2017

This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside the client

organization without prior written approval from Zinnov.

Zinnov Zones for Robotic Automation Services- 2017

2

Agenda

1 About Zinnov

2 Robotic Automation (RA) Landscape

3Enterprise Engagements with RA

Services Providers

4 Zinnov Zones for RA Services

3

About Zinnov: A leading Digital Transformation & Globalization focused management consulting company

Zinnov

Enterprise Digital Transformation

Global Engineering Excellence

GEIP – Global Engineering Insights

Platform

Innovation

Enablement

Zinnov Zones

Ratings

Telecom & Networking

Consumer Electronics &

SemiconductorBFSI Retail

14 Years 200 Customers 160 Consultants 6 Offices

Offerings

Government and Industry bodies• Centre for Scientific and

Industrial Research• National Institute of

Smart Government• Ministry of Small and

Medium Enterprise• Department of Science and

Technology• NASSCOM

Tech Platforms & Internet

SolutionsIndustrial

Service Providers| Vendors

4

Zinnov’s framework based approach empowers large enterprises in making strategic decisions towards Robotic Automation (RA) investments

1. Robotics Automation Opportunity Prioritization Basis Insights from Fortune 500 Enterprises

2. Zinnov Framework for Automation Maturity-assessment of Enterprises (Z-FAME)

3. Assessment of Robotics Automation Service Providers 4. Assessment of Robotics Automation Platform Providers

Zinnov tracks the digital deals including Robotics

automation of Fortune 500 enterprises, prioritizing use

cases by verticals and in terms of intensity of

implementation

Zinnov publishes its annualRobotics Automation ZinnovZones rating of leading globalservice providers in terms oftheir RA prowess andscalability

Zinnov offers Z-FAME, a four stagedframework enabling enterprises to -1.Identify RA use-cases by verticals2.RA assets (tools used, type of

bots, etc.)3.Service Provider Competencies

(service provider relationships,consulting/ advisoryrequirements)

4.Internal Capability & Governance(COE)

Zinnov has alsoevaluated technologyplatforms, prowess,and features of leadingRA tool vendors likeAutomation Anywhere,Blueprism, etc

Zinnov Proprietary Confidential

5

Agenda

1 About Zinnov

2Robotic Automation (RA)

Landscape

3Enterprise Engagements with RA

Services Providers

4 Zinnov Zones for RA Services

6

Robotic Automation (Cognitive)

Robotic Automation (Rule Based)

Traditional Automation(Script based)

Robotic Automation (RA) involves use of software bots for automation of Business & IT processes

Source: Zinnov Research and Analysis, Deloitte

Evolution of Robotic Automation

Platform specific/ runs on data layer

Manual exception handling

Coding skills required

Platform agnostic and runs on UI layer

Manual exception handling

Coding skills typically not required

Platform agnostic and runs on UI layers

Learns to handle exceptions over time; intelligent decision making

enabled by ML algorithm

Coding skills typically not required

Quality & Compliance ScalabilityLower Cost of

OperationsEfficiency Gains

1 2 3 4

Deployment of robots reducesthe total cost of operations

Robots typically work 2x-3xfaster than humans; robots alsowork round the clock

Robots work at a significantlyhigher accuracy levels comparedto humans (~100%) and ensurecompliance

Scalable deployments acrossfunctions, business units andgeographies

Drivers for Growth in Robotic Automation Adoption

Redeployment of people from mundane processes

5

Implementation of RA leads toup-levelling of workforce todecision-making roles

Structured

Semi-structured

Unstructured

Data Type

Structured

Semi-structured

Unstructured

Data Type

Structured

Semi-structured

Unstructured

Data Type

7

Enterprises currently spend over $1.5 Bn in RA; both business & IT processes present significant investment potential

Source: NASSCOM, Gartner, Forrester, Zinnov Analysis

USD1,305Bn ~USD 41Bn

Total IT-BPM Services Spend

RA Addressable Opportunity

USD 1.5-1.8Bn USD 6.5Bn

Current RA Spend includes POC, design, development, integration, maintenance and support of RA

implementation as well as resources, infrastructure & tools leveraged for

research & training purposes

Estimated 2020 RA Spend at 60% CAGR

Total Addressable and Realized Market for Robotic Automation (FY2017)

