Embed Size (px)
Citation preview
Copyright © 2019 Everest Global, Inc.
This document has been licensed for exclusive use and distribution by Chain IQ
EGR-2019-22-E-3162
®
™
®
Everest Group PEAK Matrix™ for Procurement Outsourcing
(PO) Service Providers 2019
Focus on Chain IQ
May 2019
2Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Introduction and scope
Everest Group recently released its report titled “Procurement Outsourcing (PO) – Service Provider Landscape with
Services PEAK Matrix™ Assessment 2019.” This report analyzes the changing dynamics of the PO landscape and assesses
service providers across several key dimensions.
As a part of this report, Everest Group updated its classification of 16 service providers on the Everest Group PEAK Matrix™ for
PO into Leaders, Major Contenders, and Aspirants. The PEAK Matrix is a framework that provides an objective, data-driven, and
comparative assessment of PO service providers based on their absolute market success and delivery capability. Everest Group
also identified four service providers as the “2019 PO Market Star Performers” based on the strongest forward movement
demonstrated on the PEAK Matrix year-on-year.
Based on the analysis, Chain IQ emerged as a Major Contender. This document focuses on Chain IQ’s PO experience and
capabilities and includes:
⚫ Chain IQ’s position on the PO PEAK Matrix
⚫ Detailed PO profile of Chain IQ
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.
Source: Everest Group (2019) unless cited otherwise
3Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
™
®
Everest Group PEAK Matrix™
Procurement Outsourcing (PO) BPO Services PEAK Matrix™
Assessment 2019 | Chain IQ positioned as Major Contender
HighLeaders
Major Contenders
Aspirants
Star Performers
Everest Group Procurement Outsourcing (PO) BPO Services PEAK Matrix™ Assessment 20191
Vision & capability
(Measures ability to deliver services successfully)
Mark
et
Imp
act
(Measure
s im
pact cre
ate
d in the m
ark
et)
High
Low
Low
Aspirants
LeadersMajor Contenders
Aegis
Aquanima
CorbusHCL
Exela Technologies
Cognizant
Chain IQ Wipro
WNS
Capgemini Genpact
TCS
Infosys
IBM
GEP
Accenture
1 Assessment for Aquanima excludes service provider inputs and is based on Everest Group’s proprietary Transaction Intelligence (TI) database, service provider public disclosures,
and Everest Group’s interactions with PO buyers
4Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Chain IQ | PO profile (page 1 of 6)
Capabilities
Key leaders
⚫ Claudio Cisullo, Founder & Executive Chairman
⚫ Dr. Urs Dogwiler, Group CEO
⚫ Remo Vettiger, Group COO
⚫ Mark Mortimore, Head Americas & United Kingdom
⚫ Vijoy Varghese, Head Asia-Pacific
Spend managed for external clients
US$10.5 billion
Category expertise: all indirect categories including IT hardware & software /
telecom, marketing & sales, facility management, real estate, operations,
contingent/contract/temp labor, other HR related services, outsourcing & offshoring,
professional services, market data services, brokerage & exchange fees, clearing &
settlement, fleet, insurances, travel, logistics, MRO, and non-production indirect
Scale of operations
Number of PO FTEs1 over time
Key PO-related developments
⚫ 2018: built captive offshore delivery centers in Bucharest and Mumbai to support
cost-efficient global service delivery
⚫ 2018: opened new office in Shanghai extending Chinese Mainland coverage
beyond Hong Kong footprint
⚫ 2018: implementation of a Smart Joint Sourcing App to improve consortia
buying opportunity identification for Chain IQ’s client base
⚫ 2018: investments in RPA, cloud, AI, mobility, blockchain, analytics, and related
capabilities through creation of Innovation & Digitalization Lab to drive and
leverage digital operations and digital insights / developments
⚫ 2018: several digitalization initiatives started covering – building data warehouse
for all client-related procurement data & respective data analytics capabilities
including AI elements; development of own spend management & supplier rating
tools; development of category strategy workflow tool; Implementation of virtual
assistant of Chain IQ’s service desk; development / enhancement of multiple
bots / internal tools (e.g. automated contract collaboration / analysis based on
deep learning) to automate processes
