everest group peak matrix™ for procurement outsourcing …
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Copyright © 2019 Everest Global, Inc.
This document has been licensed for exclusive use and distribution by GEP
EGR-2019-22-E-3156
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Everest Group PEAK Matrix™ for Procurement Outsourcing
(PO) Service Providers 2019
Focus on GEP
April 2019
2Copyright © 2019, Everest Global, Inc.
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Introduction and scope
Everest Group recently released its report titled “Procurement Outsourcing (PO) – Service Provider Landscape with Services
PEAK Matrix™ Assessment 2019.” This report analyzes the changing dynamics of the PO landscape and assesses service
providers across several key dimensions.
As a part of this report, Everest Group updated its classification of 16 service providers on the Everest Group PEAK Matrix™ for
PO into Leaders, Major Contenders, and Aspirants. The PEAK Matrix is a framework that provides an objective, data-driven, and
comparative assessment of PO service providers based on their absolute market success and delivery capability. Everest Group
also identified four service providers as the “2019 PO Market Star Performers” based on the strongest forward movement
demonstrated on the PEAK Matrix year-on-year.
Based on the analysis, GEP emerged as a Leader and a star performer. This document focuses on GEP’s PO experience and
capabilities and includes:
⚫ GEP’s position on the PO PEAK Matrix
⚫ Detailed PO profile of GEP
Buyers can use the PEAK Matrix to identify and evaluate different service providers. It helps them understand the service
providers’ relative strengths and gaps. However, it is also important to note that while the PEAK Matrix is a useful starting
point, the results from the assessment may not be directly prescriptive for each buyer. Buyers will have to consider their
unique situation and requirements, and match them against service provider capability for an ideal fit.
Source: Everest Group (2019) unless cited otherwise
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Everest Group PEAK Matrix™
Procurement Outsourcing (PO) BPO Services PEAK Matrix™
Assessment 2019 | GEP positioned as Leader
HighLeaders
Major Contenders
Aspirants
Star Performers
Everest Group Procurement Outsourcing (PO) BPO Services PEAK Matrix™ Assessment 20191
Vision & capability
(Measures ability to deliver services successfully)
Mark
et
Imp
act
(Measure
s im
pact cre
ate
d in the m
ark
et)
High
Low
Low
Aspirants
LeadersMajor Contenders
Aegis
Aquanima
CorbusHCL
Exela Technologies
Cognizant
Chain IQ Wipro
WNS
Capgemini Genpact
TCS
Infosys
IBM
GEP
Accenture
1 Assessment for Aquanima 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 PO buyers
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GEP | PO profile (page 1 of 5)
Capabilities
Key leaders
⚫ Mita Gupta, Vice President
⚫ Abhishek Pandey, Vice President
PO service suite
⚫ Sourcing and category management for direct and indirect categories,
materials, and services: Spend analysis, opportunity assessment, strategic
sourcing, contract management, end-to-end category management, savings
tracking, and compliance management
⚫ Procurement operations: Requisition & purchase order management, tactical
buying, tail-spend management, catalog management, accounts payable, and
contract administration
⚫ Supplier relationship & performance management: Score-carding, performance
tracking & reporting, and compliance management
⚫ Procurement transformation: Procurement strategy, digital procurement
transformation, organizational design & development, strategic cost management,
zero-based budgeting, change management & implementation expertise, best-
practice sharing, continuous improvement & benchmarking, and supply market
intelligence
⚫ Procurement software: AI-powered unified S2P platform, including spend
analysis, sourcing, savings project management, contract management, supplier
management, and P2P delivered through SaaS model
Spend managed for external clients
US$125 billion
Category expertise:
Direct: Chemicals, metals, plastics, ingredients, energy, packaging, electronics,
finished goods, sub-assemblies, among others
Indirect: CAPEX, MRO, general, administrative & professional services, logistics &
freight, IT & telecom, research & development, marketing, packaging, and travel
Key PO-related developments
⚫ 2018: Direct materials – enhanced functional expertise, procurement
technology, and cost modeling capabilities
⚫ 2018: AI – new features and functionalities in AI-powered, unified source-to-
pay platform - SMART by GEP - to boost efficiency and performance with
intelligent automation and analytics
⚫ 2018: RPA – powerful, configurable automation-as-a-service RPA platform
with cloud-based technology at its core and flexibility for standalone hosting
⚫ 2018: Big data / analytics – enhanced analytical capabilities with the
integration of AI, NLP in the SMART by GEP platform
⚫ 2018: New office in Frankfurt, Germany