Segmentation of Addressable Robotic Automation Market

>USD 19Bn

Business Processes

>USD 11 Bn >USD 11 Bn

Infrastructure Mgmt Processes ADM/SI Processes

By Type of Enterprise Process

8

Insurance

BFS, Insurance, Telecom and Retail verticals top the chart on adoption of Robotic Automation

Notes: *Others include Healthcare, Media & Entertainment, Public Sector, Professional Services, etc.; RA Addressable Opportunity based on vertical market size, penetration of BPO-IT services in the vertical, conduciveness of processes to robotic automationSource: Zinnov Analysis, Company websites, case studies, news articles, press releasesFNOL- First Notice of Loss, EMR- Electronic Medical Records

Banking & Finance

Retail Manufacturing Others*

Segmentation of Robotic Automation Market Based on Industry Verticals With Use Cases and Case Studies

Telecom

Illustrative Use Cases Illustrative Use Cases Illustrative Use Cases Illustrative Use Cases Illustrative Use Cases Illustrative Use Cases

E-form extraction & making system entries

Tax reporting

Compliance and credit checks

FNOL submission handling

Customer onboarding Password reset

Loyalty program management

Payments processing

Order management Incident management

Payroll administration Vendor management

Customer Onboarding

Managing applications for loan applications and

automation of account opening

Actuarial Operations

Process automation in the actuarial modelling

operations

Customer Management

Front and back office automation for better

customer experience and reduced operational costs

Invoice Handling

Workflows related to invoice handling including

creating entries in the ERP system

Procurement & SCM

Automation of processes in General Motors Global

Procurement & SCM process using Xerox

Automated Intelligence

EMR Integration

Integration of data from various applications into

one common EMR application

9

Enterprises across verticals have a potential to adopt RA across a spectrum of IT & Business processes

Zinnov Analysis

Workload Category

Trade Processing

Reconciliation

Internal Accounting

KYC/AML

Data Management

Collections & Recoveries

Corporate Reporting

Lending Operations

Workload Category

Finance & Accounting

IT Support

Claims Processing

Corporate Reporting

Transaction Processing

Product Management

Underwriting System

Customer Engagement

Workload Category

Finance & Accounting

Corporate Reporting

Procurement

IT Support

Sales Management

Corporate Planning

Logistics & Distribution

Inventory Management

Workload Category

Server Management

Operations Support

Network Management

Database Management

Data Centre Management

End User Services

Security Management

Virtualization

Middleware

Cloud Support

Workload Category

Post Implementation Support

Application Testing

Deployment/ Release Management

Application Integration

Application Migration

Data Migration

Performance Testing

Banking & Capital Markets

Insurance Retail

Workload Category

Order Management

Billing

Assurance

Customer onboarding

Order fallouts

Data consolation and reporting

Complaints resolution

Password reset

Telecom

Priority Use-cases

Decreasing focus of enterprises on use cases

10

RA use case priorities are based on the value they generate and relative ease of their deployment

Source: Primary Interactions with Industry Experts, Zinnov Analysis

Value Generated (1-5)[Cost Savings | Efficiency | Quality & Compliance]

Ease

of

De

plo

yme

nt

(1-5

)[S

cala

bili

ty|

Ease

of

Wo

rkfo

rce

Red

eplo

ymen

t]

Assessment of Top RA Use-cases: Benefits to Enterprise & Ease of Deployment

Trade Processing (Banking & Capital Markets)

Reconciliation(Banking & Capital Markets)

Internal Accounting(Banking & Capital Markets)

Finance & Accounting (Insurance, Retail)

IT Support(Insurance)

Claims Processing(Insurance)

Order Management (Telecom)

Billing(Telecom)

Assurance(Telecom)

Corporate Reporting(Retail)

Procurement(Retail)

Server Management

Operations Support

Network Management

Post Implementation Support

Application Testing

Deployment/ Release Management

2

2.5

3

3.5

4

4.5

2 2.5 3 3.5 4 4.5 5

BPO IMS ADM

FOR ILLUSTRATIVE

PURPOSE ONLY

11

New age automation platforms are enabling rapid adoption of RA technology within enterprises

