gartner reprint

25/5/2016 Gartner Reprint

http://www.gartner.com/doc/reprints?id=130PCSPQ&ct=160308&st=sb 1/42

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Magic Quadrant for Customer Management Contact Center BPO28 January 2016 | ID:G00273869

Analyst(s): TJ Singh, Misako Sawai, Brian Manusama

SummaryGartner's Magic Quadrant for customer management contact center business processoutsourcing services evaluates a vibrant provider landscape. Sourcing managers need toknow that the provider landscape is changing due to evolving technology, economicconditions and customer needs.

Market Definition/DescriptionGartner defines business process outsourcing (BPO) as the delegation of one or more IT-enabled business processes to an external provider that, in turn, owns, administers andmanages the processes and agreed-upon outcomes based on predefined performancemetrics. Outsourced processes include knowledge-based processes, as well as transactionalones, include the support and administration of front-, middle- and back-office activities, andaddress all levels of predefined volumes. Almost any business process or part thereof can beawarded to a BPO provider, and oftentimes, the boundaries are regularly widened to includemore, and more-sophisticated, processes. Entire processes or discrete subprocesses can beoutsourced in order to form end-to-end, comprehensive service arrangements.

BPO providers aim to offer buyers increased efficiency, decreased cost, greaterstandardization, operational scalability, and higher quality of process activity by reducing oreliminating human labor through application of their domain expertise, processmethodologies (such as for process redesign or transformation) and often (but not always)multiclient management. BPO services may incorporate access to domain or functionalexperts, process engineers and project management staff in addition to the technology foradministering the processes. In most cases, the inherent risk and responsibility associatedwith the delivery of the outsourced processes (and agreed-upon outcomes) belong to theservice provider, but this is not always the case; these responsibilities are outlined in thecontract's statement of work.

Providers' foundational software platform and their process enhancement technologies andservices (PETS — please see "Achieving Excellent Business Outcomes via Business ProcessOutsourcing and Captive Shared-Service Centers" ) can include proprietary, purchased third-

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party or freely available software, and often a combination of all three types. Additionally, BPOservices are sometimes combined with IT outsourcing (ITO) services by a single provider inorder to reduce the total cost through a combined offering.

Customer Management Contact Center BPO Defined

Customer management (CM) contact center BPO, which comprises the processes linking anorganization with its existing and potential customers, can be categorized in foursubsegments:

Customer selection

Customer acquisition

Customer extension

Customer retention

The above four subsegments are normally executed across the following four primarychannels:

Telephony, inclusive of voice and interactive voice response (IVR) self-service

Email response management, SMS, text services and mobile applications

Web chat and social CRM services

Knowledge management for Web-based self-service

Customer Selection

Customer selection BPO services include the following: market segmentation and dataanalysis (including the collection, management, augmentation, analysis and application ofcustomer data in support of marketing and sales efforts); campaign design andcommunication planning (including media campaign creation, integration, deployment,tracking and measurement); and other customer selection (including testing, brand planning,account/territory planning, product introduction and other customer selection functions notincluded in the above categories).

Customer Acquisition

Customer acquisition BPO services include telesales, telemarketing, Web sales, Webmarketing, mobile sales, mobile marketing, social marketing (including crowdsourcingplatforms), lead management/opportunity management and field sales automation.

Other customer acquisition includes direct mail campaign management, channelmanagement, proposal generation, solution design, negotiation, deal closing and othercustomer acquisition functions that are not included in the above categories.

Customer Extension



Customer extension BPO services encompass customer upsell/cross-sell, which includesidentifying existing products and services purchased by a customer and using thatinformation to influence the purchase of associated products and services across allchannels — voice, Web chat, email, Web self-service, mobile apps, social CRM (includingcrowdsourcing platforms), business process as a service (BPaaS), customer data analytics tosupport customer service and support processes, and other sales, marketing and customercare processes. Other customer extension services include the need for reassessment,campaign management and other customer extension functions that are not included in theabove categories.

Customer Retention

Customer retention BPO services include customer service processes for inquiryhandling/problem resolution, field service automation and customer self-service functions.Inquiry handling and problem resolution includes managing customer concerns eitherthrough outbound or inbound communications over the telephone, Internet or mobile devicesor face-to-face. Field service automation includes managing personnel resource allocation,communication of problem tickets, diagnostics, spares inventory and preventive maintenancein the field service and repair organization. Other customer retention includes ordermanagement, repair and return handling, attrition management, and other customer retentionfunctions that are not included in the above categories.

For the purpose of this Magic Quadrant research, Gartner assessed 22 service providers thatoffer comprehensive CM contact center BPO service offerings. Customer-facing processesthat providers offer come from across all four subsegments that make up CM contact centerBPO.

Excluded from this research are:

Accounts receivable management (collections).

HR or other enterprise services (for example, payroll, recruitment or benefitsadministration).

Field sales automation — This includes management and administration of face-to-faceinteractions between sales teams and clients. The four types of field sales models are:influencer (using industry experts); opportunity-driven (primarily used for large-valueproducts); project-driven (used for selling professional services); and iterative (based onongoing relationships, such as consumer packaged goods).

Magic QuadrantFigure 1. Magic Quadrant for Customer Management Contact Center BPO



Source: Gartner (January 2016)

Vendor Strengths and Cautions

Aegis

Aegis is ranked as a Challenger in this year's report. Aegis has worldwide CM contact centerBPO revenue of approximately $500 million. Headquartered in India, the company has anestimated 40,000 employees based in 43 centers across nine countries, with the majority(70%) based out of India. After the sale of Aegis' U.S. business to Teleperformance, it has aremaining head count of 40,000 across its centers. Aegis is wholly owned by Essar, a $35billion diversified business conglomerate. Aegis' primary focus is on multichannel CM andvertical industry markets, including telecommunications, financial services, healthcare, energyand utilities, retail and consumer goods, and travel and hospitality.



Aegis continues to have an aggressive organic and inorganic growth strategy. It plans to usethe money raised from the sale of its U.S. business to make more acquisitions in Asia, Africa,Latin America and the Middle East. This is in line with its strategy to grow higher-marginbusinesses. Aegis considers telecom and banking, financial services and insurance (BFSI) asits key verticals for growth. However, the company is also investing in emerging verticalssuch e-commerce, government and travel. It also plans to increase its share of nonvoicebusiness from current 25% to 40% or 45% within the next few years. Aegis has sizable ITservices capabilities — Enterprise Business Services, which can provide the necessarytechnology capabilities and assets needed across Asia/Pacific. The company has invested indigital and social media business engagement and solutions through its product — AegisLISA . The company is also looking at including CM analytics as one of the key imperativesfor its BPO engagement and contracts.

STRENGTHS

Aegis continues to strengthen its presence and capabilities in key markets such asAsia/Pacific and EMEA. Aegis has invested $4 million in a new center of excellence inMelbourne, Australia, which focuses on analytics, social media and multilingual capabilitiesto support customers from multiple industries across their CM value chain.

Aegis leverages digital media platforms and customer experience analytics, which haveenabled it to provide high levels of customer experience to its clients. The company alsohas a strong IT and technology division — Enterprise Business Services.

Some clients cite strong operational management, a focus on relationship (having aconsultative and partnership approach), responsiveness, flexibility when dealing with clientissues, project management skills, and value for money as key strengths.

CAUTIONS

Aegis has a limited presence in North America due to the sale of its U.S. business(including the Philippines) to Teleperformance. Global clients that require significantonshore presence for service delivery in North America may face some challenges.

The company needs to invest more in thought leadership and consulting capabilities tosupplement its centers of excellence. The company needs to further grow its multichannelservice capabilities — for example, the development of customer experience hubs.

Some clients cite an inconsistent approach to training and governance — governancestructures, the sharing of innovation and benefits thereafter, succession planning, limitedknowledge management, and analytics services — as key concerns.

Alorica

Alorica is ranked as a Leader in this year's report. U.S.-based Alorica provides end-to-end CMoutsourcing solutions, including customer acquisition and sales, customer care and technicalsupport, logistics, and fulfillment. Alorica's outsourcing services cover both the business-to-

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consumer and business-to-business segments across the following vertical industries:automotive, energy and utilities, financial services, government services, communications,retail, healthcare and insurance, manufacturing, travel and transportation, and technology.The company employs over 48,000 across 73 locations in the U.S., Honduras, Brazil, theDominican Republic, Mexico, Jamaica and the Philippines. The company's recent acquisitionof West's agent service businesses with annual revenue of $580 million will bring thecombined annual revenue of the company to more than $1.2 billion.

As part of its strategy to consolidate its position in the contact center business, Aloricaacquired West's agent service businesses at the beginning of 2015. The acquisition will helpenhance Alorica's capabilities in healthcare solutions and receivables management. Aloricawill also benefit with more than 5,000 work-from-home agents crucial for just-in-time staffingfor rapid deployments or unpredictable volumes.

STRENGTHS

Alorica has long-term engagements with its clients and an employee base that has furthersolidified due to the acquisition of West's agent service businesses. Its leadership team hashistorically strong vision and execution capabilities, even further enhanced with theaddition of two new executives this year and the gain of executive talent with tenure andexperience as a result of the acquisition.

With the West agent service acquisition, the company benefited from a Center of AnalyticalExcellence with capabilities including data mining, predictive modeling, operationsresearch, and advanced analytics using statistical algorithms. The company can leveragethese capabilities to augment its service portfolio by wrapping around its core offerings ordevelop them as stand-alone offerings to create an all-new revenue segment.

Some clients cite strong leadership with a partnership approach to client management,highly trained and engaged staff, scalability, flexibility, industry knowledge, focus on qualityand training, consistent service delivery across sites and readiness for change as keystrengths.

CAUTIONS

Though Alorica is investing in new geographical locations in the Caribbean, South Americaand Asia/Pacific, the company continues to maintain focus and concentrate on NorthAmerica. European-based clients may have limited service delivery options.