1 Does not include accounts payable and supply chain BPO FTEs
Scale of operations
Number of PO FTEs1 over time
2016 2017 2018
2,500+3,000+
4,000+
FTE mix by process scope
>500 FTEs 100-500 FTEs <100 FTEs
Source-to-Contract (S2C) Procure-to-Pay (P2P)
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GEP | PO profile (page 2 of 5)
Client portfolio
Major PO clients
Kellogg, Honda, Yorkshire Building Society, Bristol-Myers Squibb, Bayer, Prudential, DuPont, Apotex and several market-leading firms across manufacturing, CPG, retail,
BFSI, pharma, life sciences, oil & gas, chemicals, technology, telecommunications, and media, among others
Recently-announced multi-process PO engagements
Time of signing Client Contract details
2018 Global leader in water, hygiene, and energy technologies Global multi-year program for procurement services and technology
2018 Leading global manufacturer of power and automotive care
products
End-to-end procurement services, strategic sourcing, contract management, and
sourcing support
2018 World’s leading supplier of polyester and specialty materials Spend analysis, strategic sourcing, and opportunity assessment
2018 Large multi-national pharma company Multi-year strategic sourcing and supplier relationship management engagement
2018 Global 2,000 paper and packaging enterprise Multi-year source-to-pay transformation and advisory services
1 Data as of June 2018
PO revenue industry mix1 (2018)
25-29%
15-19%
11-15%
11-15%
6-10%
5-9%
5-9%
6-10%
Hi-tech and
telecom
PO revenue buyer size mix1 (2018)
65-69%
27-31%
PO revenue geography mix1 (2018)
70-75%
21-25%
Large
North America
Europe
Asia Pacific (1-5%)
CPG & retail
Mid-market
ManufacturingFinancial services
Healthcare
& pharma
Others
Energy & utility
Latin America (1-5%) SMBs (1-5%)
Travel & logistics
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GEP | PO profile (page 3 of 5)
Key delivery locations
Shanghai
Mumbai
Hyderabad
London
Sao Paulo
Mexico City
Singapore
Sydney
Prague
Costa Rica
Clark
Toronto
Dublin
Frankfurt
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GEP | PO profile (page 4 of 5)
Technology solutions
SMART by GEP
Solution
description
⚫ A cloud-native S2P software platform that unifies direct and indirect procurement and purchasing in a single system
⚫ Delivers S2P capabilities with no modular integration or hardware requirements
⚫ Built for optimum user experience and adoption, leading to unrivalled ROI
⚫ A complete digital workplace for all stakeholders in the procurement value chain
⚫ Designed and deployed by procurement experts for procurement professionals and users across the enterprise
⚫ Single underlying data model provides natural automation of end-to-end process flow
Process scope⚫ Complete S2P functionality in a single unified platform, accessible across all devices
⚫ Includes spend analysis, savings tracking, project management, sourcing, contract management, category management, supplier management,
P2P, and invoicing functionalities
⚫ Provides complete coverage for all spend categories including direct, indirect, and services
⚫ Procurement portal that features collaboration and data sharing across enterprise functions
⚫ Unified system means no break or separation between procurement and purchasing, ensuring native flow of value from sourcing to the operating
business
⚫ Designed as an open system for integration into pre-existing legacy systems via SMART by GEP adapters or middleware
Technology
leveraged
⚫ Developed exclusively in-house by GEP’s technology team in the Microsoft Azure cloud
⚫ Built on a data lake and AI/ML core
⚫ Native to cloud, mobile, touch technologies, ensuring a cross-platform, and future-proof design
⚫ Continuous improvement strategy delivers functionality with no upgrade or downtime cycles
⚫ Leading technology innovation in AI, robotic automation, voice, and conversational UX
⚫ The interface design drives rapid user acceptance and adoption
Delivery model
and pricing
⚫ Implementation, configuration, and solution design carried out by GEP procurement specialists
⚫ Cloud-native for optimum security, scalability, and performance
⚫ Deployed in whole or in part according to customer needs
⚫ Individual functions or groups of functions can be subscribed-to as required, giving maximum flexibility
⚫ User-based subscription fees, bundled-in FTE pricing for support, and implementation fees
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Strengths Areas of improvement
⚫ GEP strengthened its position as a Leader, driven by strong growth in PO
contracts as well as its strategic sourcing expertise and technology
capabilities
⚫ It registered tremendous increase in deployments of SMART by GEP, its
proprietary cloud-based end-to-end S2P platform, and further
strengthened its capabilities by adding the following innovative offerings:
– An AI-assisted conversational reporting and analytics tool, which uses
NLP to generate reports by directly processing user speech
– An AI-driven duplicate invoice identification tool and an intelligent
