs • Push toward outcome- and consumption-based pricing: Infosys has to articulate these. The firm needs to set its stall out in the Ability to execute developed and outcome- and consumption-based pricing models to infrastructure space and push a much clearer vision of where it sees support clients in driving more value from engagements. the infrastructure market headed and how it can support clients on • Redeveloping internal delivery: Infosys continues to redevelop internal their transformation journey. Scale and breadth #12 delivery capabilities to ensure they offer the most value to clients. • Scale of its broader consulting skills. As infrastructure services • Pushing the reskilling of talent: At a time of considerable disruption in the become more embedded within other service offerings, business Cloud capability #14 IT outsourcing space, Infosys is working to retain and retrain talent through consulting and change management credentials become more training and certification programs to help staff move from low-skill areas important. to high-skill areas, for example from administration to coding, and from ITSM to service experience transformation. Partnering and IP #9 Acquisitions and partnerships Operations and key clients Innovation capability • Key partnerships: Cisco, Juniper, HP, DellEMC, Hitachi, F5, Check Point, • Infrastructure services FTE headcount: 20,000 Symantec, Splunk, IBM, SuSe, RedHat, MongoDB, Oracle, MSFT, Google, • Data center locations: Over 100 data centers globally Vision and CyberArk, Onapsis, Equinix, SungardAS, NTT Com, Telstra • Delivery center locations: India, Philippines, Mexico, Czech Republic, #8 USA methodology Acquisitions: 2018: Wongdoody; 2017: Brilliant Basics; 2016: Tidal Scale; 2015: CloudEndure, Noah Consulting, Panaya, Skava • Key clients include: A leading European banking and financial Automation and #8 services major, an oil and gas major, a leading multi-brand retailer, a cloud strategy leading automobile giant, a leading pharmaceutical corporation Voice of the #9 customer

0537511d DXC: Leviathan provider offering considerable scale

Dimension Rank Strengths Opportunities • Global reach and scale: DXC has an almost unrivaled reach and scale in the • DXC’s path still unclear to clients: Clients advise that while DXC is HFS Top 10 position #8 infrastructure services and enterprise cloud space, offering access to over beginning to settle after a series of major acquisitions and mergers, 90 global data centers supported by over 80,000 professionals. the future of the company and its vision for its infrastructure and the Ability to execute • Trusted delivery partner: Multiple DXC clients advised that they viewed enterprise cloud space is still somewhat unclear. Clients also advise the firm as a trustworthy and consistent delivery partner, capable of there are challenges with branding consistency across the company, Scale and breadth #2 bringing quality and highly scalable services to support them on their with some unsure if they are part of DXC or with CSC. transformation journey. • Mixed financial performance to date. Part of the stability of an • Track record of delivery: DXC, through its constituent parts, has an organization is its ability to have a sustainable business model. DXC’s Cloud capability #12 enviable track record of delivery in the IT services space. growth has been mixed, even with a good start to 2018, it needs to • Strong workplace services narrative: Workplace services is an area where deliver consistent growth if it is to appear as a safe pair of hands. It is DXC has shown considerable flair for marketing and thought leadership, capable of delivering the very largest of deals, but financial stability is capturing significant mindshare in the space. a key component of winning at this level particularly with new clients. Partnering and IP #12 Acquisitions and partnerships Operations and key clients Innovation capability • Strategic partnerships: Amazon Web Services, AT&T, DellEMC, HCL, • Infrastructure services FTE headcount: 80,000 Hitachi, HPE, HP, IBM, Lenovo, Micro Focus, Microsoft, Oracle, PwC, SAP, • Data center locations: 91 data centers distributed globally Vision and ServiceNow, Alibaba, Google, Pivotal, RedHat, Citrix, Fixnetix, Axon Puerto • Delivery center locations: Bangalore, Chennai, Hyderabad, Noida, Ho #6 Rico methodology Chi Minh City, Taguig City, Plano, Quezon City, Indore, Gurgaon, Beijing, Dalian, Shanghai, Wuhan, Chongqing, El Paso, Pontiac, Buenos Acquisitions: 2018: Sable37, eBECS, M-Power; 2017: Logicalis SMC, HPE ES; Aires, Cordoba, Newcastle, Erskine, Warsaw, San Jose (Costa Rica), Automation and 2016: Fruition partners, Xchanging, UXC, Aspediens, Tribridge #5 Cairo, Araraquara, Porto Alegre cloud strategy • Key clients: AkzoNobel, All Nippon Airways, B&Q, Bluescope Steel, Voice of the Everest Re, Kraft Foods, Lloyds of London, Owen-Illinois, Union #18 customer Insurance, Zurich Insurance Group