Clients must be aware and manage any risk (such as IT, operational and business process)to their business, especially during the integration period. As with any large merger andacquisition (M&A) transaction, there is always a risk associated with business integration.Alorica has deployed a dedicated internal project team to help manage the business risk toclients with frequent communication to both employees and clients.



Some clients cite limited global presence (Europe and Asia/Pacific), responsiveness,limited bilingual language capabilities, limited consulting capabilities (Six Sigma/lean) andchange management, and project implementation as key challenges.

Atento

Atento is ranked as a Leader in this year's report. Atento is the largest CM BPO company inCentral and Latin America — by head count (full-time equivalent [FTE] employees) — and iscontinuing its strategy effectively. With a strong growth strategy, it strengthened its marketleader position. The company now employs more than 160,000 employees across 98 centersin 14 countries in Europe, Africa, and Central and Latin America. The company has a highlyexperienced management team that unites long-term experience in the sector with localtalent and know-how. During the transition to become an independent company, Atento hasbuilt a world-class management team. It has a mandate to focus on growth, including innontraditional markets, such as the U.S. nearshore market, and in new service and solutionofferings, such as multichannel and analytics services. This focused strategy and disciplinedexecution is driving consistent above-market growth, improved profitability and a strongerbalance sheet.

Atento has a large client base of more than 400 corporations and governments, most ofwhich are based in emerging markets. Its focus is on industries such as communications,banking and financial services, utilities, government, retail, and travel and transportation.Atento also is capable of having a maintained people focus as a competitive element, whichresulted in recognition for the fifth consecutive year as one of "The Best Companies to workfor in LatAm" and the only CM BPO company to be recognized as one of "The World´s Best 25Multinational Workplaces" by Great Place to Work for three years in a row.

STRENGTHS

Atento consolidated a leadership position in its key markets. Its growth rate, scale andleadership position in Latin America drives further industry consolidation, as evidenced byAtento overtaking Contax in 2014 to become the top service provider in Brazil in marketshare terms. It is uniquely positioned to capitalize on current market and industrydynamics.

Atento leverages its long-term relations with its clients, and the company adopts aconsultative sales methodology when positioning value-added multichannel and analyticsservices. Atento shows initiative to adapt to business dynamics, increasingly providing self-service, automation and optimization of CRM processes. Atento understands that thecustomer needs to provide multichannel integration in order to provide higher levels ofcustomer experience.

Several clients cite service delivery experience, market and industry knowledge,management capabilities, time to market, agility, flexibility, focus on results, projectexecution, and the ability to scale (scalability) as key strengths .

CAUTIONS



CAUTIONS

Atento continues to have a relatively high level of vertical/industry concentration. Also,despite the clear growth focus on the U.S., a significant portion of Atento's service deliverycapacity and offerings are positioned for the Spanish- and Portuguese-speaking markets.

Atento also has high client concentration — the company generates 82.1% of its revenuefrom the top 15 customers, with 46.5% from Telefónica Group alone.

Some clients cite high attrition and absenteeism, limited innovation and sharing of newcapabilities, response time, speed to adopt changes, and limited capability in complextechnology integration as key cautions.

Concentrix

Concentrix is ranked as a Leader in this year's report. Concentrix, a wholly owned subsidiaryof Synnex, has operations across 25 countries, with approximately 90 delivery centers. It hasmore than 70,000 employees servicing more than 300 clients in more than 40 languages. Thecompany has a large delivery footprint in India, the Philippines, Europe, Asia/Pacific, NorthAmerica and South America. Concentrix has expertise in 10 industries and offers enhancedcapabilities in advanced analytics, enabling technologies and nonvoice services. Concentrixdelivers services by voice, mobile, social and Web chat across multiple geographies.

The company operates with a holistic view that includes all customer touchpoints in amultichannel (omnichannel) approach. Concentrix focuses on the following industries:banking and financial services, healthcare and pharmaceutical, insurance, technology,consumer electronics, retail and e-commerce, government and public sector, media andcommunications, automotive and travel, transportation and tourism.

STRENGTHS

Concentrix continues to leverage its strong and extensive vertical/industry capabilities,process knowledge and skills, and global reach to transform and optimize operationsacross the customer life cycle. The company also delivers strategic insight, and extensiveoperational expertise to help clients achieve their customer experience objectives andrealize tangible results.

The company continues to demonstrate its ability to deliver digital and multichannelnonvoice services, automation and analytics services as it continues to acquire new clients.

Some clients cite strong management, flexibility, partnership approach, ability to scale, andfocus on quality as key strengths.

CAUTIONS

Although a lot of progress has been made, Concentrix is still growing in recognition andbrand equity among CM contact center BPO clients, especially in the small or midsizebusiness (SMB) market.



The company needs to continue its investment in thought leadership, consulting, changemanagement, centers of excellence, and CM BPaaS to help deliver new and innovativeservices to clients.

As key cautions, clients cite leadership development with a specific need to invest more inlearning and development; infrastructure; technology and software (technical) supportcapabilities; and service consistency.

Convergys

Convergys is ranked as a Leader in this year's report. Convergys is one of the largest CM BPOcompanies, with revenue of over $3 billion and 125,000 employees working in more than 150service centers in 31 countries. The company has clients in all the key countries in theAmericas, EMEA and Asia/Pacific. Its recent acquisition of Stream Global Services hasexpanded the company's geographic footprint and service capabilities, and has addedapproximately 40,000 employees in 22 countries.

Convergys operates in four business segments: communications, technology, financialservices and the "others" segment. The company is expanding its already sizable business inthe financial services, healthcare and retail sectors with the signing of several new customercontracts in 2015. Convergys is delivering quality customer experiences with the help of its75 contact centers in the U.S., the Philippines, India, Costa Rica, Colombia, Canada, the U.K.and other international markets.

STRENGTHS

Convergys continues to expand as a company with continual workforce hiring at variouslocations, such as Costa Rica, the Philippines, Phoenix and other locations, enabling thecompany's strategy toward strengthening human resource capabilities. The acquisition ofStream has helped the company to strengthen its technology service business and hasbeen successful in bridging the geographical concentration in Europe and the LatinAmerican market.

Convergys is entering into various partnerships to expand its analytical capabilities. Itsrecent partnerships with Clarabridge to expand text analytics and with Nexidia for itscustomer interaction analytics technology solutions signify the growing analytical focus ofthe company. The company has also introduced a proprietary, embedded analyticsoutcome accelerator solution.

Some clients cite speed of implementation, ability to scale, responsiveness, flexibility,global presence (assets and locations), strong methodologies, and engaged seniormanagement with a partnership approach as key strengths.

CAUTIONS



Convergys continues to have a high level of client concentration — its top three clientscollectively represented over 31% of the revenue. Consistent with the majority of theindustry, the company also has a high vertical/industry concentration in communications —approximately 55% of the company's revenue. The recent acquisition of Stream has broughtwith it a broad client and industry base.

The company has strong legacy in IVR and analytics services and has continued to developits offerings and capabilities in this area that respond to client demand. However, thecompany needs to continue to invest in enhancing its digital and analytics capabilities inthe areas of multichannel, automation (such as virtual assistance), thought leadership andconsulting capabilities (centers of excellence, CM BPaaS and advanced analytics services)to help deliver new and innovative services to clients.

Some clients cite agent attrition, sharing of best practices and innovation across all clients,higher unit cost of service, French nearshore limited to Tunisia, and the ability to attract andretain top talent as key cautions. Gartner is, however, aware that the company has attractedseveral senior employees with significant industry and vertical experience during 2015.

EGS

Expert Global Solutions (EGS) is ranked as a Leader in this year's report. EGS has revenue ofapproximately $1.1 billion from BPO services. The company employs over 40,000 FTEemployees — including 750 work-at-home (WAH) agents — who are dedicated to BPOservices across more than 70 contact center locations in 11 countries. EGS focuses on fiveelements: maintaining a strong client mix across multiple vertical markets; remaining apreferred Tier 1 provider; expanding globally in key markets (onshore, nearshore andoffshore); having a strong financial position; and being recognized as a leader in the BPOmarket.

From an industry perspective, EGS focuses on technology, communications, financialservices, retail, travel and transportation, utilities, healthcare and pharmaceuticals. EGS is astrong CM contact center BPO service provider in the healthcare market. The company hasinvested heavily in assets and capabilities in healthcare, with a strong focus on pharmacytechnician (pharm tech) and pharmacist positions in support of pharmacy benefits managers(PBM). This is in addition to the two licensed nondispensing pharmacies the companycurrently operates. In 4Q15, EGS made significant investments in its Customer ExperienceTransformation (CxT) consulting practice, formalizing a team of client-facing consultants andthe implementation of automated technology tools.

STRENGTHS

EGS has made significant investments in its global delivery capabilities across three keymarkets — Philippines, Latin America and the U.S. These strategic investments, supportedby colocated senior management and new Tier 3 data centers, enable clients to broadentheir geographic diversity while maintaining quality and cost-effectiveness.



The company is expanding and investing in innovative offerings centered around digital,multichannel, automation and analytics services, including its Customer ExperienceTransformation (CxT) methodologies, multichannel self-service capabilities focused ontransitioning contact volumes to cost-effective, nonvoice channels, and integratedmultichannel solutions and services deployed across customer engagement centers.

Some clients cite a strong leadership team, agility and flexibility, focus on clients, easyaccess to management, scalable solutions and services, and a sense of partnership as keystrengths of EGS.

CAUTIONS

EGS is improving with the addition of new clients and a focus on vertical diversification, butit has a high level of concentration in the telecommunications and healthcare sectors,although the risk is spread across dozens of customers. The company also has limited butgrowing thought leadership and CM consulting capabilities — especially with the recentinvestment in its Customer Experience Transformation (CxT) consulting practice.

The company has a high geographical concentration in North America, but it continues togrow its market visibility and brand awareness outside the U.S. Also, EGS is still heavilyfocused on voice — over 85% of its total revenue, as its primary contact channel. With itscurrent strategy and investments, the company needs to aggressively increase thenonvoice service revenue.

