Contributing writer

The top 10 IT outsourcing service providers

News Analysis
Jun 15, 20236 mins
Managed Cloud ServicesOutsourcingTechnology Industry

Accenture maintained its hold at the top of the IT service provider market, as TCS inched to No. 2 and CapGemini leapfrogged to No. 6 in a year marked by a more incremental approach to modernization, according to Everest Group’s 7th annual rankings.

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Credit: master1305

Everest Group’s annual ranking of the top IT service providers saw significant shuffling again this year, but one thing that remained unchanged was Accenture’s position at the top of the list. For the seventh year in a row, the $61.6 billion firm was recognized as the leading service provider of the year, a testament to its broad leadership across categories, including application services, enterprise platform services, and industry-specific services in insurance and life sciences.

“Their breadth and depth of expertise has allowed them to obtain both the highest number of participations and leader recognitions across all evaluations conducted in 2022 — an achievement that is a significant challenge for their closest peers to beat,” says Abhishek Singh, partner with Everest Group.

Mumbai-based TCS moved up a spot to second based largely on bolstering its cloud services value proposition and an increased focus on sustainability and talent management, according to Singh. TCS also enhanced its data and digital capabilities, offering interactive experience services, and doubled down on its industry-specific solutions. Its facility leveraging public cloud competencies across the big three (Google Cloud, Microsoft Azure, and AWS) and joint ventures with strategic partners such as insurtechs helped elevate its status as well, Singh says.

Meanwhile, CapGemini leapt from sixth to No. 3 this year. The Paris-based IT services and consulting firm strengthened its capabilities in banking and financial services, insurance, life sciences, and data and analytics services, winning leader of the year recognition in each of those categories.

Rounding out the top five were No. 4 Wipro (seventh last year) and No. 5 HCLTech, which slipped a spot from fourth. Bengaluru-based Wipro’s ascension reflects its consistency in services coverage across multiple domains, as well as winning leader of the year for the banking and financial services sector. Despite its slight demotion, Noida-based HCLTech was recognized as a star performer, having demonstrated growth momentum in its offering for healthcare enterprises across payor and care provider markets, according to Singh.

Top 10 IT service providers of the year

  1. Accenture
  2. TCS
  3. CapGemini
  4. Wipro
  5. HCLTech
  6. Cognizant
  7. Infosys
  8. NTT
  9. IBM
  10. LTI/Mindtree (new entrant of merged entity)

Credit: Everest Group 2023

Like HCLTech, Cognizant also moved down a rung to sixth place. Infosys fell more dramatically from last year’s No. 2 position to seventh this year, more due to stronger performance by other IT services providers than any dips in its own performance.

“In 2022, Infosys’ peers showcased a stronger breadth and depth of coverage across domains such as digital services, interactive experience services, and life sciences industry-focused services,” explains Singh, noting that the difference in scores among Infosys and its higher-ranking counterparts was minimal.

Rounding out the top 10 were NTT (up a position to No. 8), IBM slipping a spot to No. 9, and LTIMindtree making its entrance on the leaderboard as a newly merged company. Again, IBM’s demotion is more a reflection of its competitors more balanced service coverage. In fact, notes Singh, Big Blue has ramped up its capabilities across enterprise platform services, cybersecurity and threat intelligence, and interactive experience domains.

LTIMindtree, which began operating as a merged entity in November, is expected to benefit from its combined economies of scale and expanded geographic footprint.

“LTIMindtree demonstrates how the whole can be greater than the sum of its parts,” says Singh. Mindtree brings its experience working with UK- and APAC-based clients while LTI has a strong history with continental European and North American clients. LTI’s strong credentials in data and AI capabilities also complement Mindtree’s cloud and product engineering heritage, says Singh, enabling the new company to offer more holistic services coverage and technology expertise. All eyes will be on LTIMindtree in the year ahead with its potential to unlock more of those synergies.

Further down the list, there were three new entrants to the top 20. Singh explains that EY (#18) has performed well across enterprise platform services and banking and financial services-specific, Orange Business Services (#19) entered this list on the back of its strong cloud capabilities, and EPAM (#20) has displayed steady performance across multiple domains including life sciences, healthcare, and cloud/infrastructure.

Everest Group has been ranking service providers based on their performance in 26 categories, including key business lines, geographies, and technologies, since 2016. Throughout the year, the company evaluates service providers’ market success, their business strategies, and how they are investing to align themselves with future enterprise IT demand.

This year’s rankings come during a period of increasing buying maturity, notes Singh, “where

clients are seeking a more incremental approach to modernization rather than commit to longer cycles or periods of transformation in a challenging macroeconomic environment.” Companies landing on these lists have tailored their offerings to deliver swifter value realization and improved cost predictability — key priorities of IT leaders and business stakeholders alike. 

The annual report also calls out “star performers” that have shown the strongest year over year improvements in key capabilities. TCS was the top star performer, with the strongest increases in its cloud/infrastructure and digital services. CapGemini and HCLTech tied for second place among star performers. CapGemini’s growth was in data and analytic services and HCLTech’s in healthcare services.

CIOs looking for partners beyond the biggest players should peruse Everest’s ranking of challengers: those service providers with less than US$2 billion in annual revenue that have demonstrated strong market credentials to partner with enterprises in the digital-first era. The top four challengers — Mphasis, Virtusa, Zensar, Coforge — and UST Global (#6) frequently compete with their larger counterparts for business. Some notable new entrants on the challenger leaderboard include Brillio (#5), Stefanini (#7), Microland (#8), CitiusTech (#9), and Persistent Systems (#10).

These firms can offer compelling alternatives with offerings focused on specific solution segments, geographies, or industries, according to Singh.

“The mindshare being captured by challengers has been rising steadily over the last few years, making in-roads into large enterprise accounts,” Singh says. “They typically offer higher client intimacy with leadership involvement during delivery, better program governance, technical expertise across niche areas, and contextualized offerings for industry-specific pain-points. In many cases, CIOs bring these challengers from their previous roles where they had a positive experience of working with them.”