0537511d Unisys: Security-focused provider with a strong service management background Dimension Rank Strengths Opportunities • Strong security credentials: Unisys is recognized in the infrastructure space • Perception as a hardware company: One of the biggest challenges HFS Top 10 position #9 for its security-focused products and services. The firm continues to invest Unisys needs to grapple with is the unwavering perception that the in security capabilities as a differentiator, leveraging its experience in the firm is a product and hardware company rather than a serious Ability to execute space and in particular verticals such as financial services and banking services firm in the space. Unisys needs to work hard to shatter this where security is a major table stake. perception. • Partnerships: Unisys is continuing to invest in partnerships to support its • Marketing innovation capabilities: Similarly, the firm seems to Scale and breadth #5 infrastructure service line with scalability. struggle to articulate its credentials for innovation—clients rate the • Strong service management pedigree: Unisys has a great reputation for its firm highly for delivery but struggle to articulate the firm’s vision and Cloud capability #15 service management capabilities, something valued by clients looking for innovation capabilities. full workplace services capabilities. • Seen as a pure desktop provider. Also, the companies services are • High client satisfaction: Satisfaction metrics used by the firm indicate a seen as focused largely on desktop management where it has strong high level of satisfaction with the firms delivery. credentials. Partnering and IP #17 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: • Infrastructure services FTE headcount: 38,000 • Microsoft, Amazon, Dell EMC, ServiceNow, Equinix • Delivery center locations: USA, Columbia, Brazil, UK, Sweden, Vision and Netherlands, Hungary, India, China, Philippines, Australia, New #10 Acquisitions: None methodology Zealand • Key clients include: Bytes Technology Group, California State Automation and #11 University, Cencosud, Flowserve, Maimonides Medical Center, NEC cloud strategy 7-Eleven, New Zealand Transportation Authority, NEXA Resources Voice of the #13 customer

0537511d Wipro: Strong brokerage credentials driving a “cloud-only” philosophy Dimension Rank Strengths Opportunities • Hybrid cloud a major component of engagements: Wipro is pushing a • Talent: Undoubtedly an issue for all of the major IT services players, HFS Top 10 position #10 coherent vision for the role of the hybrid cloud in new and existing clients mentioned that all of the big players are losing talent to the engagements. major ISVs, notably Google and Amazon, as demand for high-quality Ability to execute • Cloud brokerage model: The firm is driving a strong brokerage model, cloud talent increases. Like many, Wipro will need to invest in where Wipro adds value by supporting clients in their selection of the right attraction and retention programs to ensure it can bring the right cloud capability for the outcome they want to achieve. people into engagements. Scale and breadth #13 • Driving a platform approach: Wipro advises it is moving away from • Scale of its broader consulting skills. As infrastructure services frameworks that are too constricted for the modern enterprise’s needs and become more embedded within other service offerings, business Cloud capability #9 is instead building out a platform approach. consulting and change management credentials become more • Cloud Only: A core component of the firm’s vision for the future of the important. space is to shift from a cloud-first to a “cloud-only” approach. Partnering and IP #10 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: • Infrastructure services FTE headcount: 28,668 • Data center and cloud: AWS, Cisco, Microsoft, Oracle, HPE, Intel, • Data center locations: 15 data centers located in APAC, US, Canada, Vision and VMWare, IBM, BMC, Veritas, Commvault, Nutanix, Nexenta, HDS, NetApp, and Europe #9 Pure Storage, Turbonomic, Densify, RISC Networks, CloudVelox, • Delivery center locations: India, Australia, USA, UK, Brazil, Canada, methodology LivingPlanIT (IOT), Google, Pivotal Software China, Germany, Mexico, Manila, Romania, Singapore, Ireland, • End-user computing: Microsoft, Citrix, VMware, Nexthink, RES, 1E, Poland, and Switzerland. Automation and Flexera, ASG, Asigra, Vayusphere, ParaBlu & Field Service Partners: WWTS, #4 Compucom, Getronics, Hemmerdbach, A&O, Innoserv cloud strategy • Open source and DevOps: Suse, RedHat, Cloudfoundry, Xebia Labs, • Key clients include: A large insurance firm, A major bank and Apprenda, CloudBees, Chef, Puppet Labs, Docker financial services company, a global consumer goods company, A Voice of the • Automation: Arago, Automation Anywhere, Blue Prism, HP, BMC, Ayehu, major pharmaceutical firm #14 UiPath customer Acquisitions: 2017: Cooper; 2016: Appirio, Healthplan Services, InfoSERVER; 2015: Cellent, DesignIT; 2014: ATCO

0537511d NTT DATA: Trusted infrastructure provider, but needs to push a clearer narrative Dimension Rank Strengths Opportunities • Infrastructure services at scale: NTT DATA offers one of the largest • Marketing and thought leadership: Historically, NTT DATA has HFS Top 10 position #11 networks of connected data centers globally, which enables the firm to avoided investing in marketing activities and instead has relied on its tackle the particular needs of enterprises looking for capabilities in certain reputation for delivery to win deals. However, the infrastructure Ability to execute geographies, or those looking for global scale. space has become more competitive with new and innovative firms • Trusted provider in the space: NTT DATA is a well-recognized provider in moving in with clever marketing activity to gain mindshare. NTT DATA the space, with a strong track record of delivery. may need to rival this activity at some point and should consider Scale and breadth #8 • Increased consulting focus: NTT DATA continues to push consulting and building out a clear marketing narrative now to help it attract and advisory to the front of engagements to ensure the right solutions are retain mindshare, a platform that it can expand as the market Cloud capability #20 designed and implemented to solve a customer challenge. becomes more competitive. • Talent program to reinvigorate capabilities: NTT DATA is investing heavily in talent through partnerships with key academic institutions and the development of training factories. Partnering and IP #14 Acquisitions and partnerships Operations and key clients