⚫ 2018: expansion of supplier risk management services to supplement the
current Chain IQ’s offering (which currently covers the procurement related
services of supplier risk management) with compliant-/risk-related services
1 Does not include accounts payable, supply chain BPO, and consulting FTEs
203 227281
2016 2017 2018
FTE mix by process scope
>500 FTEs 100-500 FTEs <100 FTEs
Source-to-Contract (S2C) Procure-to-Pay (P2P)
PO service suite
Procurement and sourcing for indirect spend, covering the entire source to pay value
chain with particular focus on the high-value parts of the S2C process. Chain IQ
offers managed services as well as project-based transformational cost reduction
programs including:
⚫ Sourcing / category management related services: spend analytics and
savings potential diagnostics, category management including market intelligence,
strategic sourcing with e-sourcing / e-auctioning, consortia buying, contract
management, supplier base management, compliance management, supplier
evaluation, and supplier risk management
⚫ Operational procurement: buying channel management and optimization, tactical
sourcing, spot buying and tail-end management, P2P operations including supplier
onboarding, requisitioning / order execution / guided buying / invoice processing,
and accounts payable, e-catalog & content management, and supplier enablement
⚫ Other services: responsible supply chain management services, value recovery
services, S2P technology deployment & application management, client service
desk / inquiry handling and self-service platform, smart procurement insights
through data management, and data visualization & performance analytics
including SLA and KPI / KPCs
5Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Chain IQ | PO profile (page 2 of 6)
Client portfolio
Major PO clients:
Chain IQ services a range of clients across various industries and PO value chain components including:
A Swiss multinational investment bank and financial service company, a Fortune 500 company and leading innovator in material science, an American multinational
investment bank and financial service company, a leading Japanese bank with a global network of financial and business centres, an international facility management
provider, a global asset management and investment advisory provider, a major professional sports league, and a multinational medical devices and pharmaceutical
company
PO revenue mix by buyer size (2018)
83-87%
13-17%
Recently-announced multi-process PO engagements
Time of signing Client Contract details
Q1 2018 A leading Japanese bank – The Americas Multi-year; P2P & operational procurement
Q1 2018 An international facility management provider Multi-year; invoice processing and reconciliation
Q2 2018 An American multinational investment bank Multi-year; category/demand management, S2C, operational procurement
Q4 2018 A global asset management and investment advisory providers Multi-year; supplier it risk assessments
Q4 2018 A major professional sports league Multi-year; S2C (strategic & tactical sourcing services)
PO revenue mix by buyer geography (2018)
43-47%
28-32%
18-22%
3-7%
Mid-market
Large
North America
Europe
Asia Pacific
LATAM
PO industry mix by number of clients (2018)
38-42%
23-27%
8-12%
8-12%
3-7%
8-12%
Manufacturing
CPG & retail
Others
Hi-tech
Healthcare &
pharmaFinancial
services
6Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Chain IQ | PO profile (page 3 of 5)
Key delivery locations
Chicago1
Sydney1
Singapore
Tokyo1
Shanghai1
Bucharest2
London
Hong Kong1
Zurich
New York
Mumbai2
1. Includes locations with only operations
2. These locations have shared services as well
7Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Chain IQ | PO profile (page 4 of 6)
Technology solutions
Chain IQ S2P solution
Solution
description
⚫ Chain IQ’s S2P solution is based on a digital
procurement ecosystem, with Chain IQ’s own
integration platform (Smart Connect©) that integrates
best of breed applications across all procurement
value enablers such as analytics, sourcing, procure to
pay, and performance management
⚫ Chain IQ’s S2P modular solution is a cloud-based,
multi-tenant infrastructure that automates the end-to-
end S2P process. It combines Chain IQ proprietary
technology with third-party and client-owned systems.
