TM Topic: Everest Group’s PEAK Matrix for Banking AO Service Providers Focus on HCL Technologies July 2015 Copyright © 2015 Everest Global, Inc. This document has been licensed for exclusive use and distribution by HCL Technologies Background and scope of the research Background of the research Rise of digital consumers, need for business agility, growing costs of regulatory compliance, and threat from non-banking competitors in areas such as payments were the key challenges faced by banks in 2014. Banks are aligning their technology priorities around cost containment, efficiency, risk & compliance management, and transformation. Banks continued to invest in development of specific applications for regulatory compliance, risk management, channel-specific initiatives (social, mobile, etc.), and customer analytics The service provider landscape is intensifying as providers ramp up their capabilities, invest in innovative technologies, form alliances, and acquire strategic targets to address the growing and complex application services needs of banks and financial institutions In this research, we analyze the capabilities of 30 leading AO service providers, specific to the global banking sector. These providers were mapped on the Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix, which is a composite index of a range of distinct metrics related to each provider’s capability and market success. Additionally, Everest Group has also profiled the capabilities of these 30 service providers in detail including a comprehensive picture of their service suite, scale of operations, domain investments, delivery locations, and buyer satisfaction specific to banking AO services This document focuses on HCL Technologies’ banking AO experience and includes: Overview of the banking AO service provider landscape Everest Group’s assessment of HCL Technologies’ delivery capability and market success on PEAK matrix Detailed banking AO profile for HCL Technologies Copyright © 2015, Everest Global, Inc. 2 This Everest Group report is a compendium of detailed profiles of 30 service providers featured on Everest Group’s banking AO PEAK Matrix NOT EXHAUSTIVE BFSI Focus of report Banking Capital markets Insurance Retail financial services (B2C1) Investment banking Life and pensions Retail banking Asset management Property and casualty Lending Custody and funds administration Others Cards Brokerage 2 3 Commercial banking (B2B ) Others Services industry IT Infrastructure IT Application Outsourcing Business Process Outsourcing (IO) (AO) Outsourcing (BPO) Consulting Traditional IO Application development BFSI-specific BPO IT strategy / operations Remote Infrastructure Application maintenance HRO consulting Management (RIM) Independent testing FAO Business consulting Infrastructure Management Package implementation PO Infrastructure consulting Services (IMS) ERP services Contact center Infrastructure rollouts Cloud Business intelligence / data Knowledge services warehousing Digital Services Services in next-generation technologies leveraged by enterprises to enable transformation including social, mobility, analytics, cloud, and others (artificial intelligence, robotics process automation, internet of things, machine-to-machine, etc.) 1 Business-to-consumer relationships 2 Business-to-business relationships 3 Includes other capital markets functions such as structured finance, treasury, FX, and horizontal functions including risk management Copyright © 2015, Everest Global, Inc. 3 Everest Group’s BFSI research is based on two key sources of proprietary information 1 Everest Group’s proprietary database of 500+ large, active, multi-year AO Service providers covered in the analysis contracts within BFSI (updated annually through primary data collection via 1 1 1 service provider RFIs) The database tracks the following elements of each large AO relationship: 1 – Buyer details including industry, size, and signing region – Contract details including TCV, ACV, term, start date, service provider FTEs, and pricing structure – Activity broken down separately for banking, capital markets, insurance, and by 1 line of business (for example, credit cards, lending, retail banking, and commercial banking) 1 1 1 – Scope includes coverage of buyer geography as well as functional activities – Global sourcing including delivery locations and level of offshoring 2 Everest Group’s proprietary database of operational capability of 20+ BFSI AO service providers (updated annually through primary data collection via service provider RFIs) 1 The database tracks the following capability elements for each service provider: – Major BFSI AO clients and recent wins – Overall revenue, total employees, and BFSI employees – Recent