Innovation capability Key partnerships: • Data center locations: 240 connected centers worldwide including • Cloud: NTT Comms, Microsoft, Amazon, Google, VMWare, Citrix USA, India, UK, France, Germany, Spain, South Africa, China, Vision and • Service management: Service Now, BMC Remedy Singapore, Thailand, Vietnam, Nigeria, Ghana, Japan, alongside 80 • Microsoft, Amelia, Interactions, Lakeside, Aternity #16 Analytics: owned or leased by customers. methodology • Automation: IPSoft, Aptean, Puppet, Zenoss Automation and Acquisitions: 2016: Dell Services; 2014: Everis Group • Delivery center locations: USA, India, Mexico, Panama, Romania, #13 China, Singapore, Morocco, UK, Brazil, Australia cloud strategy • Key clients: Tenet Health, Russell Investments, Hilton, MetLife, Voice of the #17 Wolters Kluwer, KB Home, Wayne Fueling Systems, Owens & Minor, customer Experian, DuPont

0537511d Capgemini: Strong technical consulting capabilities

Dimension Rank Strengths Opportunities • Outcome-focused commercial model: Capgemini has evolved its • Commitment to innovation: Clients have advised that Capgemini can HFS Top 10 position #12 commercial model to ensure clients only pay for the services they use. sometimes get a little too comfortable in an engagement, meaning its • Strong business engagement: Clients advised that they place a high value drive and commitment to innovate and continue improving reduces. Ability to execute on Capgemini’s ability to engage with key business stakeholders and form Although they advise that the firm is highly successful at meeting pre- meaningful relationships. defined SLAs, there is often a gap between the expectation to go • Innovative modular design: In its latest data center design, Capgemini has above and beyond and the firm’s appetite for doing so. Scale and breadth #16 driven a modular design throughout to enable clients to select services and • North America: There are fewer large-scale examples than some capabilities with more flexibility. competitors when it comes to infrastructure management with North Cloud capability #17 • Strong vision for convergence: Capgemini has recognized that one of the American organizations requiring global rollout. This may inhibit the biggest challenges when tackling legacy infrastructure set-ups is their siloed firm’s ability to pitch for similar deals in an environment where proof and detached nature. of delivery carries an increasingly high premium. Partnering and IP #20 Acquisitions and partnerships Operations and key clients Innovation capability • Cloud partners: AWS, Microsoft Azure, Google, Cloudendure, Nutanix, IBM, • Infrastructure services FTE headcount: 22,000 RedHat, Dell EMC, AppDynamics, PlateSpin, Racemi, RISC networks, HPE, • Data center locations: Finland, France, Netherlands, Germany, Spain, Vision and Terremark, Cloud Bolt, Puppet labs, CHEF, Aryaka, Hitachi, Avai UK, USA, Brazil, Canada #12 • End-user services: Citrix, Microsoft, BMC, HP, Odigo, Dell EMC, Meridian, • Delivery center locations: India, Poland, Romania, Brazil, Belgium, methodologies Ivanti, Lenovo, Atlantis, Google, Smart, Airwatch (VMware), Lakeside, Canada, Finland, France, Germany, Netherlands, Spain, Sweden, Meridian, Flexera, Ilantus, NSC, Cannon, Kyocera, Kinetic Data, Amazon Switzerland, UK, USA Automation and WorkSpaces, Konica Minolta, DecisionOne, Pomeroy #17 • Service integration: BMC, Dell EMC, Service Now, Sofigate cloud strategy • Cybersecurity: RSA, IBM, Oracle, Gemalto, Fortinet, Fortify, TrendMicro, • Key clients include: environmental agency, Heathrow Airports, State Cyberark Symantec, Palo Alto, PingIdentity, Appscan, Forgerock, Nokia of Texas Department of Information Resources, Credit Agricole, Voice of the Ontario Power Generation, French multinational integrated oil and #11 gas company, Nationwide, Airbus customer Acquisitions: 2015: Igate; 2014: Euriware

0537511d Fujitsu: Legacy of delivery in the space, but needs to prove innovation capabilities Dimension Rank Strengths Opportunities • Strong technical background: Clients recognize Fujitsu for its strong • Innovation agenda: It is challenging to gauge the firm’s roadmap and HFS Top 10 position #13 technical background and a wealth of experience in tackling enterprise agenda for driving innovation in its services. The firm has a track technology challenges. record for delivery, but it is perceived by clients to be falling behind Ability to execute • Reputable IT provider: Fujitsu has a long history of delivery in the IT competitors. Services space, which contributes to the reputation the firm has for being a • Marketing: Compared to some of its rivals, Fujitsu has a relatively ”safe pair of hands” for tackling IT projects and initiatives. relaxed approach to marketing and messaging—with somewhat Scale and breadth #15 • Global infrastructure capabilities: The firm has a reasonable global limited thought leadership. delivery capability spread out of key geographies including Europe, North • Legacy: The firm’s legacy of operating in the IT services space can be Cloud capability #18 America, and Asia. a double-edged sword in some instances. Many enterprise clients are • Hybrid cloud: The firm continues to push a compelling hybrid cloud looking for something new and innovative to help them out- narrative, supported by the firm’s service management capability and accelerate rivals and disruptors in their own industry, so are looking unified management platform. to newer entrants to the market. Partnering and IP #18 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: Total employees: 159,000 The firm has not provided any additional partnerships information; however, Vision and public records indicate the firm partners with the following companies: The firm operates on a global delivery model with key data centers in #13 • Amazon, Cisco, Citrix, Intel, Microsoft, NetApp, Oracle, SAP, VMWare, Japan, Australia, Singapore, US, UK, and Germany methodology Brocade, CA Technologies, Commvault, Quantum, RedHat, Symantec, Suse Key clients: First Citizens Bank, Virgin Money, HR Revenue and Customs Automation and #15 Acquisitions: 2015: UshareSoft cloud strategy Voice of the #12 customer