Other RATool Vendors

Source: Company websites, Zinnov Analysis

Offerings

Global Platform Talent Base

Focus Verticals

Cognitive Capability

CompanyInformation

Illustrative Clients

800-900

Banking, Insurance, Energy, IT, Healthcare,

Manufacturing

Medium

Founded: 2003HQ: San Jose, USA

350-450

Banking, Insurance, BPO, Telecom, IT, Retail

Low

Founded: 2012HQ: Bucharest, Romania

Blue Prism Virtual Workforce Platform

1100-1300

BPO, Telecom, Utilities, Energy, Healthcare, Banking, Insurance

Low

Founded: 2001HQ: London, UK

200-300

Banking, Insurance, Healthcare,

Manufacturing, Media

High

Founded: 2010HQ: New York, USA

WorkFusion Smart Process Automation Platform

WorkFusionRPA Express

WorkFusionChatbots

3300-3800

Banking, Insurance, Retail, Healthcare,

Utilities

High

Founded: 1998HQ: New York, USA

12

Further, the advent of intelligent automation along with business model transformations is driving the growth momentum

5. Demand concentrationNorth America accounts for more than half of the RA market and Europe for another one-third. Also, large

enterprises constitute more than 70 % of the market

3. Free tools?

RA market may follow the “Free Basic” Route, with the minimum enabling tool being available for free

e.g. WorkFusion made their basis RA offering free for enterprises

Technology vendors such as IPsoft have white-labelled their products (IPcenter) allowing SPs like IBM, Cisco, etc.

to create their respective automation offerings

6. Whitelabeling of products

1. Intelligent automationIntelligent Robots is the next frontier of RA. Companies already deploying robots with cognitive and AI abilities (ML, NLP, NLG) for complex workloadse.g. UBS using AI to identify behavioural information from unstructured data sets to show relevant wealth management products to customers

Enabled by APIs, robots are expected to come inbuilt to automate relevant most common deterministic workloade.g. Pega acquired OpenSpan - Combination brings robotics and analytics capabilities to their core - case management

2. Robots pre-built in enterprise software

4. Centralized control and monitoring

Bot Farms being created which help scale up or scale down bots as per demand

e.g. BotsInsight from Automation Anywhere for real time analytics; WorkFusion offers controls to make

changes and deployment

Key Trends in RA Market

13

Agenda

1 About Zinnov

2 Robotic Automation (RA) Landscape

3Enterprise Engagements with RA

Services Providers

4 Zinnov Zones for RA Services

14

Enterprises spent over $160 Mn in FY 2017 with external service providers around their RA deployments

Source: Zinnov Research and Analysis

End to end streamlining of RA strategy• Defining RA governance and operating model• Complete outsourcing vs CoE setup• Process discovery and re-engineering• Tool vendor selection

Design and Consulting

Customization, Development, System Integration and Deployment• Defining the right architecture frameworks • Scripting of automation processes• Testing & deployment of software robots

System Integration and development

Managed Services, Support and Maintenance• Ensuring working of software• Updating software, if required• Create any new automations/ scale previous

automations• Maintain database and provide insights

Managed servicesEnterprise

Spend on RA(FY2017 E)

RA Services Sourced by Enterprises

(FY2017 E)

USD 1.5-1.8Bn USD 160-180Mn

$ 20-25 Mn

$110-115 Mn

$35-40 Mn

15

RA services investments by enterprises are largely limited to the top 20 RA service providers

Source: Zinnov Analysis

% S

har

e o

f O

uts

ou

rce

d m

arke

t

Number of SPs in decreasing order of RA revenues

10 3020 40 100

Top 10 –65%

Next 10–20%

Rest– 15%

50 60 70 80 900%

10%

20%

Market Share of SPs in Outsourced Robotic Automation

16

Large deals on RA engagements between customers & services providers are beginning to happen

Source: Zinnov Analysis

>55%

>35%

>10%

<USD 500K USD 501K-2Mn USD 2Mn+

• Large tier companies are focusing on expansion of RA practice by leveraging their huge customer portfolio, in addition to pure play automationdeals.