BFSI-related developments – BFSI AO delivery locations – BFSI AO service suite – Domain capabilities, proprietary solutions, and intellectual property investments 1 Assessment for Accenture, Capgemini, CSC, Endava, Hexaware, HPES (HP Enterprise Services), IBM, and Mphasis excludes service provider inputs, and is based on Everest Group’s proprietary Transaction Intelligence (TI) database, service provider public disclosures, and Everest Group’s interactions with banking buyers Note: We continuously monitor market developments and track additional service providers beyond those included in the analysis Confidentiality: Everest Group takes its confidentiality pledge very seriously. Any information, that is contract-specific, will be presented back to the industry only in an aggregated fashion Copyright © 2015, Everest Global, Inc. 4 HCL Technologies is positioned as Star Performer and Leader on Everest Group PEAK Matrix for banking AO - 2015 Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix for large banking AO relationships1 Leaders 75th percentile High Major Contenders Leaders TCS Aspirants Cognizant Star Performers Major Contenders Accenture Infosys IBM tile ss Wipro Mphasis n e Capgemi ni HCL e c Tech Mahindra r HPES e succ p CGI t CSC th e IGATE k L&T Infotech 75 r a M Dell Services Syntel Virtusa Polaris Softtek Luxoft tile n Unisys Mindtree e c r Genpact e Birlasoft Hexaware p Endava th ITC Infotech 25 Attra Infotech Aspirants EPAM Low Low 25th percentile High Banking AO delivery capability (Scale, scope, domain investments, delivery footprint, innovation, and buyer satisfaction) 1 PEAK Matrix specific to large (>US$25 million TCV), multi-year (>3 years) application outsourcing relationships for the banking sector (retail banking, wholesale banking, credit cards, loans, and mortgages); excludes capital markets and insurance Note: Assessment for Accenture, Capgemini, CSC, Endava, Hexaware, HPES, IBM, and Mphasis excludes service provider inputs and is based on Everest Group’s proprietary Transaction Intelligence (TI) database, service provider public disclosures, and Everest Group’s interactions with banking buyers Source: Everest Group (2015) Copyright © 2015, Everest Global, Inc. 5 HCL Technologies | Banking ITO profile (page 1 of 8) Corporate and BFSI overview >US$500 million US$100-500 million <US$100 million Company description: Established in 1991, HCL Technologies is a Scale of BFSI subverticals global provider of IT solutions, product engineering, custom & package applications, BPO, IT infrastructure services, IT hardware, systems Banking Capital markets Insurance integration, and distribution of ICT products across select industry verticals. HCL Technologies is the services business arm of the Key financial parameters Revenue1 from the BFSI vertical US$6.5 billion HCL Enterprise, which also includes the hardware Revenue in US$ million Revenue1 from other verticals business unit, HCL Infosystems. The HCL team consists of over 105,000 Operating margin professionals who operate from 31 countries, including over 500 locations in India 24.2% Headquarters: Noida, India 16.3% 20.1% Website: www.hcltech.com 5,360 4,152 4,686 1,019 1176 1,436 Geographical mix Service mix 3,924 3,133 3,510 FY 2014; US$ million FY 2014; US$ million FY 2012 FY 2013 FY 2014 100% = 5,360 100% = 5,360 BPO services Services offered for the BFSI vertical: ADM, application Engineering and Infrastructure RoW maintenance, independent testing, SI, enterprise transformation R&D services services services, product engineering, enterprise application services, 12% 5% 16% infrastructure services, digital transformation services (mobile, 34% cloud, and analytics), and business services 32% 56% Domains – channels, payments, cards, lending, core banking, Europe 17% Enterprise trade finance, and cash management application Major BFSI clients: Commonwealth Bank of Australia, Lloyd's Americas 28% services Custom Banking group, DNB Bank, and Standard Bank of South Africa application 1 FY ends on June 30 Source: Everest Group (2015) Copyright © 2015, Everest Global, Inc. 6 HCL Technologies | Banking ITO profile (page 2 of 8) Banking AO capability assessment and market success Everest Group PEAK Matrix for Banking AO Capability dashboard 75th percentile High Leade r s TCS Banking lines of business Geographic scope Cogniza nt Major Contenders Inf osys Accenture Retail Lending North America EMEA e s l i Capgemini IBM t Mphasis Wipro n Commercial Cards/payments Latin America APAC cc e s HCL ce r u Tech Mahindra e s HPES p CGI t CSC L&T Inf otech IGATE th Key technology Mobility Analytics ke Risk & regulatory r 75 a Sy ntel Dell Serv ices e Virtusa l spend areas M i compliance t Sof ttek Polaris Social Cloud