As key cautions, some clients cite agent attrition, IT infrastructure and technologyimplementation thought leadership, account management turnover, and the lack ofmarketing services.

Firstsource

Firstsource is ranked as a Niche Player in this year's report. Firstsource is the leading CMcontact center BPO service provider based in India. The company is part of the diversified RP-Sanjiv Goenka group. The company has a revenue of approximately $500 million with over25,000 FTE agents across 46 centers in five countries providing services to over 100 clients.

Firstsource is focused on the following key vertical/industry sectors: telecommunicationsand media; banking and financial services; insurance; healthcare; and publishing. Thecompany currently has sizable operations in India, the Philippines, Sri Lanka, the U.K. and theU.S. The company has invested and built key CM BPaaS offerings in Web chat, analytics andautomation services, such as First Chat, First Customer Intelligence and First Smartomation.The company's Web chat and digital services are supported by over 1,000 agents dedicatedto U.K. and U.S. clients. Results include Firstsource's innovative digital-community-basedproposition for a telco client that reduces agents required by over 70%.

STRENGTHS



The company has deep industry and process knowledge specific to the banking, financialservices and insurance (BFSI) sectors. The company continues to grow its brandawareness and brand affinity in key markets, such as the U.K. and North America.

Firstsource has an extensive voice-based service offering for CM contact center BPOservices, and it continues to invest in multichannel and social CRM services. It has a uniqueset of platform offerings such as First Chat, First Customer Intelligence, FirstSmartomation, First Resolve and First WF Suite.

Some clients cite good responsiveness, strong Web chat capabilities, good cultural fit, goodfunctional capabilities, fast turnaround time for issues and good program managementcapabilities as key strengths of Firstsource .

CAUTIONS

The company's primary focus is on Asia/Pacific, North America and the U.K. Besides locallanguage support in India, the company's focus elsewhere is only on English-language-based services; it has limited scale in other languages.

The company has a high level of vertical/industry concentration in communications andBFSI, and disproportionately high levels of client concentration in North America andEurope. Losing one of these clients could have a financial impact on the company; it isinvesting in sales to expand its client base.

Some clients cite cost of service, ability to be proactive in recommending processimprovement and limited geographical presence as key cautions.

FIS

FIS is ranked as a Challenger in this year's report. The company's CM contact center BPObusiness has revenue of over $600 million and employs more than 19,000 CM contact centerBPO employees who support clients from locations across North and Latin America, Europe,India and the Philippines. FIS offers CM contact center BPO services as a stand-alone serviceoffering or as part of a bundled BPO and IT outsourcing offering that gives the company theability to provide end-to-end solutions.

Its CM contact center BPO services include marketing, sales, customer service and support.The company has developed a proprietary analytics platform — the FACTs Store — whichfocuses on improving brand, reducing operating expense and increasing revenue and alsodeploys a holistic learning management solution — FIS Learning Integrated PerformanceSuite (FLIPS). The tools and methodologies delivered on the platform include Evangelize andOneView to help clients deliver intelligent and consistent services that improve customerexperience.

The company has continuously invested in digital service consulting capabilities to assistclients to go through their digital journey while remaining competitive and scaling theirbusiness. The company generates a significant portion of its revenue from the following



vertical industries: banking and financial services, communications, retail and healthcare. FISleverages its deep domain expertise and footprint in digital and multichannel services andhas signed numerous new agreements concentrated on providing digital services. FIS'sdigital BPO practice is focused on delivering seamless digital and multichannel servicecustomer experiences. The company continues to grow domain and process expertise,leveraging its strong and extensive capabilities and process transformation skills.

STRENGTHS

FIS has a strong financial and cash-flow position and good client concentration — only 5%of its total revenue is derived from its top five clients. FIS revenue from digital,multichannel, automation and analytics services is approximately 40%, making thecompany one of the leading providers of nonvoice CM contact center BPO services.

FIS focuses on delivering innovative solutions to its clients and has invested in resources,technologies and partnerships to enhance BPO capabilities with new offerings such ascustomer interaction analytics (predictive and prescriptive), digital consulting, roboticprocess automation and learning management solutions.

Some clients cite key strengths in security capabilities, domain and industry expertise,agility, service flexibility, responsiveness, timeliness (including rapid deployment services),and the ability to lead and advise on digital and multichannel services.

CAUTIONS

FIS currently has limited presence and brand recognition in the EMEA and Asia/Pacificmarkets, with more than 85% of its revenue concentrated in the Americas. The companyalso has a disproportionately large industry concentration in financial services — nearly70% of its CM contact center revenue comes from the banking and financial industry.

The CM contact center BPO business unit currently contributed under 10% of the group'srevenue but maintains nearly 50% of the group's FTE staff. The level of investment madeinto this business is important to clients, as it shows the commitments to innovation andnew offerings to help clients. This may be strained over time as the FIS group looks toimproved margins as a key consideration for future investments.

Clients cite agent training and development, agent attrition, ability to formalize clientgovernance structure, lack of onshore delivery capacity in Europe, price flexibility, changemanagement and technical capabilities (CRM solutions) as key cautions.

HGS

HGS is ranked as a Niche Player in this year's report. HGS, a member of the Hinduja Group ofcompanies, is a business process management (BPM) service provider with an approximaterevenue of $458 million. It delivers customer services in 12 countries. In the 60 centers, thecompany employs more than 29,000 contact management workers. The company has a fast-growing footprint in North America and India, with nearly 45% of the business revenue



originating from North America. HGS operates the services mainly in four sectors: healthcareand insurance; financial services; telecommunications; and consumer goods. HGS isinvesting heavily in the "agent anywhere" proposition and focuses strongly on providingexcellent customer experience through its multichannel strategy — unified channel strategy.The company has a keen interest in expanding to Latin America and the Middle East in thenear term and is expected to continue with acquisitions to strengthen its presence in new, aswell as in existing, markets.

The company continues to invest significantly in acquisitions across verticals/industries. Theacquisition of Colibrium, a cloud-based sales, service and wellness automation platform,brings in complementary platform and servicing capabilities in the sales and enrollment areafor the U.S. and global health insurers. Health insurance plans using the Colibrium platformwill be 30% to 40% more efficient in acquiring new members and providing services over thecourse of the customer life cycle. Similarly, the acquisition of Mphasis' India domestic BPObusiness strengthens HGS's presence in India by adding newer service capabilities andclients in the telecom and banking, financial services and insurance (BFSI) sectors.

STRENGTHS

HGS continues to invest in services such as digital, multichannel and analytics services thatprovide cutting-edge revenue-generation models. This is evident with the recent acquisitionof Colibrium, a cloud-based sales, service and wellness automation platform, specificallytargeted for U.S. and global health insurers.

HGS maintains continued traction in the healthcare segment. The company is expected tobenefit significantly from the healthcare reforms in the U.S. due to its strong domainexpertise in the vertical and all round presence in entire healthcare value chain.

As key strengths of HGS, some clients cite responsiveness, focus on customer experience,ability to scale, strong leadership, speed to market, ability to staff quickly, focus on cost,flexibility and receptivity to feedback.

CAUTIONS

HGS shows an unbalanced and high customer concentration with the top 10 clientscontributing 62% of its total revenue, and more than 77% of its revenue derived from the top20 customers. The company also has high industry concentration in the communicationsand healthcare-related markets — approximately 60% of the total revenue derived from boththese industry sectors. The risk to clients due to high levels of client and industryconcentration, though minimal, should still be assessed by clients.

The company needs to invest more in thought leadership and consultative sellingcapabilities as it looks to enhance its digital, multichannel services, as well as engage newbuying centers and develop new business models. Clients looking for a provider that willhelp them innovate and provide thought leadership in customer experience need to assessthis caution.



Some clients cite limited sharing of technology and process innovation, internal ITcapabilities and assets, ability to execute on client governance models consistently,consistency in training, and quality of service as key challenges.

HPE

Hewlett Packard Enterprise (HPE) is ranked as a Challenger in this year's report. HPE offers awide portfolio of BPO solutions focused on business improvement to clients in variousregions across the world. Gartner estimates HPE's CM contact center BPO revenue atapproximately $700 million. The company employs more than 23,000 agents offering sales,marketing and customer care services through 100 global contact centers across 34countries serving 51 languages, specifically for its CM BPO business. HPE's sweet spot is inCM BPO engagements that are focused on digital content and those that require"transformation services" — typically in industries such as healthcare, retail, travel andtransportation, financial services, consumer products, and communications.

The company targets CM contact center BPO deals that are large in scale and require supportof highly complex CM business processes, such as attitudinal, behavioral and demographicsegmentation services, and a multichannel integration platform for marketing, sales,fulfillment and customer-service-based processes. HPE's alliance with Avaya providesexclusivity in cloud customer experience delivery technology. HPE also recently acquiredapproximately 1,100 employees from Avaya Private Cloud Services to provide solutions to themarketplace.

In 2015, HPE invested significantly in upgrading its BPO leveraged platform to an industry-leading multichannel (omnichannel) set of capabilities, including automated and human chat,live agent video, callback assist, proactive marketing, and enhanced social capabilities. HPEnow promotes that its agents are supplied with best-in-class omnichannel technologies whenservicing customers. Also in 2015, HPE significantly upgraded its Transformation andAdvisory Practice to provide strategic CM solutions to clients that leverage HPE's legacystrength in analytics and big data.

STRENGTHS

The HP spin-off into HP Inc. and HPE is expected to be beneficial to the HPE business,more specifically the BPO service business, as it will provide additional resources and areduction of debt at the operating company level, allowing the business to focus andfurther invest in the BPO services business — such as PETS, automation and advancedanalytics. The separation will also allow for greater flexibility in completing the turnaroundof HPE and strengthen the company's CM BPO go-to-market capabilities.

HPE offers a broad range of contact management services. The company has a largecustomer base, and it continues to expand its multichannel, analytics (including its rapidanalytics prototyping capabilities), BPaaS, and social for CRM offerings for its existing and



new client base. HPE currently offers advisory and transformation services focusing onadvanced customer analytics, with approximately 3,600 analytics professionals and 1,200data scientists.