• Small and mid-tier service providers are giving more emphasis to end-to-end execution and implementation of RA engagements across allservice lines.

Segmentation of RA deals by category of service provider

84%

16%

USD 501K - USD 2 Mn

84%

16%

USD 2Mn+

Legend:

Large tier Service Providers

Small & mid tier Service Providers

81%

19%

<USD 500K

By Volume - Overall

% Split of Customer Deals by Average RA Deal Size (Overall)

82%

18%

Large tier SPs

Small & Mid tier SPs

17

BFSI, insurance, telecom and retail customers show more affinity towards RA service providers

Source: Zinnov Analysis

38%

15%

17%

8%

7%

2%

9%

% Split of RA revenue

30%

21%11%

6%

6%

5%

21%

% split of RA customers

Banking and Financial Services

Insurance Telecom Retail ManufacturingMedia and Entertainment

Others

Service Provider RA Business – Segmentation by Verticals

Average Revenue Contribution by RA Customers

Industry VerticalAverage Revenue per

Customer ($ Mn)

Telecom 1.1

BFS 0.9

Retail 0.8

Manufacturing 0.8

Insurance 0.5

Media & Entertainment 0.3

Others 0.3

18

Outcome based engagement models are gaining tremendous traction as enterprises look to maximise their RA investments with service providers

Source: Zinnov Analysis

55% of robotic automation deals were outcome based as compared to 1% of overall digital

Types of Engagement Models

Drivers for Adoption of Outcome Based Models in RA

FTE based pricing less relevant with RA

Safeguarding against technology upgrades

Ease of defining outcomes for RA relevant processes

Gain Share Model- Gains above the baseline level would be shared between the client and theservice provider for a period of time.

Risk Reward Model- Joint innovation for solutions between client and vendor attenuates the riskand the reward is shared according to pre-defined terms.

Transaction Based Model- Vendor fee is defined based on the number of transactions throughthe process.

Outcome Based Models

Traditional Models- include FTE based pricing, fixed price models and T&M based pricing. Otherinnovative input based models including core/flex models are also used for RA engagements.

Traditional Models

Overall Digital Robotic Automation

99%

45%

1%

55%

Percentage Split of Customer Deals based on Type of Engagement Model

Traditional Models Outcome based models

19

Drivers for these platforms

• Bridging gaps in commercially available proprietary platforms

Vertical specific Ease of configuration Focus on front office use cases

• Increasing wallet share with license revenue

3. Partnerships with Start-ups

Service Providers are starting to make investments towards increasing their RA capabilities

Source: Zinnov Research and Analysis

Partnerships Intellectual Properties (IPs)Digital Labs & Centers of

Excellence

SPs are partnering with RA tools andtechnology vendors as well as startups

SPs are investing in building in-houseautomation platforms and cognitive solutionsas well

SPs also building CoEs for delivery excellenceand Digital Labs for development of new RAtechnologies

1. Tool Vendors

2. Partners for Cognitive Technologies

87%SPs partnering with one of the following tool vendors to leverage their RA platforms.

67%SPs preferring IBM Watson for cognitive automation

SPs partnering with startups for niche technologies like OCR, chatbots, handwriting recognition etc.

Multiple SPs have built / are building their own automation platforms.

Illustrative list

Wipro leveraging Avaamo for its business chatbots

SPs are focusing on building three types of CoEs

Design & Conceptualisation

Certification & Training

Support & Sustenance

SPs are building R&D Labs focused on emerging technologies like AI, ML, IoT, etc.

Artificial Intelligence (AI) focused R&D lab in Dublin, Ireland

9000 Approximate global strength of employees in RA CoEs

Infosys Automation Platform

Decreasing popularity amongst SPs

1.RA delivery- with governance, assessment and implementation teams

2.Collaboration with vendors- Dedicated centres for collaboration with vendors such as Openspan, IPSoft, etc.

3.RA CoE as a service offering- setting up RA CoE for customers

20

Building strong RA talent base is a key focus area for service providers

Knowledge of vertical business processes

Enterprise architecture frameworks- Zachman,

TOGAF, etc.