0537511d Genpact: Smaller and agile player, but holds a lot of trust in certain verticals Dimension Rank Strengths Opportunities • Mature shift-left approach: Genpact’s clients value the firm’s developed • Scale: Genpact is one of the smaller players in the space, with a HFS Top 10 position #14 approach to shift left, which seeks to highlight and isolate recurring focused market in key geographies and industry verticals. As the firm problems and move them out of the client environment. solidifies its IT services offerings, it may need to expand into verticals Ability to execute • Flexible approach: Clients have also lauded the firm’s flexible approach to and markets that will bring it into competition with more embedded engagements, advising they are more than willing to bring in additional competitors. To bridge this, Genpact should look to experiment and resources or more experienced professionals to support clients. build proof of delivery and capability examples with existing clients to Scale and breadth #20 • Strong focus on key verticals: Genpact is focused on particular verticals. showcase the firm’s full capabilities. • Merging IT services lines: Genpact is closely following major trends in the • Commitment to IT services. Genpact is largely a BPO player, with Cloud capability #11 IT services industry by merging service lines to enable clients to secure strong process management skills. Although this may serve it well as seamless services. IT and BPO service barriers start to fall—there is a question mark about its commitment to standalone IT infrastructure services and its ability to invest. Partnering and IP #19 Acquisitions and partnerships Operations and key clients Innovation capability • Workplace services: Exis, Decision One, Avaya • Infrastructure services FTE headcount: 4,500 • Cloud: RISC Networks, CoreStack, Microsoft Azure, AWS, Google Cloud • Data center locations: India, US, Europe, Philippines, Mexico, China Platform Services • Delivery center locations: India, Romania, USA, China, UK, Vision and • ServiceNow #15 Service management: Philippines, Mexico, Poland methodology • IT process automation: Ayehu, Right Answers • Automation and Acquisitions: 2017: LeaseDimensions, Rage Frameworks, TandemSeven; Key clients include: Fortune 50 Global conglomerate, leading US #18 2016: PMNSoft; 2015: Endeavour, Openwealth Platform (Citibank) retail chain of variety stores, leading American provider for digital cloud strategy cable television, telecommunications and home automation services, top multinational beverage corporation, one of the top three brewing Voice of the companies in the world #15 customer

0537511d Tech Mahindra: Competing with rivals with DevOps and hybrid cloud narrative Dimension Rank Strengths Opportunities • Vertical specialization: Tech Mahindra has an enviable history and track- • Scale and reach: Tech Mahindra has built out significant capabilities in HFS Top 10 position #15 record of delivery in particular verticals—most notably telecoms. the infrastructure space and, in some cases, has cornered markets as • Strong DevOps narrative: Tech Mahindra has built out its DevOps a trusted provider. However, the firm does lack some of the scale and Ability to execute capability to support a clear narrative and vision for merging business reach associated with some of the largest providers in the space. In applications and infrastructure services. some instances, this is more of an issue of perception than capability, • Productivity gains built into pricing: The firm advises it is moving away but it may hamper the firm’s capacity to tackle global transformation Scale and breadth #9 from FTE-focused pricing models, and it is instead moving forward with deals from enterprises looking for a heavy-lifting partner. element or fixed-unit models. Cloud capability #13 • Partnerships and acquisitions: Tech Mahindra recognizes that the market is shifting heavily toward as-a-service engagements with a particular focus on public and hybrid cloud. As a result, the firm is deepening partnerships with major cloud providers; it is also working with start-ups. Partnering and IP #15 Acquisitions and partnerships Operations and key clients Innovation capability Key partnerships: • Infrastructure services FTE headcount: 12,000 • Workplace Services: Citrix, NetApp,Cisco,RES Software ,Microsoft , • Data center locations: 13 data centers located in the USA, Denmark, Infocare, Getronics, WWTS, DecisionOne, Verser Norway, Romania, Malaysia, Singapore, and Australia Vision and • Cloud Services: AWS, Microsoft Azure, Google, Oracle, IBM, ServiceNow, #11 • India, Malaysia, Singapore, Australia, methodology Office365 Delivery center locations: • Data Center: Oracle, HP, Cisco, IBM, Dell, EMC, NetApp, HDS, VMWare, China, Hungary, Northern Ireland, US, Brazil, US, UK, Netherlands, Belgium, Denmark, Australia, and the Philippines Automation and Microsoft, RedHat, BMC, CA, PureStorage, CommVault, Cohesity #6 • Automation: Cortex , ServiceNow, BMC, Arago, HP, RES, Nexthink, Ipsoft cloud strategy Inc • Key clients include: a large telecom provider in North America, a • Service Management: BMC, ServiceNow, HP, CA leading service provider in Europe, a large bank in Australia, a Voice of the Acquisitions: 2016: CJS Solutions Group, Target Group, BIO Agency Limited; leading airline in Australia, a large conglomerate in North America, A #19 2015: Pininfarina; 2014: Lightbridge Communications Corporation, SOFGEN, UK-based insurance major and a large automobile company in customer BASF, FixStream Europe

