Everest Group PEAK Matrix for Banking BPO Focus on TCS · PDF fileKumar Srinivasan, Head...
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Everest Group PEAK Matrix for capital markets BPO
Focus on TCS
December 2012
Copyright © 2012, Everest Global, Inc.
Proprietary & Confidential. © 2012, Everest Global, Inc. 2
Introduction and scope
Everest Group recently released its report titled “A PEAK into the Leaders, Major Contenders, and Emerging
Players of Capital Markets BPO”. This report analyzes the changing dynamics of the Capital Markets BPO
landscape and assesses service providers across several key dimensions.
As a part of this report, Everest Group updated its classification of 14+ service providers on the Everest Group
Performance | Experience | Ability | Knowledge (PEAK) Matrix for Capital Markets BPO into Leaders, Major
Contenders, and Emerging Players. The PEAK Matrix is a framework that provides an objective, data-driven,
and comparative assessment of Capital Markets BPO service providers based on their absolute market
success and delivery capability.
Based on the analysis, TCS emerged as a Leader. This document focuses on TCS’s Capital Markets BPO
experience and capabilities and includes:
TCS’s position on the Capital Markets BPO PEAK Matrix
Detailed Capital Markets BPO profile of TCS
Buyers can use the PEAK Matrix to identify and evaluate different service providers. It helps them understand
the service providers’ relative strengths and gaps. However, it is also important to note that while the PEAK
Matrix is a useful starting point, the results from the assessment may not be directly prescriptive for each
buyer. Buyers will have to consider their unique situation and requirements, and match them against service
provider capability for an ideal fit.
Proprietary & Confidential. © 2012, Everest Global, Inc. 3
Everest Group’s definition of BFSI includes the
following three segments
1 Business-to-consumer relationships
2 Business-to-business relationships
Retail financial services
(B2C1)
– Retail banking
– Lending
– Cards
Commercial banking (B2B2)
Banking
Investment banking
Asset management
Custody & fund
administration
Brokerage
Capital markets
Life & pensions
Property & casualty
Insurance
Banking, Financial Services,
and Insurance (BFSI)
Focus of this document
Note: This document relates to vertical-specific BPO within the capital markets space. The document does
not include coverage of horizontal business processes such as F&A, HR, procurement, and contact centers
Proprietary & Confidential. © 2012, Everest Global, Inc. 4
Everest Group PEAK Matrix – 2012 capital markets
BPO standing
Performance | Experience | Ability | Knowledge
Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix for capital markets BPO
Capital markets BPO delivery capability1
(Scale, scope, technology, and delivery footprint)
Leaders
Major Contenders
Emerging Players
1 Service providers scored using Everest Group’s proprietary scoring methodology given in the Appendix
Source: Everest Group (2012)
Ma
rke
t s
ucc
es
s
25
th p
erc
en
tile
High
Low 25th percentile
75th percentile
Low High
75
th p
erc
en
tile
Cognizant
eCLERX
TCS Syntel
Wipro Genpact
Infosys
HP
WNS iGate
HCL
Capgemini
EXL Service
Mahindra Satyam
Proprietary & Confidential. © 2012, Everest Global, Inc. 5
TCS (page 1 of 5)
Capital markets BPO overview
Recent acquisitions and partnerships
2012 – TCS and Mitsubishi form JV to establish an IT,
BPO, and infrastructure services delivery center in Japan
2012 – TCS BaNCS signed an agreement with Savvis, a
CenturyLink company and a global leader in cloud
infrastructure for hosting and cloud-enabled core banking,
payments, and compliance
Recent developments
FORETM – Transformation model for business
Capital Markets Domain Academy equipped with a web
tool “Pedagogue” for competency development
Created best-in-class capital markets process maps for
which patent has been filed
Suite of services
Client and reference data management
Order entry and trade execution
Trade confirmation and settlement
Wealth management and brokerage
Cash management and financing
Stock lending
Asset servicing (including corporate actions)
Transfer agency
Custody and fund administration
Reconciliation
Risk management (market, credit, and liquidity)
Trade analytics
2009 2010 2011
Revenue (US$ million) N/A 75 80
Number of FTEs 440 2,500 2,700
Number of clients N/A 7 10
Company overview
TCS offers a range of information technology and consultancy services.