Automation tools (Blue Prism, etc.) and scripting

languages75%

11%

14%

Ability to identify processes to be

automated; six sigma certifications

Experience in programming (VB, C#, .Net, C++, etc.)

Programming, basic Java or .Net)

OCR and DMS tools knowledge (Kofax, EMC,

Documentum)

Experience with information solutions and

products

Sources: Zinnov AnalysisNotes: ML- Machine Learning, NLP- Natural Language Processing, GETs- Graduate Engineer Trainees, SPs- Service Providers

Creation of process design documents, technical

design documents

• SPs are building talent in-house, by identifying core capability teams and/ or hiring GETs

• SPs are training them in scripting and in ML, NLP, etc. through boot camps and induction programs, generally lasting 3-6 months

• SPs also partner with tool vendors such as Blue Prism, Thoughtonomy, etc. for their training/ accreditation programs with certifications for RA talent. Eg- Blue Prism Accreditation

Initiatives for Robotic Automation Talent Building

Segmentation of Existing RA Talent

Key SkillsMarket Talent

AvailabilityService Provider Focus on Skill Development

Types of Roles

Domain Experts/ Process Analysts

Solution Architects

Developers/ Testers

21

Agenda

1 About Zinnov

2 Robotic Automation (RA) Landscape

3Enterprise Engagements with RA

Services Providers

4 Zinnov Zones for RA Services

22

Future Outlook

Scalability of RA Business

Positioning reflects the scores in Prowess and Scalability

Scale of Business

RA Clientele

RA Capabilities

Innovation Ecosystem

Value Added BusinessModels

RA Prowess

RA Talent

Zinnov Zones for RA Services 2017: Framework

RA Prowess RA Scalability2Zinnov evaluated participating service providers on two key areas basis which they

were plotted on a 2-dimensional graph

The cumulative score of enterprises based on RA Prowess (x value) and Scalability in RA business (y value) was used to classify service providers in Zinnov Zones framework

1

23

RA Prowess Parameters

RA Capabilities

Innovation Ecosystem

Value Added

Business Models

Degree of utilization of partnerships with start-ups, technology platforms, academic universities and research institutes | Strength of digital innovation including set up of RA specific digital labs and Centres of Excellence

Ability to deliver across business models: T&M, Fixed Price and Outcome based models | Innovation in Engagement Models

Leveraging RA IPs, tools, frameworks across various verticals| Effectiveness and maturity of RA IPs in driving value to customers | Capacity of delivering RA services across service lines | Abundance and mix of RA talent | Average experience of talent

Value Addition to business by cost and time savings | Improvements in accuracy of processes

Cumulative Score on the RA Prowess parameters defines the horizontal position of Service Providers in Zinnov Zones framework

Prowess is estimated considering six key parameters:

Future Outlook Focus on new logo acquisition and strategic partnerships | Measures to expand in new geography | Innovation in new talent hiring/ development practices | Future R&D focus

24

Scalability Parameters

Scalability has been broken down into three key parameters-

Scale of RA Business

RA Clientele

Total Revenue across RA business across the verticals | Breadth of processes automated and software robots deployed

Width of RA client portfolio | Spread of marquee clients and large value accounts within the RA clientele

Cumulative Score on the Scalability parameters defines the vertical position of Service Providers in Zinnov Zonesframework

RA Talent RA talent abundance

25

EPAM

EXL

HCL

Hexaware

L&T Infotech

Mphasis

Syntel

TCS

Tech Mahindra

VirtusaPolaris

Wipro

WNS

Zensar

Genpact

Intelenet

Xoriant

Atos

Tieto

IBMAccenture

Capgemini

Source: Data shared by participant companies, Zinnov Research

Zinnov Zones for RA Services

Nurture Zone Breakout Zone Execution Zone Leadership Zone

Scal

abili

ty (

Clie

nts

, Tal

ent,

Fin

anci

als)

Overall Ratings

High

Low HighRA Prowess (Offerings, Innovation Ecosystem, Value Added, Business Models, Future Outlook)