invoice capture tool
– A contracts planning robot, which leverages RPA and advanced
analytics to generate contract management insights
⚫ To enhance its category and process expertise, it continued investments
in talent development through CoE and CAGs
⚫ It has a well-balanced shoring mix and has increased delivery presence in
APAC, Eastern Europe, and North America
⚫ Buyers appreciated GEP’s strategic sourcing and procurement expertise,
technology, agility and flexibility, and responsiveness
⚫ Compared to its peers, GEP has limited downstream procurement
capabilities. It can look to further strengthen its P2P capabilities to
develop a stronger end-to-end procurement offering
⚫ Scope exists to strengthen its clientele in the emerging markets of
APAC, MEA, and Latin America
⚫ Some buyers expect GEP to be more proactive and improve its
benchmarking services
⚫ GEP also needs to focus on marketing its innovative offerings to clients,
as these are relatively new and many of their clients are not leveraging
them. As a result, these clients have rated GEP low on next-generation
digital capabilities
Market impact Vision & capability
Market
adoption
Portfolio
mix
Value
delivered Overall
Scope of
services offered
Innovation and
investments
Delivery
footprint
Vision and
strategy Overall
Measure of capability: High Low
GEP | PO profile (page 5 of 5)
Everest Group assessment – Leader
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Appendix
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Strategy (in-house)
⚫ Mission strategy / corporate strategy
⚫ Business strategy
⚫ Geographic strategy
⚫ Technology strategy
Spend data management Strategic sourcing Vendor management
⚫ Baseline analysis
⚫ Data “cube” construct
⚫ Opportunities’ definitions
⚫ Sourcing strategy
⚫ Vendor selection
⚫ Contracting
⚫ Sourcing implementation
⚫ Category management
⚫ Vendor relationship management
⚫ Contract administration
⚫ Service level/standards monitoring
Requisition to PO Invoice processing Accounts payable and T&E
⚫ Approval workflow
⚫ Material requisition
⚫ Purchase order
⚫ Expediting/ troubleshooting
⚫ Material/invoice receipt
⚫ Invoice payment
⚫ Master data maintenance
⚫ Process payment request
⚫ T&E claims processing
⚫ EDI/P-card1 administration
⚫ Month-end closing
⚫ Vendor inquiries
⚫ Reporting
Procurement systems Performance management
⚫ E-auctions
⚫ Catalog management
⚫ Solution hosting
⚫ Financial performance
⚫ Compliance management
⚫ Policies and procedures
⚫ Performance and results reporting
Strategy
Transactionintensive
Judgmentintensive
Procurement pyramid (non-core spend)
S2C
P2P
S2P
Everest Group PO process map
Everest Group distinguishes between the Source-to-Contract (S2C)
and Procure-to-Pay (P2P) processes
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Beyond the process dimension, PO contracts also have a
“procurement-spend category” dimension
Direct
spend
Indirect
spend
Core
spend
⚫ Goods and services that are key ingredients to
manufacture/deliver the final product/service
⚫ They are proprietary or specific to the organization
⚫ For example: Iron ore for a steel manufacturer and
rubber for a tire manufacturer
Source-to-Contract
(S2C)
Procure-to-Pay
(P2P)
Source-to-Pay (S2P) cycle
⚫ Goods and services that are commonly required to
manufacture/deliver the final product/service
⚫ They are commodities in that industry
⚫ For example: Lubricants, packaging, and
Maintenance, Repair, & Overhaul (MRO)
⚫ Non-production goods and services that are not
required to manufacture/deliver the final
product/service but are required to operate the
organization
⚫ For example: Spend categories such as facilities,
office supplies, travel & logistics, marketing-/sales-
related spend, and IT/telecom
High prevalence of third-party outsourcing Low prevalence of third-party outsourcing
Non-core
spend
Non-core
direct
spend
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Everest Group PEAK Matrix™ is a proprietary framework
for assessment of market impact and vision & capability
Everest Group PEAK Matrix
Vision & capability
Measures ability to deliver services successfully
High
Low
Low High
Leaders
Aspirants
Ma
rke
t im
pa
ct
Measure
s im
pact cre
ate
d in the m
ark
et
Major Contenders
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Services PEAK Matrix™ evaluation dimensions
Measures impact created in the market –
captured through three subdimensions
Market adoption
No. of clients, revenue base, and
YOY growth, deal value/volume
Portfolio mix
Diversity of client/revenue base
across geos and type of
engagements
Value delivered
Value delivered to the client
based on customer feedback
and transformational impact
Vision and strategy
Vision for the client and itself;
future roadmap and strategy
Scope of services offered
Depth and breadth of services
portfolio across service sub-
segments / processes
Innovation and investments
Innovation and investment in the
enabling areas, e.g., technology
IP, industry/domain knowledge,
innovative commercial
constructs, alliances, M&A, etc.