Some clients cite responsiveness, skilled staff/agents and deep domain expertise as keystrengths for HPE. The company continues to address specific customer problems throughfocused use of technologies, vertical industry process expertise and best practices.

CAUTIONS

HPE's CM contact center BPO services have limited brand recognition even within thecompany's existing large customer base. CM contact center BPO service cross-sell andupsell opportunities across HPE's business units are still relatively low.

The company continues to grow its digital, nonvoice multichannel services, analytics andsocial CRM offerings. However, it is still well behind the industry average.

Some clients cite PCI compliance management, somewhat reactive and slow to respond toclient needs, communications within management, relatively slower time to market, highcost of services and limited price flexibility as key cautions.

Intelenet

Intelenet is ranked as a Challenger in this year's report. Intelenet, backed by Blackstone, is a$450 million revenue company with more than 55,000 employees serving clients in the U.K.,India and North America from 62 centers across eight countries. The company providesmiddle- and back-office services across customer contact, transaction and financialprocessing, and related consulting and technology services. Intelenet conducted more than90 million multichannel interactions in 40 languages worldwide, apart from managing 600million calls and 60 million back-office transactions. Blackstone acquired most of Serco'sprivate-sector BPO operations from Serco in late 2015 and rebranded the acquired businessas Intelenet.

The company focuses on the following vertical industries: government, travel andtransportation, communications, media, retail, and financial services. Intelenet continues toexpand its client and geographical concentration and plans to expand significantly into digital,nonvoice multichannel, analytic and marketing services.

STRENGTHS

Intelenet has extensive service offerings and a proactive approach to client relationship andchange management. The company strives to improve oversight, such as increasing thefrequency and transparency of customer engagement, and it continues to invest in formaloversight of delivery of contractual commitments.

The company has a strong presence in the government and banking and financial servicessectors, with deep vertical-industry and process knowledge capabilities. Intelenet iscurrently a leading CM BPO provider in the India and Middle East markets and is expanding



its presence in the U.S., U.K. and European markets.

Some clients cite industry expertise (especially government related), flexibility,responsiveness, transparency, and process expertise as key strengths. Note: Thesestrengths were cited for the former Serco organization.

CAUTIONS

Intelenet has limited geographical presence and brand awareness outside the U.K., NorthAmerica, South Africa, India, Saudi Arabia, the United Arab Emirates and the Philippines.

The company has a high vertical-industry concentration in the government sector (U.K.),transportation (U.S.) and communications (Asia/Pacific), as well as high clientconcentration in the U.K. and North America.

As key cautions, some clients cite limited geographical presence, internal bureaucracy(legal), timeliness (meeting project schedules), and consistency in service quality. Note:These cautions were cited for the former Serco organization.

Minacs

Minacs is ranked as a Niche Player in this year's report. Minacs is a key CM BPO solution andservice provider in North America with a strong presence in the automotive sector, as well asin other manufacturing, retail, telecom, technology, media and entertainment, banking,insurance, healthcare, energy, and public sectors. The company has an estimated revenue ofover $450 million supported by over 21,000 FTE employees across 35 centers in 41languages across North America, Europe and the Asia/Pacific region delivering sales,customer service and support, marketing, and back-office solutions and services with a keenfocus on customer experience.

The company is growing its focus on analytics to better understand the consumer dynamicsand engage accordingly. It has recently integrated with an analytics firm, Ananto, tostrengthen its business intelligence capabilities.

STRENGTHS

The company has a new but experienced leadership team with strong capabilities and trackrecord in CM contact center BPO services. Minacs also has a good and expanding mix ofonshore and offshore service delivery capabilities and assets across North America,Europe and Asia/Pacific.

The company is growing and strengthening its focus and asset base in analytics solutionsand services — such as ALT CRM, with its recent acquisition of Ananto. The company isalso growing its digital, multichannel and social marketing capabilities.

Some clients cite responsiveness, flexibility, program management skills, domainknowledge, strong leadership and relationship management, and strong ability to developand deliver training as key strengths.

CAUTIONS



CAUTIONS

Minacs has a large vertical/industry and client concentration in the automotive sector.Currently just over half of its revenue comes from the automotive sector. It also has a smallclient base in Europe.

Minacs' consulting and thought leadership capabilities and assets, including consultativeselling capabilities, are limited. The company needs to invest more in thought leadership,digital, multichannel services and automation, as well as take advantage of cross-sell andupsell opportunities in its current nonautomotive client base.

Some clients cite limited sharing of best practices, limited IT capabilities (including staff),agent attrition, technology and process innovation, and middle-management skills as keycautions.

Sitel

Sitel is ranked as a Leader in this year's report. Nashville, Tennessee-based Sitel is a $1.44billion CM contact center BPO service provider that employs more than 61,000 FTE and WAHagents who support over 250 clients in more than 40 languages from more than 108 facilitiesacross 21 countries. Sitel was recently acquired by Acticall Group, a France-based CM BPOcompany.

The company continues to have a strong multilingual strategy; one in every four programscurrently run is a multilingual program. Sitel continues to invest in WAH agents, analytics,cloud, mobile and marketing services across its key markets. Sitel has a definedvertical/industry focus, with clients across communications, healthcare, high-tech (Internet,wireless and technology providers), financial services, media and entertainment, retail,transportation and utilities.

Sitel has been increasing its capabilities in handling complex client interactions and customerexperience. The recent acquisition by Acticall places the company in a strong cash position,enabling Sitel to continue to invest in complementary and new service offerings, includingnonvoice multichannel services, Sitel Premium Technical Support, WAH and analytic servicesdriven by clients' needs.

STRENGTHS

Sitel has deep domain, process and industry expertise, especially in growth industries, suchas technology, consumer electronics and communications. Also, the company has one ofthe most diversified revenue concentrations in the industry. Sitel's top 10 clientrelationships represented approximately 36.3% of its revenue in FY14, and the largest clientrepresents only 6% of its annual revenue, all of which points to a well-diversified client andvertical/industry concentration.



The company has strong geographical presence across North America, Latin America,Europe and key locations in Asia/Pacific. It has extensive CM contact center BPO serviceofferings, which include multichannel and analytic capability, across all key regions. It alsohas a strong leadership, adept at managing the demands of multiple stakeholders andmanaging change.

Some clients cite flexibility, responsiveness, operational expertise, customer service skills, astrong senior management team, cultural alignment, recruitment process, key performanceindicator management and analytic offerings as key strengths.

CAUTIONS

Sitel has limited consulting capability, thought leadership skills and technology assets tohelp deliver innovative and business transformation for CM contact center BPO services.The company also needs to keep investing to close the agent skills gap by enhancingongoing processes with talent suppliers and investing in new skills development for middlemanagement leaders who will help clients with the CM contact center BPO services.

The company has limited CM contact center BPO services that address the needs of agrowing small and midsize market and of new hypergrowth digital companies with specificservice offerings and solutions. The company needs to further invest in offerings related todigital services, mobile services, automation and advanced analytics.

Some clients cite as key cautions limited IT capabilities, middle and operationalmanagement staff, ability to manage complexity, and service consistency acrossmultigeography engagements.

Sutherland Global Services

Sutherland Global Services is ranked as a Leader in this year's report. Sutherland GlobalServices, a Rochester, New York-based company, valued at over $1 billion, has more than36,000 employees across more than 40 centers in 14 countries. It derives 40% of its revenuefrom global enterprise clients. It is a global BPO services company providing integratedplatform-based and analytics-enabled business cycle support solutions. Its proprietaryplatform-based technical support services are branded as SmartLeap. The company hasbeen expanding its operations in Europe and announced plans to invest about $11.15 millionin Bulgaria by 2016.

The company's major clients and focus are in communications, technology, retail, banking,insurance, healthcare, logistics, and travel and transportation sectors. It has been witnessingrobust growth with more client prospects likely to be added across its centers globally.

STRENGTHS

Sutherland Global Services uses a global delivery model comprising onshore, nearshore,offshore and CloudSource options. CloudSource is a virtual model enabling its employeesto work from home so that they are geographically distributed as per their client



requirements.

Sutherland Global Services is focused on innovation and continuous service improvement.One of the key focus areas is digital transformation of key internal operations andprocesses. More recently, the company launched a new Healthcare Robotic ProcessAutomation (RPA) center of excellence in Hyderabad, India.

The company aggressively pursues risk sharing and business-outcome-based commercialmodels, which give more credibility to the firm and assurance to its clients.

Some clients cite a strong management team, project management skills, flexibility,responsiveness and good technical capabilities as key strengths of Sutherland.

CAUTIONS

Although Sutherland is making consistent efforts in expanding its footprint in Europe, thecompany is still highly concentrated in delivery to North America and Asia/Pacific. Until itsplanned expansion in Bulgaria by 2016, the company has a relatively limited presence inEurope.

Some industry sources indicate that Sutherland's pricing model is best suited for servicingNorth American clients through global delivery centers. The pricing is not competitiveenough for clients located in other regions, such as Latin America, and the company can beinflexible with changing its pricing structure as per local needs.

Some clients cite relatively higher pricing, limited geographical presence (in EMEA),attrition, recruitment (time to hire) and longer turnaround time for contractual/legalchanges as key cautions.

Sykes

Sykes is ranked as a Leader in this year's report. Sykes has more than 51,000 FTE agentsserving clients from more than 65 centers in more than 21 countries. It has 8,700 virtualcustomer contact agents across 40 states in the U.S. and eight provinces in Canada. Sykesprovides customer care, technical support and acquisition services in more than 30languages. The company acquired Alpine Access in 2012, which helped enhance thecompany's technology assets and service capabilities to deliver WAH-based services. Sykeshas strong geographical presence in North America, Latin America and Asia/Pacific, whichtranslates into a good regional revenue mix. The company continues to focus on banking andfinancial services, communications, technology, consumer electronics, and healthcare.