Full Participation by Service Providers

Partial/No Participation by Service Providers

26Source: Data shared by participant companies, Zinnov Research

Zinnov Zones for RA Services

Nurture Zone Breakout Zone Execution Zone Leadership Zone

Scal

abili

ty (

Clie

nts

, Tal

ent,

Fin

anci

als)

BFS Ratings

High

Low HighRA Prowess (Offerings, Composition of Clients, Talent)

EPAM

EXL

HCL

Intelenet

L&T Infotech

Mphasis

Syntel

TCS

Tech Mahindra

VirtusaPolaris

Wipro

ZensarXoriant

Atos

Tieto

Genpact Accenture

IBM

Capgemini

Full Participation by Service Providers

Partial/No Participation by Service Providers

27Source: Data shared by participant companies, Zinnov Research

Zinnov Zones for RA Services

Nurture Zone Breakout Zone Execution Zone Leadership Zone

Scal

abili

ty (

Clie

nts

, Tal

ent,

Fin

anci

als)

Insurance Ratings

High

Low High

EXL

HCL

Intelenet

L&T InfotechMphasis

SyntelTCS

Tech Mahindra

VirtusaPolaris

Wipro

WNS

Zensar

Atos

Genpact

AccentureIBM

Capgemini

RA Prowess (Offerings, Composition of Clients, Talent)

Full Participation by Service Providers

Partial/No Participation by Service Providers

28Source: Data shared by participant companies, Zinnov Research

Zinnov Zones for RA Services

Nurture Zone Breakout Zone Execution Zone Leadership Zone

Scal

abili

ty (

Clie

nts

, Tal

ent,

Fin

anci

als)

Retail Ratings

High

Low HighRA Prowess (Offerings, Composition of Clients, Talent)

HCL

Intelenet

L&T Infotech

TCS

Tech Mahindra

VirtusaPolaris

Wipro

Zensar

Accenture

IBM

Capgemini

Genpact

Atos

Full Participation by Service Providers

Partial/No Participation by Service Providers

29Source: Data shared by participant companies, Zinnov Research

Zinnov Zones for RA Services

Nurture Zone Breakout Zone Execution Zone Leadership Zone

Scal

abili

ty (

Clie

nts

, Tal

ent,

Fin

anci

als)

Telecom Ratings

High

Low High

Full Participation by Service Providers

Partial/No Participation by Service Providers

RA Prowess (Offerings, Composition of Clients, Talent)

HCL

IntelenetL&T Infotech

TCS

Tech Mahindra

VirtusaPolaris

Wipro

Atos

Genpact

Accenture

IBM

Capgemini

30

Disclaimer

Zinnov Proprietary Confidential

In the context of Zinnov Zones for RA, we reached out to a limited set of service providers that could be potential leaders inthis space. Our set of inclusion criteria enables us to shortlist, effectively based on which service providers are invited toparticipate. While we normally see significant interest in participation, sometimes a service provider may request to beexcluded from the Zinnov Zones activity if the timing of the research or circumstances within the service providerorganization makes participation difficult. If a service provider declines to participate at the beginning of a Zinnov Zonesprocess, it is important to know the following policies:

Some non-participating service providers are still included in our evaluationo As we invite only leading service providers and emerging players to participate in Zinnov Zones, if a service

provider decides not to participate, we have still included them in the final report if we think it is necessaryo Our reasoning is that Zinnov Zones without a leading service provider would project a partial picture of the market

and make it less pertinent for our clients

The Zinnov Zones report clearly differentiates service providers that did not undergo the same rigorous evaluation as its peerso While our analysts have evaluated the service providers that declined to participate, the service provider’s place in

the ratings is denoted by a differentiating symbol indicating non-participation in the research processo Their assessment is based on different inputs than those used for evaluating its peers

Bangalore

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Phone: +91-80-41127925/6

Singapore

Level 42, Suntec Tower Three

8 Temasek Boulevard

Singapore 038988

Phone:+65 6829 2123

Texas

21, Waterway Ave

Suite 300

The Woodlands

TX-77380 USA

Phone:+1-281-362-2773

Beijing

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10/F #1003,

11 Beiyuan Shuangying Road,

Chaoyang District, Beijing

China 100012

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Phone: +91 124 4420100

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Santa Clara, CA 95054

Phone: +408-716-8432