0537511d CGI: Outcome focused provider, but must articulate a clearer vision for IMS Dimension Rank Strengths Opportunities

• Outcome focused delivery model: CGI pushes an outcome focused delivery • Weak marketing: CGI struggles to articulate its offerings and HFS Top 10 position #16 model across its infrastructure services engagements which it underpins capabilities compared to other more entrenched providers. The firm with strong governance models to drive consistency and secure results. needs to build out a clear and coherent vision for infrastructure and, Ability to execute • Recognized player in the space: CGI, through the heritage of its crucially, what differentiates the firm from its rivals. While the firm acquisitions, is an experienced provider in the space with a strong track has a reasonable reputation for delivery, the acknowledgement of its Scale and breadth #18 record in a variety of industries. The firm is recognized by some innovation capabilities is harder for clients to gauge and articulate. organizations as a trusted provider operating in there space. • Perception as traditional IT: While there is still a major market for • Access to IT Services talent: CGI has a strong spread across onshore, traditional forms of IT and infrastructure work, this market is Cloud capability #21 nearshore, and offshore delivery alongside talent distributed across core shrinking. Enterprises are pushing towards cloud and as-a-service. As traditional IT service areas. This enables the firm to bring in key talent to this trend continues, CGI may fall behind unless it clarifies its position support infrastructure engagements in a cost-effective and flexible manner. and how it is adapting its business and engagement model to better resonate with the changing needs of the modern business. Partnering and IP #21 Acquisitions and Partnerships Operations and Key clients Innovation capability • Key Partnerships: Total employees: ~70,000

Vision and Global Partners: Microsoft, Oracle, SAP, IBM The firm operates in over 40 countries with approximately 400 offices #18 Specialist Partners: Adobe, Akamai, BMC, Bocada, Cerner, CiRBA, Cisco, worldwide. methodology Citrix, Dell, EMC, ESRI, Hitachi, HP, Informatica, IPSWITCH, McAfee, Monetise, NetApp, OpenText, Qliktech, Paessler, Red Hat, Salesforce, Seamless Key IMS delivery centers include: US, India, The Philippines, Malaysia, Automation and #20 Technologies, Sentry Software, Solarwinds, Splunk, Symantec, Tibco, Tier3, and Canada cloud strategy VMware, Ferranti The firm has not provided any further reporting information. Voice of the Acquisitions: 2016: Alcyane, Collaborative Consulting, JSL #10 customer

0537511d Syntel: Pure-play broker bringing major cloud providers to client engagements Dimension Rank Strengths Opportunities

• Client for life focus: Syntel focuses on building long-term engagements • Revenue concentrated with a few clients: Syntel’s drive to deepen HFS Top 10 position #17 with clients under its “client for life” approach. existing relationships and engagements has allowed the firm to build • Client partnerships: Syntel drives a partnership model with its existing long-lasting partnerships. But, it does come with risks—over half of Ability to execute clients—shifting away from traditional engagement methods. the firm’s revenue comes from a handful of clients, which poses a • Pure-play brokerage model: Syntel does not own any data centers directly potential risk should the clients terminate relationships or cease to Scale and breadth #19 and plays in the infrastructure services space as a pure-play service broker. exist. Syntel may benefit from breaking away from its approach The firm has partnerships with all major providers in the space to support slightly and diversifying its client pool to mitigate this risk. this model. • Lacks scale to take on largest deals. Syntel historically has not relied Cloud capability #6 • Customer profile attracts talent: Syntel advises it does not foresee any on scale to do the ‘heavy lifting’ in major transformation programs. major talent issues in the near future as the nature of the work it does and Instead, focusing on leveraging cloud and automation in its client profile attract the right talent for its business. engagements. Partnering and IP #7 Acquisitions and partnerships Operations and key clients Innovation capability • Key partnerships: • Infrastructure services FTE headcount: 1,000 Amazon Web Services, CA, Cherwell, Google Cloud Platform, IBM, Microsoft, • Data center locations: Partner brokerage focused Vision and Pivotal Labs • Delivery center locations: USA, Scotland, Poland, India, and the #14 Philippines methodology Acquisitions: None • Key clients include: FedEx, American Express, State Street, a major Automation and #12 US health insurer, a large private healthcare provider, a financial cloud strategy analysis and research company, and a Fortune 100 insurer in the US Voice of the #21 customer