The company has been steadily acquiring companies over the years with the recent additionbeing that of Qelp, a Netherlands-based provider of self-service software and call centersoftware for smartphones. Sykes plans to grow inorganically by acquiring more companiesgoing forward. It has strong growth in margins and cash flows. The company's operatingprofits increased from $47.8 million in FY12 to $79.6 million in FY14. During the same period,



the company's net profit increased from $28.4 million in FY12 to $57.8 million in FY14 at aCAGR of 43%. The strong growth was driven by new contract sales and higher volumes fromexisting contracts in the Americas and EMEA.

STRENGTHS

Sykes has a diverse global delivery footprint. The company's global footprint includesestablished brick-and-mortar operations in both onshore and offshore geographies wherecompanies have access to high-quality customer contact management solutions at lowercosts compared with other markets.

Sykes expanded its geographic presence and its business operations through its organicand inorganic growth strategy. In August 2015, the company acquired Qelp, allowing it tobroaden and strengthen its service portfolio around digital customer support services.

Some clients cite flexibility, collaboration, deep industry process knowledge, service qualityand consistency, and analytic capabilities as key strengths of Sykes.

CAUTIONS

Sykes has a relatively high client concentration. It depends on a limited number of clientsfor most of its revenue. Sykes's top 10 clients accounted for 46.8% of the consolidatedrevenue, and it is highly concentrated in the communications sector. Though this is a CMBPO industrywide issue, clients need to evaluate this caution prudently.

Sykes lacks scale in key markets within EMEA and Asia/Pacific. This lack of scale limits thecompany's ability to compete effectively for global and regional deals, especially in marketssuch as EMEA and Asia/Pacific.

Some clients cite IT and project management skills, some inconsistencies in operationsreporting, longer time required to work with internal legal and financial processes, anddelivery of unstructured client engagements as key cautions. In some cases, larger, morecomplex (multisystem) implementations can stretch resources.

Tech Mahindra

Tech Mahindra is ranked as a Visionary in this year's report. Tech Mahindra's CM BPO armhas about 27,500 employees, serving over 90 clients from 26 delivery locations across 15countries in more than 54 languages and dialects with revenue of approximately $400 million.Tech Mahindra BSG has a strong presence in the emerging markets, especially in thecommunications sector across the U.K., Asia/Pacific and Africa, and it is investing to grow inNorth America — new centers include Budapest, Mexico, Sao Paulo and Waterford (Ireland).Despite having a delivery center in Fargo, Tech Mahindra BSG has to develop more onshorecenters in North America to cater to a growing customer base. Key vertical/industry focusincludes communications, banking, financial services and insurance (BFSI), retail, energy,hospitality, healthcare, pharmaceuticals and technology.



The company continues to roll out its digital, nonvoice multichannel services, automation,analytics social CRM and platform strategy — with platforms such as CareXa, Socio, Tecnico,OrderVu, OrderFix and Prism, for its CM contact center BPO business. The company isactively and methodically moving clients onto its digital CareXa offering, which also hasmultichannel service. The company has extensively tapped into emerging markets and hasembarked on providing more flexible pricing models, such as outcome-based pricing and pay-as-you-use, to clients.

STRENGTHS

Tech Mahindra BSG has a solid management team with a focus on service delivery. It alsohas a strong sponsor — the Mahindra Group. The company continues to build its thoughtleadership, consulting (CM) capabilities and assets, as well as to develop centers ofexcellence in collaboration with its IT services business.

Tech Mahindra BSG has an extensive voice-based service offering for CM BPO services andcontinues to invest in digital, nonvoice multichannel, analytics and social CRM services.The company is investing in and building next-generation-platform-based solutions, such asCareXa and Socio, which are now part of the company's CM contact center BPO portfolio ofservice and solutions.

Some clients cite strong cultural fit, strong industry expertise and process knowledge,responsiveness, result orientation, strong analytics and technology capabilities, goodfunctional capabilities, fast turnaround time and good program management capabilities askey strengths.

CAUTIONS

Tech Mahindra BSG's primary focus is on Asia/Pacific, Africa, North America, the U.K. andAustralia. Besides domestic language support in Asia and Africa, the company's focuselsewhere is only on English-language-based services; it has limited scale in otherlanguages. However, the company has started to invest in new European and CentralAmerican locations, as mentioned above.

The company has a high level of client and vertical/industry concentration in thecommunications sector. The top five clients account for 60% of total revenue. Hence, losingonly one of these clients could have a financial impact on the company. To improve thisimbalance, the company has started expanding into retail and BFSI over 15 months. It hasalso ramped up the global sales team dedicated to CM contact center BPO services totarget noncommunications sector clients.

Some clients cite inconsistent service quality across centers, limited onshore presence inthe U.S., lack of performance consistency in midlevel management, and attrition andturnover of agent and middle management skills as key cautions.

Teleperformance



Teleperformance is ranked as a Leader in this year's report. Teleperformance is the largestCM contact center BPO service provider in the world, by revenue — estimated at $4 billion,and by geographical footprint. The company recently acquired the Aegis U.S. CM contactcenter BPO business. The company has more than 190,000 FTE agents who support 75languages and dialects from more than 270 centers in 62 countries. Teleperformance hasbalanced revenue contributions from its key markets — namely, Europe, the English-speakingmarkets (North America, the U.K. and Asia/Pacific), and Ibero-Latin America.Teleperformance continues to focus on the following vertical industries: financial services,communications, travel and transportation, technology, discrete manufacturing, healthcare,and retail.

The company possesses a diversified vertical/industry and client base, with nearly 750clients across several industry segments. In FY14, the company generated 24% of its revenuefrom telecommunications and the Internet, followed by technology, electronics and media at14%, and pay TV with 11%. In 2014, Teleperformance was recognized as the best employer inthe Asia/Pacific region by Aon Hewitt. Due to its size and geographical footprint,Teleperformance, as is the case with most large multinational corporations, focuses onbundled or value-added large-scale service engagements (that is, for very large globalorganizations).

The company continues to plan its growth and expansion through both organic and inorganic(M&A) strategies, as seen by its acquisition (announced in August 2014) of Aegis' U.S.business, as well as the opening of new locations in South America (Guyana and Surinam),the Middle East (Dubai) and the U.S. Teleperformance has a strong corporate socialresponsibility program that is sponsored globally but is led and delivered locally (that is,Citizen of the World and Citizen of the Planet).

STRENGTHS

Teleperformance has one of the most extensive and global presences in the CM contactcenter BPO market. The company continues to experience strong revenue growth and has astrong cash position, recording a 9.9% increase in its revenue in FY14, as compared withthe previous year. Teleperformance continues to invest in its R&D capabilities through itswholly owned subsidiary — Gnresearch.

Teleperformance has strong local leadership, with extensive local knowledge and businessacumen that is supported by an experienced global organization and leadership team. Itprovides multilingual services and has an extensive social CRM and concierge (premium)service offering.

Some clients continue to cite responsiveness, flexibility, geographical footprint, apartnership approach to issue resolution, cultural fit, project management skills,compliance (including U.K. Transfer of Undertakings [Protection of Employment] [TUPE]regulations) and security capabilities and methodologies, multilingual capabilities,analytics, and operational excellence as key strengths.

CAUTIONS



CAUTIONS

Less than 10% of the company's revenue comes from digital, multichannel, automated andanalytics services. Slow growth in France and Southern Europe coupled with a slowingeconomy in Latin America may see revenue and margin pressure for the company, althoughthe North American and Asia/Pacific growth will help limit exposure.

Due to its size, geographical footprint and go-to-market strategy, the company may not be agood fit for small or midsize businesses (SMBs) looking for commodity-based services orprograms.

As key cautions, some clients cite attrition of agents and midlevel management, ITinfrastructure, lengthy contract negotiations, recruitment of agents, and training.

TeleTech

TeleTech is ranked as a Leader in this year's report. TeleTech, based in Denver, Colorado, is aglobal provider of customer experience and growth solutions with annual revenue of over$1.2 billion. The company has over 40,000 FTE and WAH agents across 58 centers in 24countries, supporting 49 languages and dialects. The company supports global enterpriseclients in automotive, communications and media, financial services, government, healthcare,technology, transportation and retail sectors across 80 countries. TeleTech continues toinvest in and optimize consulting, voice and digital and multichannel services across thecustomer life cycle. Through its Customer Strategy Services division, TeleTech is able todeliver thought leadership, strategy and management consulting services to its existingclients and prospective CM contact center BPO buyers.

The company provides marketing services, revenue generation, and back-office and humancapital solutions, including learning services and analytics-driven customer experiencebusiness services and solutions globally. TeleTech offers an integrated platform thatcombines consulting, technology, care and growth services to streamline and personalizecustomers' interactions to create a consistent customer experience. TeleTech continues todevelop technology-based solutions, delivered through the cloud, on-premises or via hybridmodels.

STRENGTHS

TeleTech has comprehensive nonvoice multichannel, analytics and automated serviceofferings. The company also provides strong Web and BPaaS offerings for marketing,loyalty, revenue generation and digital acquisition, as well as customer service — such aseLoyalty and Revana Digital.

The company has a strong data-focused, cloud-based technology platform throughHumanify, which adopts a customer's communication preference and enables streamlinedinteractions between service and support and Revana AQ360, a search-to-sales customerjourney and growth engine. TeleTech helps organizations understand how their customerswant to interact across channels, including social and mobile platforms, in real time.



Some clients cite cross-functional and organizational processes, consulting and thoughtleadership capabilities, analytic capability, system implementation, global presence,operational management capabilities, and revenue-generation services (Revana) as keystrengths.

CAUTIONS

TeleTech has a large client concentration, with its top five and 10 clients collectivelycontributing 38% and 50% of the company's total revenue in 2014, respectively. The largestclient accounted for nearly 11% of total revenue in 2014. Clients looking to engageTeleTech need to understand and assess this business risk with regard to the company'sclient and vertical/industry concentration.