The company’s offerings include application development, infrastructure
management, engineering services, and business process services
(BPO) including analytics & insights. TCS also offers platform solutions
for specific business functions, such as the TCS BaNCS application for
capital markets, banking, payments, reconciliations, insurance, and
finance & accounting
Key leaders
Abid Ali, Global Head, BPO Services, TCS
Dinanath Kholkar, Head – BFS & INS, BPO Services, TCS
Kumar Srinivasan, Head – Capital markets BPO Services, TCS
Headquarter: Mumbai, India
Website: www.tcs.com
Source: Everest Group (2012)
Proprietary & Confidential. © 2012, Everest Global, Inc. 6
TCS (page 2 of 5)
Capital markets BPO location landscape
Chennai Mumbai
Bangalore
Dalian
Gurgaon
Source: Everest Group (2012)
Proprietary & Confidential. © 2012, Everest Global, Inc. 7
TCS (page 3 of 5)
Capital markets BPO – capabilities and key clients
Key capital markets engagements
Client name Line of business Region
Year since
client
Citi Client data management, order entry & trade execution, fund administration, asset
servicing, transfer agency and investment products, private banking, wealth, settlement,
cash management & financing, and recon
North America, Europe, and
Asia Pacific
2008
Fortune 100
investment bank
Settlement operations, stock lending, client & securities reference data management,
wealth management services, operations risk and control, and network & global banking
services
North America, Europe, and
Asia
2010
Global Fortune 150
investment bank
Client reference data management, risk operations (including market and credit &
liquidity risks), reconciliation, and L1 help desk services
North America and Europe 2004
Split of FTEs by location
FTEs in numbers
Capital markets BPO revenue mix by
geography
Revenue in US$ million
Capital markets BPO FTE mix by segment
FTEs in numbers
100%
Offshore
55% 42%
3%
North
America
Europe Asset
management
Investment
banking
Asia Pacific
100% = 2,700 100% = 80
Wealth
management &
Retail brokerage
Custody & fund
administration
44%
40%
11% 5%
100% = 2,700
Note: Based on the contracts signed till December 2011
Source: Everest Group (2012)
Proprietary & Confidential. © 2012, Everest Global, Inc. 8
Tools
TCS BaNCS financial services
product Reconciliation platform
TCS BaNCs-Credit Risk
Management Platform(GCRM) TRAPEZE
Solution
description
TCS BaNCS enables
transformation in financial
services through a superior and
holistic suite of solutions for
banks, capital market firms,
insurance companies, and
diversified financial institutions.
Each solution in the TCS
BaNCS family is designed to
run as a scalable and robust
service, fully integrated with
existing business models,
enterprise infrastructures, and
technology architectures
On-premise trade reconciliation
solution
Back-office credit risk
management system. Holds
exposures, limits, ratings and
credit review information for
counterparties with whom the
bank trades
TCS delivery ecosystem
consisting or governance,
reporting, workflow, document
management, and process
management applications apart
from domain-specific
accelerators
Year launched 2006 2009 N/A 2011
Line of
business
All Investment banking Investment banking All
Number of
clients
>300 5 investment banks 1 investment bank 7
TCS (page 4 of 5)
Capital markets BPO technology solutions
Proprietary & Confidential. © 2012, Everest Global, Inc. 9
TCS is a Leader on Everest Group PEAK Matrix for capital markets BPO
TCS (page 5 of 5)
Competitive position and assessment
Delivery capability assessment
Assessment
dimension Rating Remarks
Scale More than 2,700 FTEs in capital markets BPO
Scope Significant scale and presence across all lines
of business and most geographies
Technology capability Has a number of sophisticated platforms
besides add-on tools across the capital
markets BPO value chain
Delivery footprint Five delivery centers for capital markets BPO
but no onshore or nearshore capability
High Low
Market share by region
North America Europe South America Asia Pacific
13% 19% - 6%
Market share by capital markets BPO line of business
Investment
banking
Asset
management
Custody & fund
administration Brokerage
13% 32% 3% 11%
Overall market share
By number of contracts By FTEs By revenue
7% 16% 14%
Overall remarks
TCS leverages its IT heritage and delivery capabilities to achieve market
success across lines of business and geographies. With strong delivery
capabilities and market traction, it emerges as a Leader in capital markets
BPO
TCS is investing significantly in developing domain expertise with its own
training academy
Although dominated by its acquisition of Citigroup’s back-office operations
(2008), TCS acquired new clients to widen its client portfolio
Investing in building onshore delivery capabilities and expanding beyond
traditional markets to Asia Pacific (Japan)
Needs to develop greater traction in the South American market, bolster
capabilities in custody & fund administration, and increase the number of
clients further to avoid concentration risk
Capital markets BPO delivery capability
Ma
rke
t s
uc
ce
ss
High
Low Low High
TCS
Leaders
Major Contenders
Emerging Players
Copyright © 2012, Everest Global, Inc. 10
Appendix
Copyright © 2012, Everest Global, Inc. 11
Top quartile performance
across market success
and capability
2nd or 3rd quartile
performance across market
success and capability
4th quartile performance
across market success
and capability
High
Low
25
th p
erc
en
tile
75
th p
erc
en
tile
75th percentile
Ma
rke
t s
ucc
es
s
Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix
Emerging Players
Leaders
Major Contenders
Capital markets BPO delivery capability
(Scale, scope, technology, and delivery footprint)
Low High 25th percentile
Everest Group classifies capital markets BPO service providers into
Leaders, Major Contenders, and Emerging Players on the Everest
Group Performance | Experience | Ability | Knowledge (PEAK) Matrix
Copyright © 2012, Everest Global, Inc. 12
Measures the scope of
services provided
across segments,
processes, industries,
geographies, etc.
