Large Indian IT services companies struggle to gain market share against Accenture

[undercover JIX]

Large Indian IT services companies struggle to gain market share against Accenture
According to the report, in the last twelve months, Tier -1 IT services companies that includes TCS, Infosys, Cognizant, HCL Tech, Wipro and MNCs such as Accenture and CapGemini have added nearly $9 billion in incremental revenue
Rukmini Rao Last Updated: September 5, 2019 | 22:38 IST

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The latest research report by Nomura raises concerns that though large Indian IT companies such as Infosys, TCS , Wipro , HCL Tech and Cognizant have retained their market share in the past twelve months , the pace at which they are gaining market share has progressively slowed down in the last four years compared to tech giant Accenture.

According to the report, in the last twelve months, Tier -1 IT services companies that includes TCS, Infosys, Cognizant, HCL Tech, Wipro and MNCs such as Accenture and CapGemini have added nearly $9 billion in incremental revenue. While the market share of the Tier -I companies saw 0 per cent growth, Accenture on the other hand saw its market share growing by 0.6 per cent. In the near-term, the scenario is unlikely to change, says the report. Despite strong deal wins, the year-on-year growth in Tier-I IT companies still remains similar to Accenture (Accenture's guidance of 8- 9 per cent growth). It means that there is no indication of outpacing the growth.

The other reason involves digital revenues. While digital revenues for large Indian IT companies have now crossed over 30 per cent of their overall revenues, it is still nearly half compared to 60 per cent as claimed by Accenture. This becomes critical as the sector is seeing incremental client spends coming in from areas around digital, cloud and security. However, on the brighter side, the Tier-I IT has been able to outpace growth compared to Accenture in the Banking, Financial Services and Insurance (BFSI ) space over the last one year. In the first quarter of FY19, the BFSI revenue growth for the IT sector hovered around 7- 9 per cent and around 18 per cent for Accenture. It stood at 5 per cent in Q1 of FY20 for the Indian Tier-I companies while for Accenture it fell into the negative territory of 2 per cent. In the coming days, sustenance of deal win momentum, concerns around weak macros, largely led by Brexit will hold key in defining the growth.

The report also indicates that management commentary of global IT companies such as Accenture, Cognizant, CapGemini and Epam have indicated macro concerns, which even Indian companies such as TCS, Wipro have alluded to. Infosys and HCL Tech have been an aberration where the companies have indicated better momentum driven by strong deal wins. However, the area of concerns for most global IT players remains around BFSI and manufacturing space. Apart from Epam, rest of the companies have indicated weakness largely led by clients that are large banks in the North America and Europe. For Accenture and Capgemini , manufacturing also remains a concern on the back of trade wars, macro concerns and softness in the auto sector.

https://www.businesstoday.in/buzzto...ket-share-against-accenture/story/377574.html

 

[Protest_again]

Accenture employee headcount in India is over 150000.
https://m.economictimes.com/news/co...rman-accenture-india/articleshow/53611674.cms

While that of cap gemini is well over 100000.
https://www.google.com/amp/s/m.hind...ow-down/story-iv0IiYAfO8DdtMAb68CbrN_amp.html

 

[undercover JIX]

This is what this article and report is pointing to.

While the market share of the Tier -I companies saw 0 per cent growth, Accenture on the other hand saw its market share growing by 0.6 per cent. In the near-term, the scenario is unlikely to change, says the report.

Headcount rant is not part of this report.

 

[nahtanbob]

This is what this article and report is pointing to.


Headcount rant is not part of this report.

it does not matter which company is winning. it matters who is getting employed and who is making money

 

[FCPX]

it does not matter which company is winning. it matters who is getting employed and who is making money

Can you please explain your statement?

 

[nahtanbob]

Can you please explain your statement?

at the end of the day the global companies will outperform Indian IT companies because of better management
Indian managers will have to change their shitty culture if they want to be world beaters. It is a pretty good learning experience for Indian business leaders

In the short term Accenture employs as many Indians as these Indian companies do. It is not like Indians are losing jobs left and right

 

[FCPX]

at the end of the day the global companies will outperform Indian IT companies because of better management
Indian managers will have to change their shitty culture if they want to be world beaters. It is a pretty good learning experience for Indian business leaders

In the short term Accenture employs as many Indians as these Indian companies do. It is not like Indians are losing jobs left and right

OK got it thanks.

 

[Ali_Baba]

In the short term Accenture employs as many Indians as these Indian companies do. It is not like Indians are losing jobs left and right

True, but the profits and technogy, and also intellectual property and rights for reselling producs, now belongs to Accenture, and not an indian company. That is an improvement !!

 

[nahtanbob]

True, but the profits and technogy, and also intellectual property and rights for reselling producs, now belongs to Accenture, and not an indian company. That is an improvement !!

Accenture does not generate IP or technology
In a technology company bulk of the money goes to employee payroll. The profits goes to the shareholders

In the short run Indian companies are losing. In the long run they will win. they just have to copy the improvements in business practices and culture Accenture is following.

This whole space does not have a significant moat for anyone