TeleTech is perceived to be a premium service provider and in some cases deemed to bemore expensive when compared with its peers. TeleTech customizes its offeringsextensively for each client, making standard offerings and pricing difficult due to the highercost to support its services. Gartner believes the company will be able to address this issuewith further deployment of BPaaS, digital, multichannel and cloud-based services.

As key cautions, some clients cite attrition (in offshore locations), pricing, internal costpressures, rigid corporate culture and consistency of CM contact center BPOcapabilities/skills in some delivery centers.

Transcom

Transcom is ranked as a Challenger in this year's report. Headquartered in Stockholm,Sweden, Transcom continues its way to become a leader in the BPO market. It providesonshore, offshore or nearshore customer care, sales, technical support and collectionservices through its network of contact centers and WAH agents. It employs 30,000 customerexperience specialists at 54 contact centers across 23 countries, delivering services in 33languages to international companies in different industries. In March 2015, private equityfund Altor bought 24.5% of the ordinary shares in Transcom from Kinnevik. In November2014, Transcom executed a redomiciliation of the parent company of the Transcom Groupfrom Luxembourg to Sweden. By this move, Transcom is no longer bound by dual legalsystems — Swedish and Luxemburgish. This will lower costs and simplify the execution ofcorporate actions. Next to the redomiciliation, Transcom made some significant changes inthe management team to increase focus and accountability in important areas.

Transcom has made efforts to focus on outsourced CM solutions. In 2014, some of theCredit Management Services country units were divested. And others were restructured inorder to be integrated with Transcom's core customer care operations. This has resulted inthe direction of all organizational resources toward strengthening its position in the corebusiness of outsourced CM solutions.

STRENGTHS



Transcom continues to strengthen its management team in order to increase focus andaccountability in key operational areas to help enhance service delivery to clients. The newappointments will be fundamental in meeting key goals of improving the company'sfinancial and operational capability, building global engagements and driving growth ofdigital, multichannel, analytics and automation services.

Transcom continues to increase its nonvoice revenue. The share of nonvoice has increasedfrom 14% in 2013 to an estimated 26% for the full year 2015. Multichannel solutions are ahighly prioritized area for Transcom and many of its clients. The company is expandingmultichannel services with major clients in several geographies and sees a significantincrease in worked nonvoice minutes.

Some clients cite strong senior management team, commitment to their staff, quality ofagents, transparent, easy to do business with, flexible, able to cope with high pace ofchange and proactive in recommending innovative solutions and services as key strengths.

CAUTIONS

Transcom has a high geographical concentration, with Northern Europe accounting for 32%of total revenue and Central and South Europe accounting for 24%. It has won newbusiness with domestic clients in Iberia and Latin America, but volumes in Latin Americaare still too low.

The company has a high level of client concentration. While a significant part of Transcom'srevenue is generated from a limited number of key clients, the company's focus onacquiring new clients is showing results. Clients looking to engage Transcom need tounderstand and assess this business risk with regard to the company's clientconcentration.

Some clients cite limited U.S. and nearshore location options, lack of proactive issuemanagement (middle management), inconsistent management expertise and skills,timeliness (management response), and IT and systems expertise as key cautions ofTranscom.

transcosmos

transcosmos is ranked as a Niche Player in this year's report. Tokyo, Japan-basedtranscosmos saw its 2014 revenue grow to $1,668 million, of which more than $650 million isestimated as CM contact center BPO revenue. The company also has a good IT servicescapability to help deliver process solutions and automation.

The company is based in Japan and has more than 35,000 CM contact center BPOemployees across 26 countries in more than 156 centers. Key markets in Asia/Pacific includeJapan, South Korea, China, the Philippines, Indonesia, Thailand and Vietnam. The companyhas developed deep vertical-industry capabilities for the telecommunications, wholesale andretail, financial services, and manufacturing (process manufacturing) sectors.

STRENGTHS



STRENGTHS

transcosmos has deep expertise in CM and digital marketing processes and functionsspecific to the Japanese, South Korean and Chinese markets.

transcosmos has deep enduring client relationships and a large client base in South Korea(including local conglomerates) and Japan, with local Japanese companies looking toexpand into the rest of Asia/Pacific.

Some clients cite project management skills, focus on customer experience and results,timeliness, continuous engagement with clients, and understanding clients' business andneeds, as key strengths.

CAUTIONS

The company's focus is primarily on Asia/Pacific with high levels of geographic andlanguage concentration in the Asia-based languages and limited English and Europeanlanguage capabilities. In order to grow its presence, transcosmos established its firstcenter in Europe in the U.K. in late 2014. Clients looking for European language capabilitiesmust assess and mitigate this limitation.

transcosmos has limited experience and knowledge when dealing with clients based inregions outside Asia/Pacific — especially European clients. Clients planning to engage thecompany should also consider business culture and communications as key areas to focuson besides operational matters.

Some clients cite agent attrition, middle management staff turnover, ability to scale, lack ofEnglish language capabilities, limited insights and analytics services, and relatively shorttenure of staff, as key cautions.

Wipro

Wipro is ranked as a Challenger in this year's report. India-headquartered Wipro providesinformation technology, consulting and business process services to its clients across theglobe. Wipro employs over 150,000 people spread across more than 175 locations worldwideand generated $7.6 billion in annual revenue in FY15. Wipro's CM contact center BPObusiness has over 20,500 FTE employees supporting over 60 clients across 50 countries in20 languages from 24 delivery locations.

Wipro's CM contact center BPO services include presales, sales, customer service andsupport, inquiry handling, marketing, and product and technical support services. Thecompany has a methodical approach to delivering premium customer experience throughprocess excellence, transformation (process or business), and automation. Apart from stand-alone offerings, Wipro provides integrated contact center services combined with large-scaleIT services. Wipro's key target vertical markets are communications, BFSI, technology, travel,retail and healthcare .

STRENGTHS



Wipro has developed six centers of excellence specifically for its CM contact center BPOpractices, and it has invested in domain consultants to help customers develop andexecute on their CM strategies.

Wipro has a proprietary framework called Next-Gen Customer Experience (NGCE), whichleverages process excellence, transformation (process or business), automation andanalytics, delivering clearly defined business benefits and ROI while enhancing customerexperience. Clients engaging with Wipro should ensure these services are provided as partof the service delivery offering.

As strengths, some clients cite strong leadership, good analytics capabilities, focus onservice delivery, scalability, ability to undertake multiple complex programs, focus oncontinuous improvement and cost containment, and perception as an ethical company.

CAUTIONS

Wipro must further innovate and provide platforms to facilitate intuitive and personalizedcommunication in real time through its CM contact center BPO delivery locations. Clientslooking for disruptive and emerging multichannel platforms, such as mobile social andcognitive technologies, need to carefully assess Wipro's capabilities, as some may still be inpilot phases.

Clients still perceived Wipro as an IT services and solution provider rather than a CMcontact center BPO service provider. As is the case with most IT service providers,investments in the business (such as processes and technology) are typically prioritized forits IT services business units rather than the CM BPO service business. Clients need tounderstand that even though Wipro is a technology heritage company, it still needs to investin technologies related to CM contact center BPO service.

As key cautions, some clients cite agent attrition, middle management staff turnover, lackof communication skills (agent level), limited onshore/offshore offerings, and challengeswith communications with internal stakeholders on issues.

Xerox

Xerox is ranked as a Leader in this year's report. Xerox employs nearly 51,000 FTE employeesin the CM contact center BPO business unit. Approximately 4,000 of these employees areWAH agents serving companies across multiple industries from over 170 centers across 25countries, with services in more than 30 languages. Xerox has more than 25 years ofcustomer care experience and processes more than 2.5 million customer care interactionsdaily. Gartner estimates Xerox's CM contact center BPO service revenue to be approximately$1.8 billion, and more than 30% of Xerox's CM contact center BPO interactions are currentlydelivered through digital, multichannel self-service and automated channels — the industryaverage is just above 20% of total revenue. In Asia/Pacific, Xerox and its associate company— Fuji Xerox — continues to grow business opportunities. Currently, Fuji Xerox is one of thelargest BPO service providers in Asia/Pacific. Xerox has approximately 400 CM contact



center BPO clients. Xerox's vertical/industry focus includes technology, communications,banking and financial services, travel, retail, education, government, pharmaceuticals, andhealthcare.

The divestiture of the ITO business signals a strong commitment to the documentoutsourcing and BPO segments within services, and it will allow Xerox to continue makinginvestments in advancing service delivery capabilities in the BPO market, which is facingsignificant disruption due to technology and service delivery automation. The company hasdeveloped an intelligent, virtual customer care agent that is capable of understanding andsolving customer queries in the same way a human agent would. With artificial intelligence(AI), the initiative also involves analyzing data and learning from its human colleagues. TheWDS Virtual Agent is based on artificial intelligence developed by Parc and the XeroxResearch Center Europe (XRCE) and is capable of learning from its human agents and self-help channels. The company has a large range of services, such as document managementand BPO, that can significantly benefit prospects that are looking for a full suite of servicesand capabilities.

STRENGTHS

Xerox has strong CM consultative selling capabilities and has built up assets andcapabilities in centers of excellence and "Care Labs" — which allow clients to experimentwith their hypotheses and issues, assess current services and develop strategic roadmapsand Mode 2 capabilities.

The company continues to invest in innovation with the development of automation(including AI) and analytics to differentiate its services while delivering high levels ofcustomer experience at optimal costs. It is also engaged in new and innovative models inthe areas of achievement-based compensation (for its staff), pricing models, dealengineering, workforce management and training management. Clients engaging withXerox must take advantage of this offering and include it in their service expectations.

As key strengths, some clients cite agility, flexibility, deep vertical industry knowledge andexperience, responsiveness, project management skills, scalable and reliable services,willingness to partner with clients, focus on continuous improvement and an engagedmanagement team.

CAUTIONS

Xerox's CM contact center BPO business is not known to most prospects; the company isstill perceived to be a document technology company.

Xerox continues to demonstrate leadership in digital, multichannel, automation andanalytics services, and it continues to expand its capabilities. However, the company needsto further develop its service offerings to include BPaaS and digital services, multilingualcapabilities, and marketing services.