It seamlessly exchange information across all
applications.The integration platform will be constantly
enhanced to become a full-fledged AI hub
Process scope⚫ Chain IQ solutions include the following procurement processes:
− Category management including market intelligence
− Spend analytics and savings potential diagnostics
− Strategic sourcing including e-sourcing / e-auctioning
− Smart Joint Sourcing / consortia buying
− Tactical sourcing, spot buying, and tail-end management
− Contract management
− P2P operations including supplier onboarding requisitioning,
order execution, and guided buying
− Buying channel management and optimization
Delivery model
and pricing
Technology
leveraged
⚫ Third party tools (Coupa, Basware, Emptoris, Tradeshift, Keelvar,
and Power BI) integrated into proprietary Chain IQ technology
⚫ Chain IQ’s S2P solution leverages different type of digitalization
technologies such as, NLP, RPA, rule based automations,
machine learning, blockchain, and predictive data analytics
⚫ Cloud-based and multi-client
⚫ Cloud-based proprietary Chain IQ technology that is integrated into Chain IQ’s
S2P solution
⚫ Smart Cube, Smart Contract, and Category Strategy Workflow are based on
third -party tools integrated into proprietary Chain IQ technology
⚫ Proprietary solutions included in total solution fee / fee for managed services
⚫ Some solutions are also offered on a stand-alone project basis
⚫ Managed service pricing model that varies depending on client
requirements including not only outcome-based, transactional or
FTE pricing but also gain share and contingency components
Other modular solutions
⚫ Smart Joint Sourcing© App: with an integrated algorithm, the solution significantly
optimizes the client’s effort around planning of joint procurement events through use
of powerful predictive analytics methodologies across sourcing calendars
⚫ Smart Cube: data analytics tool that drives spend visibility, control and identification
of savings potentials. Leverages sourcing and procurement data (e.g. spend
patterns, transaction analysis, benchmarks etc.)
⚫ Smart Contract: contract solution leveraging machine learning to identify whether a
supplier contract draft complies with the predefined templates
⚫ Category Strategy Workflow and Intelligence: category strategy workflow portal
for facilitated category strategy development, capture and store up-to-date business
intelligence and leverage category benchmark data
⚫ Smart Connect Project: initiative savings tracking tool based and used for reporting
of all activities related to sourcing events for clients. Also used for meeting
documentation requirements and requirements related to regulatory compliance
⚫ Smart Check: this product is used for value recovery services, interrogating invoice
data, and finding duplicates according to specific pre-defined algorithms
− E-catalog, content management, and supplier enablement
− Invoice intake, matching, and accounts payable
− Supplier risk management including responsible supply chain management
− Value recovery services
− Client service desk, inquiry handling, and self-service platform
− S2P technology deployment and application management
− Smart procurement insights through data management
− Reporting including SLA and KPI / KPCs
8Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Chain IQ | PO profile (page 5 of 6)
Buyer satisfaction
4.4 4.1
3.3 3.5
3.8
4.4
3.6
5.0 5.0
3.0
4.0
3.0
4.0 4.0
5.0 5.0 5.0 5.0 5.0 5.0 5.0
Process/domain
expertise
Traditional
technology
capability
Next-
generation
technology
capability
Innovation Implementation
/transition
management
Relationship
management
Proactiveness
Buyer satisfaction levels
Scale of 1-5, 5 being the highest
3.8
4.5
5.0
Overall
Chain IQ’s scoreAverage peer score
Source: Procurement Outsourcing (PO) – Service Provider Landscape with Services PEAK Matrix™ Assessment 2019
9Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Strengths Areas of improvement
⚫ Chain IQ, a new entrant in the procurement space, offers end-to-end
procurement services to clients across the globe. The major focus is on
strategic activities – category management and strategic sourcing – for