0537511d Hexaware: Asset-light firm committed to brokerage model

Dimension Rank Strengths Opportunities • Automation focus: Hexaware continues to bring automation capabilities • Asset light: While the market moves toward brokerage models on the HFS Top 10 position #19 into new and existing deals, working to automate processes and workloads whole, there is still a need from many client organizations for their regardless of whether that strategy cannibalizes the firm’s revenues. providers to hold some assets to help them on their transformation Ability to execute • Focused growth: Hexaware ensures only two to three clients are journey. This may push Hexaware out of scope for some onboarded each quarter so that growth does not inhibit the firm’s ability to engagements. provide consistent services. • Concentrated growth: Hexaware has a growth strategy focused on Scale and breadth #21 • Solid vision and strategy: Hexaware has developed a coherent strategy driving consistent service while onboarding new clients. While this is based on the core principle of "Automate First, Self Serve Next, and Smart laudable, it will undoubtedly inhibit the firm’s ability to scale quickly Cloud capability #19 People Last." as the infrastructure market peaks and troughs. • Cloud brokerage model: As Hexaware is not an infrastructure-asset-heavy provider, it has been able to develop a coherent and vendor-neutral brokerage and integration strategy for cloud. Partnering and IP #13 Acquisitions and partnerships Operations and key clients Innovation capability • Partnerships: IBM, Microsoft, Red Hat, Fiorano, Kony, Site Core • Infrastructure services FTE headcount: 1,500 International, Appian, Adobe, Mule Soft, Cignex, Cloudbyz, EvolveWare, • Delivery center locations: USA, Singapore, Romania, UK, Germany, Vision and BFSI Consulting, Cloudera, Informatica, LavaStorm, Xurmo, Blue Prism, Russia, and India. #17 NetSuite, Workfusion, UIPath, HPE, Experitest, SmartBear, Conformiq, RealTime TechSolutions, Passbrain, Kentico, Xamarin, Tzunami, methodology • PicturePark, WSO2, SAP, SuccessFactor, Oracle, Workday, Hunite, Talview, Key clients include: One of the world's 20 leading pharmaceutical companies based out of Germany, the largest non-bank private- Automation and Salesforce, EMC, FireEye, Computer Associates, ServiceNow, Opex #9 Software, AppZero, Nutanix, SimpliVity, Symphony Summit, AppDynamics, sector life insurer in India founded in 2000, a global information cloud strategy DecisionOne, Wikitude, Riversand services company based out of Netherlands, a Singapore-based manufacturer providing mechanical and electro-mechanical component solutions worldwide, a Fortune 500 US-based company Voice of the Acquisitions: None #20 and one of the world's largest staffing firms. customer

0537511d Hyperscale provider profiles

0537511d Microsoft: Trusted cornerstone of the modern enterprise

Dimension Rank Strengths Opportunities • Trusted enterprise provider: Microsoft has been a major name in the • Thought leadership: Compared to AWS’ strong IT narrative and HFS Top 10 position NA enterprise technology space for most of the history of modern business. Google's push towards analytics and machine learning capabilities, For many clients, the firm represents a trusted cornerstone of their Microsoft has lost ground in the battle for thought leadership. For Ability to execute technical estate. This has enabled the firm to position its cloud capabilities the most part, clients have questioned Microsoft’s commitment to alongside other enterprise products, particularly the firms’ productivity innovating in the space generally. The firm needs to build a coherent suite. marketing and thought leadership program to help differentiate the Scale and breadth #17 • Scale and reach: Over the years, Microsoft has built enormous scale into firm among its stiff competition. its cloud capabilities and spread data centers and delivery centers over Cloud capability #4 major geographies. This has enabled the firm to position Azure as an important building block of any hybrid agenda. • Licensing model: Clients tell us that with the licensing model they currently have, other Microsoft products and services come in as relatively Partnering and IP #3 competitive—positioning the firm as a good first port of call for any migration conversation. Innovation capability Execution Innovation Voice of Customer

Vision and #1 Microsoft #20 methodology Automation and #19 #2 AWS cloud strategy Voice of the #6 #3 Google customer

0537511d AWS: Unrivalled mindshare and strong techie following

Dimension Rank Strengths Opportunities • Strong technical capabilities: Out of the three hyperscale cloud providers, • Perception of competition: The firm’s parent organization, Amazon, HFS Top 10 position NA AWS gets the most plaudits from the technical and IT communities for is a double-edged sword. While the leadership and resources the removing friction and pain points. The firm continues to build out mothership provides are important components of AWS’ speedy Ability to execute capabilities based on feedback from its strong technical communities that growth, the association is also a major turn-off for some clients. get to the core of enterprise challenges Amazon continues to expand rapidly, and new and existing AWS • Scale and reach: AWS has one of largest networks of data centers in the clients are questioning the wisdom of writing a check to a firm that Scale and breadth #14 world and has become synonymous with flexibility and scale. Clients will become a major competitor in their industry. including Netflix are a living testament to the firm’s ability to provide • Business language: AWS’ ability to woo the technical community is a Cloud capability #10 scalable compute capability even for client organizations that grow at an lynchpin to the firm’s success. It also poses something of an inhibitor unprecedented speed. as the firm has done relatively little to translate its offerings into a • Thought leadership: AWS’ thought leadership captures significant language that senior executives are willing to digest. If the firm is to mindshare in the space, but the firm also has a knack for bringing proof of move engagement to the next level, it will need to start talking Partnering and IP #1 concept swiftly by building out innovative capabilities and experimenting business language alongside its technical vocabulary. on new functions. Innovation capability Execution Innovation Voice of Customer