As key cautions, some clients cite agent attrition, average customer experience results,limited leverage of Xerox innovation, administrative bureaucracy, management andperformance consistency across locations, staffing model and recruitment process, andagent communication skills.

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants as markets change. As aresult of these adjustments, the mix of vendors in any Magic Quadrant may change over time.A vendor's appearance in a Magic Quadrant one year and not the next does not necessarilyindicate that we have changed our opinion of that vendor. It may be a reflection of a change inthe market and, therefore, changed evaluation criteria, or of a change of focus by that vendor.

Added

Firstsource

Minacs

Wipro

Dropped

West was dropped because of the sale of CM BPO Assets to Alorica. Hence, the revenue forthe existing services in West did not meet the inclusion criteria.

Inclusion and Exclusion CriteriaThis research evaluates service providers on their CM contact center BPO capabilities,specific to the management of their own employees to deliver those services. Directmanagement of subcontractors does not apply to this research effort. Rather, this projectaims to assess a CM contact center BPO service provider's ability to recruit, train, manage,deploy and retain agents to provide CM contact center processes for enterprise orgovernment clients. CM contact center BPO initiatives require multiple skills and assets to besuccessful. CM contact center BPO service providers considered for this Magic Quadranthave a blend of the following:

CM contact center BPO business expertise (for example, business process design andservice delivery skills)

Organizational expertise (for example, change management and training)

Industry expertise (for example, in the communications, healthcare, utility and financialservices sectors)

Multiple CM vendor/product and technical expertise (such as expertise with homegrownplatforms, Amdocs, Microsoft, Oracle, Salesforce, SAP, Avaya, Nortel, Cisco and InteractiveIntelligence, as well as multiapplication integration, customer data repository strategy and



design)

CM contact center BPO program and project management expertise (for example, projectmanagement skills to take on new clients, portfolio management and governance,customer contract management)

Ability for innovation (for example, customer experience management design andmanagement)

Capabilities to deliver CM contact center BPO services through onshore, nearshore oroffshore (global delivery) service delivery models

Ability not only to provide service on the voice channel, but also to provide services acrossWeb self-service, email response, Web chat and IVR self-service

A broad group of providers offers CM contact center BPO services. Magic Quadrants do notinclude all service providers in a given sector. Many service providers focus only on parts ofthe overall solution. Companies considered for evaluation in this Magic Quadrant researchare those that not only provide the service mentioned above, but also act as strategic vendorsor partners and provide implementation and management services that encompass most orall levels of solutions and services. Providers have been evaluated in detail using acombination of quantitative and qualitative criteria. While vendors may decline to providereferences or to brief Gartner on capabilities, vendors cannot elect to be excluded from aMagic Quadrant if they otherwise meet the inclusion criteria.

Quantitative Criteria

The following quantitative criteria or thresholds have been set based on existing marketsurveys and the Gartner business process market share data:

Service providers that demonstrate CM contact center BPO service revenue derived fromclients, with:

A minimum revenue of $450 million (in U.S. dollars, for 2014) for worldwide CM contactcenter BPO services; or

A minimum of 20,000 CM contact center BPO FTE agents

Qualitative Criteria

Ability to provide references from at least four existing CM contact center BPO serviceclients from the Americas and/or three each from EMEA and/or Asia/Pacific (minimum 10references)

A global/multicountry company, with a commitment to CM contact center BPO services

Market share and client base in at least two regions (that is, North America and LatinAmerica, EMEA, or Asia/Pacific)



Capabilities to serve clients globally; must have global service delivery centers in at leasttwo regions (that is, North America and Latin America, EMEA, or Asia/Pacific)

For the purpose of this Magic Quadrant research, Gartner assessed service providers withcomprehensive CM contact center BPO service offerings (that is, customer-facing processesthat providers offer from across the four subsegments that make up CM contact center BPO).

Excluded from this research are:

Accounts receivable management (collections).

IT help desk.

HR or other enterprise services, including back-office functions.

Field sales automation — This includes management and administration of face-to-faceinteractions between sales teams and clients. The four types of field sales models are:influencer (using industry experts); opportunity-driven (used primarily for large-valueproducts); project-driven (used for selling professional services); and iterative (based onongoing relationships, such as consumer packaged goods).

Gartner reviews and adjusts the inclusion criteria for Magic Quadrants and MarketScopes asmarkets change. As a result of these adjustments, the mix of vendors in any Magic Quadrantor MarketScope may change over time. A vendor appearing in a Magic Quadrant orMarketScope one year and not the next does not necessarily indicate that we have changedour opinion of that vendor. This may be a reflection of a change in the market and, therefore,changed evaluation criteria, or a change of focus by a vendor.

Evaluation Criteria

Ability to Execute

Gartner analysts evaluate CM contact center BPO service providers on the quality andefficacy of the processes, systems, methods or procedures that enable BPO service providerperformance to be competitive, efficient and effective, and to positively impact revenue,retention and reputation. Ultimately, BPO service providers are judged on their ability andsuccess in capitalizing on their vision. The following criteria were used to evaluate serviceprovider positions.

Product/Service: Core CM contact center BPO services offered by the service provider thatcompete in or serve the worldwide market. This includes CM contact center BPO servicecapabilities, quality, feature sets, skills and so forth, whether offered natively or throughpartnerships as defined in the Market Definition/Description section and detailed in thesubcategories.



Subcategories include assessment of services in key CM contact center BPO business skills,such as selection, acquisition, retention and extension; assessment of technical knowledgeand skills (that is, service delivery); and effectiveness in developing services to meetemerging market need and usage of all the channels identified above.

Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includes anassessment of the overall organization's financial health, the financial and practical successof the business unit, and the likelihood of the individual business unit to continue investing inthese services, to continue offering the services and to advance the state of the art within theorganization's portfolio of services.

Sales Execution/Pricing: The service providers' capabilities in all CM contact center BPOpresales activities and the structures that support them. This includes deal management,pricing and negotiation, presales support, and the overall effectiveness of the sales channel.

Market Responsiveness and Track Record: Ability to respond, change direction, be flexibleand achieve competitive success as opportunities develop, competitors act, customer needsevolve and market dynamics change. This criterion also considers the CM contact centerBPO service provider's history of responsiveness and the ability to quickly scale up or downon the number of seats based on the customer's changing requirements.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed todeliver the organization's message to influence the CM contact center BPO market, promotethe brand and business, increase awareness of the services, and establish a positiveidentification with the brand and organization in the minds of buyers. This mind share can bedriven by a combination of publicity, promotional, thought leadership, word-of-mouth andsales activities.

Customer Experience: This criterion considers specific client feedback on clients' experienceworking with the CM contact center BPO provider and the provider's ability to deliver on keymetrics that drive the overall client experience when working with the CM contact center BPOprovider.

Operations: The ability of the organization to meet its goals and commitments. Factorsinclude the quality of the organizational structure, including skills, experiences, programs,systems and other vehicles that enable the organization to operate effectively and efficientlyon an ongoing basis. Subcategories include applied use of proprietary methodologies andCM contact center BPO global delivery model footprint and capabilities.

Changes to the 2015/2016 Ability to Execute evaluation criteria are as follows:

We split the Product/Service category based on voice and nonvoice services, with aweighting of 55-to-45 voice to nonvoice services.

Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting



Product/Service Medium

Overall Viability (Business Unit, Financial, Strategy, Organization) Low

Sales Execution/Pricing Medium

Market Responsiveness and Track Record High

Marketing Execution Medium

Customer Experience High

Operations Medium


Completeness of Vision

Gartner analysts evaluate CM contact center BPO service providers on their ability toconvincingly articulate logical statements about current and future market direction,innovation, customer needs and competitive forces and how well they map to the Gartnerposition. Ultimately, service providers are rated on their understanding of how market forcescan be exploited to create opportunity for the provider.

Market Understanding: The ability of the provider to understand buyers' needs and totranslate these needs into products and services. It includes service providers that show thehighest degree of vision, listen and understand buyers' wants and needs specific to CMcontact center BPO, and can shape or enhance those wants with their added vision.Subcategories include the service provider's knowledge and articulation of key marketdirection and trends, and the analysis of the service provider's executive leadership (includingcaliber, thought leadership, continuity, operational capabilities and so forth).

Marketing Strategy: A clear CM contact center BPO marketing strategy with a differentiatedset of messages consistently communicated throughout the organization and externalizedthrough the website, advertising, customer programs and positioning statements.

Sales Strategy: The strategy for selling CM contact center BPO services that uses theappropriate network of direct and indirect sales, marketing, and service and communicationsaffiliates that extend the scope and depth of market reach, skills, expertise, technologies,services and the customer base.



Offering (Product) Strategy: A service provider's approach to CM contact center BPO servicedevelopment and delivery that emphasizes differentiation, functionality, methodology andfeature set as they map to current and future requirements. Subcategories include serviceprovider strategies for partnerships and alliances (where applicable), vision for creating newand/or additional CM contact center BPO offerings and business, and vision for exploitationof channels other than voice.

Business Model: The soundness and logic of the service provider's underlying CM contactcenter BPO business proposition.

Vertical/Industry Strategy: The service provider's strategy to direct CM contact center BPOresources, skills and offerings to meet the specific needs of individual market segments,including vertical markets and industries.

Innovation: Direct, related, complementary and synergistic layouts of CM contact center BPOresources, expertise or capital for investment, consolidation, defensive or pre-emptivepurposes. This also includes the vendor's approach to customer experience design anddevelopment, as well as its sustainable investment in proactive tools, methods, platformsand/or locations for CM contact center BPO service delivery.

Geographic Strategy: The service provider's strategy to direct CM contact center BPOresources, skills and offerings to meet the specific needs of geographies in support of the"home" or native geography, directly or through partners, channels and subsidiaries, asappropriate for that geography and market.

Changes to the 2015/2016 Completeness of Vision evaluation criteria are as follows:

We increased the weighting for the Business Model category from Low to Medium.