Measures the capability
and investment in tools
and technologies that
help deliver better
services
Measures the delivery
footprint and the global
sourcing mix through
delivery footprint across
regions and offshore
delivery capability
Measures success
achieved in the market.
Captured through capital
markets BPO revenue
Measures ability to deliver services successfully.
Captured through four subdimensions
Measures the scale of
operations (overall
company revenue, capital
markets BPO revenue,
number of FTEs, etc.)
Scale Scope Technology capability Delivery footprint
Emerging Players
Leaders
Major Contenders
Ma
rke
t s
ucc
es
s
Delivery capability
Service providers are positioned on the PEAK Matrix
based on evaluation across two key dimensions
Source: Everest Group (2012)
Copyright © 2012, Everest Global, Inc. 13
FAQs (page 1 of 2)
Does the PEAK Matrix assessment incorporate any subjective criteria?
– Everest Group’s PEAK Matrix assessment adopts an objective and fact-based approach (leveraging service
provider RFIs and Everest Group’s proprietary databases containing providers’ deals and operational capability
information). In addition, these results are validated / fine-tuned based on our market experience, buyer
interaction, and provider briefings
Is being a “Major Contender” or “Emerging Player” on the PEAK Matrix, an unfavorable outcome?
– No. PEAK Matrix highlights and positions only the best-in-class service providers in a particular functional/vertical
services area. There are a number of providers from the broader universe that are assessed and do not make it to
the PEAK Matrix at all. Therefore, being represented on the PEAK Matrix is itself a favorable recognition
What other aspects of PEAK Matrix assessment are relevant to buyers and providers besides the “PEAK
Matrix position”?
– PEAK Matrix position is only one aspect of Everest Group’s overall assessment. In addition to assigning a
“Leader”, “Major Contender” or “Emerging Player” title, Everest Group highlights the distinctive capabilities and
unique attributes of all the PEAK Matrix providers assessed in its report. The detailed metric level assessment and
associated commentary is helpful for buyers in selecting particular providers for their specific requirements. It also
helps providers showcase their strengths in specific areas
What are the incentives for buyers and providers to participate/provide input to PEAK Matrix research?
– Participation incentives for buyers include a summary of key findings from the PEAK Matrix assessment
– Participation incentives for providers include adequate representation and recognition of their capabilities/success
in the market place, and a copy of their own “profile” that is published by Everest Group as part of the
“compendium of PEAK Matrix providers” profiles
Copyright © 2012, Everest Global, Inc. 14
FAQs (page 2 of 2)
What is the process for a service provider to leverage their PEAK Matrix positioning status ?
– Providers can use their PEAK positioning rating in multiple ways including:
Issue a press release declaring their positioning/rating
Customized PEAK profile for circulation (with clients, prospects, etc.)
Quotes from Everest Group analysts could be disseminated to the media
Leverage PEAK branding across communications (e-mail signatures, marketing brochures, credential packs,
client presentations, etc.)
– The provider must obtain the requisite licensing and distribution rights for the above activities through
an agreement with the designated POC at Everest Group
Copyright © 2012, Everest Global, Inc. 15
Everest Group
Leading clients from insight to action
Everest Group is an advisor to business leaders on the next generation of global services with a worldwide reputation for helping
Global 1000 firms dramatically improve their performance by optimizing their back- and middle-office business services. With a
fact-based approach driving outcomes, Everest Group counsels organizations with complex challenges related to the use and
delivery of global services in their pursuits to balance short-term needs with long-term goals. Through its practical consulting,
original research, and industry resource services, Everest Group helps clients maximize value from delivery strategies, talent and
sourcing models, technologies, and management approaches. Established in 1991, Everest Group serves users of global
services, providers of services, country organizations, and private equity firms in six continents across all industry categories. For
more information, please visit www.everestgrp.com and research.everestgrp.com.
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