Delivery footprint
Delivery footprint and global
sourcing mix
Measures ability to deliver services successfully.
This is captured through four subdimensions
Mark
et
imp
act
Vision & capability
Major Contenders
Leaders
Aspirants
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Everest Group confers the Star Performers title on providers
that demonstrate the most improvement over time on the
PEAK Matrix™
Star Performers
are identified by
top quartile
performance
improvement on
the X and Y axes
for each segment
Methodology
Everest Group selects Star Performers based on the relative YOY improvement on the PEAK Matrix
Year 1
Year 0
Ma
rke
t Im
pa
ct
Vision & capability
We identify the service providers whose improvement
ranks in the top quartile and award the Star Performer
rating to those service providers with:
⚫ The maximum number of top-quartile performance
improvements across all of the above parameters
AND
⚫ At least one area of top-quartile improvement
performance in both market success and capability
advancement
The Star Performers title relates to YOY performance for a given service provider and does not reflect the overall
market leadership position, which is identified as Leader, Major Contender, or Aspirant.
In order to assess advances on market impact,
we evaluate each service provider’s performance
across a number of parameters including:
⚫ Yearly ACV/YOY revenue growth
⚫ # of new contract signings and extensions
⚫ Value of new contract signings
⚫ Improvement in portfolio mix
⚫ Improvement in value delivered
In order to assess advances on vision and
capability, we evaluate each service provider’s
performance across a number of parameters
including:
⚫ Innovation
⚫ Increase in scope of services offered
⚫ Expansion of delivery footprint
⚫ Technology/domain specific investments
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FAQs
Does the PEAK Matrix™ assessment incorporate any subjective criteria?
Everest Group’s PEAK Matrix assessment adopts an unbiased and fact-based approach (leveraging service provider / technology vendor RFIs and
Everest Group’s proprietary databases containing providers’ deals and operational capability information). In addition, these results are validated /
fine-tuned based on our market experience, buyer interaction, and provider/vendor briefings
Is being a “Major Contender” or “Aspirant” on the PEAK Matrix, an unfavorable outcome?
No. The PEAK Matrix highlights and positions only the best-in-class service providers / technology vendors in a particular space. There are a number of
providers from the broader universe that are assessed and do not make it to the PEAK Matrix at all. Therefore, being represented on the PEAK Matrix is
itself a favorable recognition
What other aspects of PEAK Matrix assessment are relevant to buyers and providers besides the “PEAK Matrix position”?
A PEAK Matrix position is only one aspect of Everest Group’s overall assessment. In addition to assigning a “Leader”, “Major Contender,” or “Aspirant” title,
Everest Group highlights the distinctive capabilities and unique attributes of all the PEAK Matrix providers assessed in its report. The detailed metric-level
assessment and associated commentary is helpful for buyers in selecting particular providers/vendors for their specific requirements. It also helps
providers/vendors showcase their strengths in specific areas
What are the incentives for buyers and providers to participate/provide input to PEAK Matrix research?
⚫ Participation incentives for buyers include a summary of key findings from the PEAK Matrix assessment
⚫ Participation incentives for providers/vendors include adequate representation and recognition of their capabilities/success in the market place,
and a copy of their own “profile” that is published by Everest Group as part of the “compendium of PEAK Matrix providers” profiles
What is the process for a service provider / technology vendor to leverage their PEAK Matrix positioning and/or “Star Performer” status ?
⚫ Providers/vendors can use their PEAK Matrix positioning or “Star Performer” rating in multiple ways including:
– Issue a press release declaring their positioning. See citation policies
– Customized PEAK Matrix profile for circulation (with clients, prospects, etc.)
– Quotes from Everest Group analysts could be disseminated to the media
– Leverage PEAK Matrix branding across communications (e-mail signatures, marketing brochures, credential packs, client presentations, etc.)
⚫ The provider must obtain the requisite licensing and distribution rights for the above activities through an agreement with the designated POC at
Everest Group.
Does the PEAK Matrix evaluation criteria change over a period of time?
PEAK Matrix assessments are designed to serve present and future needs of the enterprises. Given the dynamic nature of the global services market and
rampant disruption, the assessment criteria are realigned as and when needed to reflect the current market reality as well as serve the future expectations
of enterprises
About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business
services, and sourcing. We are trusted advisors to senior executives of leading
enterprises, providers, and investors. Our firm helps clients improve operational
and financial performance through a hands-on process that supports them in making
well-informed decisions that deliver high-impact results and achieve sustained value.
Our insight and guidance empower clients to improve organizational efficiency,
effectiveness, agility, and responsiveness. What sets Everest Group apart is the
integration of deep sourcing knowledge, problem-solving skills and original research.
Details and in-depth content are available at www.everestgrp.com.
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