We included a further refinement to the Geographical Strategy category based on regions(that is, the Americas, EMEA and Asia/Pacific, with a 34-33-33 ratio, respectively). In thisinstance, the revenue by region or Gartner estimates will be split by the weighting. Forexample, a company may have the following score (based on revenue) for the region:

For example, (34/100) x 9 (for North America) + (33/100) x 5 (for EMEA) + (33/100) x 7 (forAsia/Pacific) = 7.02 (the total score).

We included a further refinement to the Vertical/Industry Strategy category based onspread of offerings across various vertical industries — 90% of revenue derived from lessthan three vertical industries, 90% of revenue derived from four to six vertical industries,and 90% of revenue derived from more than six vertical industries, with a 10-30-60 ratio,respectively, for the total score achieved. For example, if a provider has 90% of its revenuederived from four industry sectors, then the provider will receive a weighted score of 30:

That is, 30/100 (weighting) x 10 (score) = 3.0, while a provider with seven industry sectors willreceive a weighted score of 60 — that is, 60/100 (weighting) x 10 (score) = 6.0 (total score forthe Vertical/Industry Strategy category).



Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Medium

Sales Strategy Medium

Offering (Product) Strategy High

Business Model Low

Vertical/Industry Strategy Medium

Innovation High

Geographic Strategy Medium


Quadrant Descriptions

Leaders

Leaders demonstrate market-defining vision and the ability to execute against that visionthrough CM contact center BPO services, a superior market share (among the top 10providers in regions where they compete), and solid references for CM contact center BPOservices worldwide, including a cross section of vertical industries. Leaders also havesuperior investments in innovative CM contact center BPO service offerings, business/pricingmodels and service delivery models. They have a superior understanding of client needs andof current market conditions, and they are actively building competencies to sustain theirleadership position in the CM contact center BPO market across multiple regions. The CMcontact center BPO service providers in this Leaders quadrant generally also have strongglobal and regional service delivery operations and deep technology to leverage, and theydeliver above-average customer experience.

Challengers



Challengers display sound vision and a strong ability to execute against the vision, but theyhave a less-defined view of market directions. The Challengers in this quadrant have arelatively good level of market understanding, a growing volume of sales and a sizable marketshare in key regions/markets for CM contact center BPO services, as well as a goodunderstanding of their clients' evolving needs. They also have a strong operational executionbut might lack geographical presence, depth in vertical industry, and technology capabilitiesand assets.

Visionaries

Visionaries have strong vision and the ability to execute well against this vision. Visionariesare ahead of potential competitors in delivering innovative services, business/pricing modelsand/or delivery models. They anticipate emerging or changing market and customer needs,and they move into new opportunities quickly. They have a strong potential to influence thedirection of the worldwide CM contact center BPO market, but they may struggle to meet theneeds of all organizations because of some limitations — geographical coverage, technology,marketing and brand awareness, or vertical industry knowledge. Visionaries must also focuson sales and marketing execution and customer experience to help improve their overallposition.

Niche Players

Niche Players focus on a particular segment of the market — as defined by characteristicssuch as size, vertical industry market, geographical region and project complexity — or theyprovide only a select number of services among overall CM contact center BPO services.They may offer components of the complete service portfolio but demonstrate limitations inone or more important service areas. Among the worldwide CM contact center BPO serviceproviders in this quadrant, strengths in market responsiveness and track record, innovation,marketing and brand awareness are bigger considerations. The relative number of installedbase contracts is also a factor.

ContextThe market for CM contact center BPO expanded in the past 12 months to become a $38billion business in 2015. While some aspects of these BPO services are mature, it isimportant for buyers to evaluate service providers that closely match their requirements interms of geographical positioning, expertise in their particular industry vertical, and highfocus on fast-growing nonvoice services, such as Web chat and knowledge base self-service.The target audiences of this Magic Quadrant are buyers of CM contact center BPO services,those looking to expand or rightsize their providers and/or services, potential buyers of theseservices, and general market watchers, such as the investment community.

This Magic Quadrant evaluates leading players in the worldwide CM contact center BPOservice provider landscape. It evaluates service providers on their CM contact center BPOcapabilities in the Americas, EMEA and Asia/Pacific. The scope of services ranges from the



management of service provider employees to the delivery of CM contact center BPOservices to the management of customer experience. However, the direct management ofsubcontractors does not apply in this research. Rather, this project aims to assess a CMcontact center BPO service provider's ability to recruit, train, manage, deploy and retainagents to support and deliver CM contact center processes and services for enterprise orgovernment clients worldwide.

Market OverviewThe worldwide CM contact center BPO market is forecast to grow steadily at a 5.6%compound annual growth rate (CAGR) from 2015 through 2020. By the end of 2020, Gartnerestimates the CM contact center BPO industry will achieve a market size of $46.7 billion.Therefore, Gartner believes the opportunities for growth in this market are robust for bothclients and service providers, especially those that are willing to aggressively makeinvestments in marketing, sales and customer service that leverage digital, multichannel,automation and analytics services beside the traditional agent-based voice services.

Today the industry is at the forefront of business, managing important "moments of truth" forglobal brands and governments across multiple channels of interactions from the traditionalcalls to Web chat or mobile services to automated virtual agents — with some engaged incognitive self-learning. The industry's mantra today is "customer experience," "customerjourney" and "customer engagement life cycle" to name a few, far sweeter that the decades-old chants of "cost savings" and "cost optimization." Though the mantra has changed, someold habits die hard, such as the continued reliance on average handle time (AHT), theindustry's most loved and hated measurement metric (please see "CX: How to Optimize aBPO Provider's Ability to Improve Customer Experience" ).

Moving forward, Gartner expects buyers to grow in sophistication with regard to managingcomplexity (such as multichannel or vertical/industry specific services) and outcomes in agiven business relationship — through the extensive use of governance and contractmechanisms. Buyers today are looking for the "value" equation rather than just "cost savings"outcomes. Buyers have "slow economic growth" fatigue and are looking for nonlinear growthopportunities through innovative business models for their products and services. As the"custodians" of customer experience and "curators" of moments of truth for their endcustomer, they look to us for guidance and insights on where is the "next big thing" that willhelp them differentiate their products or services, and deliver nonlinear growth opportunities.Discussions have truly shifted from just cost containment and labor arbitrage to the deliveryof enhanced customer experience, automation, value-added services such as multichanneland analytics services, scalability, quality of service and more innovative ways of addressingthe increasing levels of complexity in their business and customers.



Digital services today means different things depending on who is asked, which can beconfusing. Gartner has, therefore, created a definition aimed at narrowing down what it reallyis — the purist view. Gartner defines digital business as the creation of new business designsby blurring the physical and digital worlds. The promise of digital business transformation isto usher in a convergence of people, business and things to create new engagement andrevenue opportunities. This confluence enables enterprises to take advantage of howdevices, information, advanced analytics and technologies can be utilized to dramaticallyreshape how business functions and processes are executed. Of particular importance todigital business operations is the impact of the Internet of Things (IoT; devices and sensorsthat are used to collect data related to business operations), a subset of digital business.With the use of analytics, the data from the IoT is converted into information and insights thatcan be used to monitor, react and optimize the business operations in a dynamic manner,such as the BPaaS-based premium product support (PPS) or premium tech support (PTS).Digital business is unique in that there must be business operational changes enabled bythings and technologies, and these changes must be internal and external to the enterprise.Digital marketing is similar to digital business in that it changes business processes andusually connects external participants to internal processes. Most CM BPO services arefocused on the implementation of digital technologies to deliver a digital service experience,while a small handful of providers have really embraced digital business in its pure form.

For more information, see "Market Trends: Customer Management BPO Matures With BPaaSand Multichannel, Analytics, Marketing and Mobility Services."

Evaluation Criteria Definitions

Ability to Execute

Product/Service: Core goods and services offered by the vendor for the defined market. Thisincludes current product/service capabilities, quality, feature sets, skills and so on, whetheroffered natively or through OEM agreements/partnerships as defined in the market definitionand detailed in the subcriteria.

Overall Viability: Viability includes an assessment of the overall organization's financialhealth, the financial and practical success of the business unit, and the likelihood that theindividual business unit will continue investing in the product, will continue offering theproduct and will advance the state of the art within the organization's portfolio of products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structurethat supports them. This includes deal management, pricing and negotiation, presalessupport, and the overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to respond, change direction, be flexible and achievecompetitive success as opportunities develop, competitors act, customer needs evolve andmarket dynamics change. This criterion also considers the vendor's history of



responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed todeliver the organization's message to influence the market, promote the brand and business,increase awareness of the products, and establish a positive identification with theproduct/brand and organization in the minds of buyers. This "mind share" can be driven by acombination of publicity, promotional initiatives, thought leadership, word of mouth and salesactivities.

Customer Experience: Relationships, products and services/programs that enable clients tobe successful with the products evaluated. Specifically, this includes the ways customersreceive technical support or account support. This can also include ancillary tools, customersupport programs (and the quality thereof), availability of user groups, service-levelagreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factorsinclude the quality of the organizational structure, including skills, experiences, programs,systems and other vehicles that enable the organization to operate effectively and efficientlyon an ongoing basis.

Completeness of Vision

Market Understanding: Ability of the vendor to understand buyers' wants and needs and totranslate those into products and services. Vendors that show the highest degree of visionlisten to and understand buyers' wants and needs, and can shape or enhance those with theiradded vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicatedthroughout the organization and externalized through the website, advertising, customerprograms and positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of directand indirect sales, marketing, service, and communication affiliates that extend the scopeand depth of market reach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: The vendor's approach to product development and delivery thatemphasizes differentiation, functionality, methodology and feature sets as they map tocurrent and future requirements.

Business Model: The soundness and logic of the vendor's underlying business proposition.

Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings tomeet the specific needs of individual market segments, including vertical markets.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise orcapital for investment, consolidation, defensive or pre-emptive purposes.



Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meetthe specific needs of geographies outside the "home" or native geography, either directly orthrough partners, channels and subsidiaries as appropriate for that geography and market.

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