Vision and #1 Microsoft #21 methodology Automation and #21 #2 AWS cloud strategy Voice of the #8 #3 Google customer

0537511d Google: Strong vision for analytics and becoming the platform of choice for data-intensive initiatives Dimension Rank Strengths Opportunities • Analytics and machine learning: Where Google stands out in the • Sleeping giant: In many ways, Google is a sleeping giant. The firm HFS Top 10 position NA hyperscale space is its focus on developing a cloud platform to drive has grown a little, but not by much in comparison to the other major enterprise machine learning, AI, and analytics initiatives. This work is players. This seems to be part of a strategic decision from the firm, Ability to execute quickly gathering the firm’s mindshare and could see major growth for the which is more focused on the consumer market. firm as appetite for these initiatives increases in the coming years. • Marketing: Google is part of one of the biggest marketing • Relative neutrality: Compared to some of the other major providers in the capabilities in the world but does relatively little to push itself as a Scale and breadth #10 space, Google can tout some relative neutrality for the bulk of enterprises. major player in the hyperscale cloud space. Should the firm want to As a result, the firm is swiftly making its way on to the short list of more aggressively compete with the other major players, it will need Cloud capability #16 enterprises looking to avoid indirectly funding their competitors. to invest in marketing to set out how it differentiates itself from • Funding from the mothership: Google is another firm that isn’t playing in major competitors. the cloud space alone. The firm’s mothership, Alphabet, presents the opportunity for the business to access funding and resources for quick Partnering and IP #11 growth should it need it. Execution Innovation Voice of Customer Innovation capability #1 Microsoft Vision and #19 methodology Automation and #2 AWS #16 cloud strategy Voice of the #7 #3 Google customer

0537511d Market direction and recommendations

0537511d Market summary

• While the market is pivoting away from traditional engagements, there is still plenty of hands-on heavy lifting transformation work to be had. It’s reasonable to expect some of the more traditionally focused providers to continue to hammer away at this market. Meanwhile, the more forward-thinking providers covered in this piece are building out partnerships and brokerage models to drive value-add services over the top of the hyperscale cloud wave. • Surviving in this turbulent market is no small feat—as traditional revenues continue to freefall, we can expect not only rapid evolutions for the latecomers but also some players to move out of the market entirely—voluntarily and involuntarily. • One thing is clear: Enterprises are showing huge appetites for getting their digital underbelly in order—no doubt to help support the deployment of other, more glamorous technologies such as AI and analytics further down the line. But, without internal talent and expertise, the demand for high-quality professional services to help select, broker, and deploy is a potential gold mine for providers with the right partnerships and offerings in place. • Perhaps the most striking part of this increased demand is the impact it is having on overall market capacity—while the market is not expected to grow, the increased workload from the cloud will fill in the hole left by crashing revenues from declining traditional infrastructure work. This is significant because the increased utilization and industrialization of cloud technologies should lead to a drastic drop in overall market capacity. In the same way that if everyone started renting cars instead of buying them, the increased utilization of a single car from one person to five would lead to four fewer cars being purchased. The increased usage of infrastructure assets should mean less is needed. However, the insatiable drive for digital means more and more cloud capacity is needed for processing and storage. The infrastructure market may not be the most glamorous in the digital economy, but it’s where all the action is happening today.

0537511d What does the future hold for the industry?

We’re almost certain to see more consolidation as the traditional market continues to be ravaged by the onslaught of as-a- service and hyperscale cloud. However, there is a clear path that the industry will need to tread before it’s out of the woods: • Partnerships and brokerage: Simply put, providers in the space won’t be able to survive without developing a solid partner ecosystem. Undoubtedly, the big hyperscale providers will be the cornerstones, but there is still plenty of room to find innovative consultancies, boutiques, and providers to partner with. More and more, we’re hearing that clients pay close attention to the partners a provider can bring into engagements. Enterprises crave simplicity in a complex world, so if they can go with a single provider with an ecosystem of capable partners to bring into engagements, all the better. • Utility and consumption pricing: The major cloud providers haven’t just eroded the market share of traditional firms, they’ve turned commercial models on their heads. The prospect of paying only for the cloud capacity you use is no longer a utopian business ideal; it is a standard offering—providers that are reluctant to step away from traditional pricing models won’t have much choice as enterprises force utility and consumption pricing to become the industry norm. • Shift in focus to outcomes: Outcome-focused work isn’t a new concept, but it does stand to make a major impact on the infrastructure space. To many, infrastructure is the unglamorous activity that keeps the lights on and outside of this core business objective rarely finds itself as a topic of enthused conversation in the boardroom. But, with businesses focusing on particular outcomes they want to achieve such as a new business application or automation implementation, infrastructure will find itself even further from the boardroom. Enterprises want outcomes. How the infrastructure supports those outcomes is the business of internal IT or an external technology partner. Outside of migration work, we can expect to see a major blurring between what we define as infrastructure work now and broader technology and IT initiatives.

0537511d Enterprise recommendations

• Be flexible: Depending on the nature of the engagement, bringing some flexibility can be enormously beneficial. Allowing providers the wiggle room they need to scope out and design a roadmap that will get you where you need to be is a worthwhile tactic in the complex and fast-moving infrastructure space. This is particularly the case for large, complex engagements that require a full transformation roadmap. • Come with a clear vision of outcomes: The bane of service providers is when enterprises don’t have a clear vision of what they want to achieve or the outcomes they expect. Without this, it’s like drawing out a journey without knowing the destination. Providing this clarity will become more important for enterprise clients as vendors become more selective over the types of engagements they are willing to engage in. • Be realistic: Too often we hear the same mistake made when enterprises spec out their migration strategy—they believe many, if not all, of their services are cloud worthy. Unfortunately for many organizations, this is far from the case. Enterprises must be realistic from the outset and recognize that, particularly for older companies, migrating to the cloud may be a long drawn out slog rather than a quick flip of a switch. This realism must extend to application modernization. Don’t be surprised if you’re pushing an ambitious migration project if the budget comes under pressure as the amount of application modernization work takes up bigger chunks of the bill. • Walk don’t run: Similarly, almost daily the media reports of a rushed infrastructure project gone wrong— ultimately the plumbing in scope for your initiative is likely to be the only thing holding up vital parts of your business. It’s important to take time, find out what’s important, and prioritize accordingly.

0537511d Service provider recommendations

• Build a clear vision: The turbulence of the infrastructure market is increasing the levels of confusion in the space—vendors must build clear visions and narratives for how they see the market, how they can differentiate themselves from their rivals, and how they can help clients navigate their way through the chaos. • Bring proof to engagements: Enterprises are now, understandably, more cautious and cynical about vendor promises. So it’s essential that providers bring proof of delivery to engagements to give potential clients a sense of their capabilities, understanding of the industry, and ability to get the job done. • Experiment with clients: To get the needed proof, providers should work with existing clients and push the boundaries of innovation in experimental initiatives. This approach provides clients with innovative and cost-effective solutions while building valuable proof of delivery capability and commitment to innovation. • Develop ecosystems: Increasingly, enterprises are expecting vendors to provide them more than their internal offerings. Clients want a provider that can support them directly through brokering deals with a broad partner network that includes the main providers and the “small and cool” startups and boutiques. It’s important for providers to build out partner ecosystems to satisfy this demand and extend the scope outside of the usual suspects by bringing in new and innovative players in the space. • Build flexible models: Utility pricing has changed the game completely for infrastructure players—now more than ever you will be expected to provide a variety of pricing options, from traditional to consumption focused. To satisfy client demand, providers must evolve their business models to better align with the direction the market is going. Those who fail to do so may quickly lose traction as the hyperscale cloud players continue to set the pace.

0537511d Survey respondent demographics

0537511d About the survey

Geography Industry Other 38 30

US 177 180 Government 35 30 Insurance 35 30 Energy 34 30 Travel 33 31 Europe 71 62 Manufacturing 33 30 Survey Utilities 33 30 2017 2018 Telecom 25 30 APAC 59 60 Banking 21 30 Healthcare 20 31 Number of Respondents Number of Respondents

Company size (Number of employees) Job Title

Between $1B and Director 185 178 166 168 $5B Senior Vice President, Function 60 64 Head Between $5B and 85 83 $10B Vice President 62 55

Greater than $10B 56 51 CEO, C-Level or Executive Vice 5 President Number of Respondents Number of Respondents

0537511d HFS Research authors

Ollie O’Donoghue Jamie Snowdon Research Director| HFS Research Chief Data Officer | HFS Research [email protected] [email protected]

Ollie O’Donoghue is Research Director, IT Services. With over five years Jamie Snowdon has primary responsibility for overseeing the experience in the IT services industry —as both a practitioner and a research development of HFS’ Quarterly Market Index, in addition to managing analyst—Ollie understands the impact IT services have in the modern and developing the firm’s data-centric products and services. He works business environment. across the HFS analyst teams to define evolving services markets and create market size estimates and forecasts. Before joining HFS, Ollie was the Head of Research He also manages HFS’ quantitative survey and benchmark data. Jamie and was an Industry Analyst for an ITSM Practice . He provided IT service and has over twenty years experience in the IT and Business Services support organisations with the resources to deliver greater business value. industry. In that time he has worked in a variety of roles including sales, There he developed a comprehensive research portfolio for the industry. He marketing, consulting and as an industry analyst. Jamie’s analyst career has researched and presented on a multitude of topics including automation, has largely been spent conducting data analysis including market innovative support models, and real-time analytics. In 2017, Ollie was named size/forecast models, quantitative/qualitative survey analysis and second on a list of IT and ITSM experts to watch. competitive analysis.

0537511d Defining future business operations

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