indirect spend
⚫ Chain IQ has a strong focus on building a technology-led procurement
offering. Through its digital innovation lab, it has built multiple apps for
clients and has its own integration platform – Smart Connect
⚫ One of the key differentiators for Chain IQ is their Smart Joint Sourcing
(SJS) service – this allows them to aggregate spend across clients and
drive additional savings by leveraging advanced analytics
⚫ Chain IQ focuses on offering strong domain expertise and has training
programs to build category management and sourcing capabilities. It also
partners with external partners and institutes to provide training
⚫ Clients have highlighted their category expertise and responsiveness as
key strengths
⚫ Chain IQ needs to build brand awareness. Despite a strong suite of
service offerings and marquee clients, Chain IQ is a relatively lesser
known service provider in the market
⚫ It has a very high onshore presence, which is beneficial to drive high
value sourcing services. However, as it grows and acquires more (and
bigger) clients, it may want to expand offshore presence to provide labor
arbitrage-driven competitive pricing to its clients
⚫ A good proportion of procurement clients requires third-party support for
P2P services. Chain IQ can look to expand its transactional
procurement capabilities to cater to the needs of such clients
⚫ Chain IQ’s clients mentioned that it needs to build better next-generation
digital capabilities such as AI/ML or cognitive- based solutions
Market impact Vision & capability
Market
adoption
Portfolio
mix
Value
delivered Overall
Scope of
services offered
Innovation and
investments
Delivery
footprint
Vision and
strategy Overall
Measure of capability: High Low
Chain IQ | PO profile (page 6 of 6)
Everest Group assessment – Major Contender
10Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Appendix
11Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Strategy (in-house)
⚫ Mission strategy / corporate strategy
⚫ Business strategy
⚫ Geographic strategy
⚫ Technology strategy
Spend data management Strategic sourcing Vendor management
⚫ Baseline analysis
⚫ Data “cube” construct
⚫ Opportunities’ definitions
⚫ Sourcing strategy
⚫ Vendor selection
⚫ Contracting
⚫ Sourcing implementation
⚫ Category management
⚫ Vendor relationship management
⚫ Contract administration
⚫ Service level/standards monitoring
Requisition to PO Invoice processing Accounts payable and T&E
⚫ Approval workflow
⚫ Material requisition
⚫ Purchase order
⚫ Expediting/ troubleshooting
⚫ Material/invoice receipt
⚫ Invoice payment
⚫ Master data maintenance
⚫ Process payment request
⚫ T&E claims processing
⚫ EDI/P-card1 administration
⚫ Month-end closing
⚫ Vendor inquiries
⚫ Reporting
Procurement systems Performance management
⚫ E-auctions
⚫ Catalog management
⚫ Solution hosting
⚫ Financial performance
⚫ Compliance management
⚫ Policies and procedures
⚫ Performance and results reporting
Strategy
Transactionintensive
Judgmentintensive
Procurement pyramid (non-core spend)
S2C
P2P
S2P
Everest Group PO process map
Everest Group distinguishes between the Source-to-Contract (S2C)
and Procure-to-Pay (P2P) processes
12Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
Beyond the process dimension, PO contracts also have a
“procurement-spend category” dimension
Direct
spend
Indirect
spend
Core
spend
⚫ Goods and services that are key ingredients to
manufacture/deliver the final product/service
⚫ They are proprietary or specific to the organization
⚫ For example: Iron ore for a steel manufacturer and
rubber for a tire manufacturer
Source-to-Contract
(S2C)
Procure-to-Pay
(P2P)
Source-to-Pay (S2P) cycle
⚫ Goods and services that are commonly required to
manufacture/deliver the final product/service
⚫ They are commodities in that industry
⚫ For example: Lubricants, packaging, and
Maintenance, Repair, & Overhaul (MRO)
⚫ Non-production goods and services that are not
required to manufacture/deliver the final
product/service but are required to operate the
organization
⚫ For example: Spend categories such as facilities,
office supplies, travel & logistics, marketing-/sales-
related spend, and IT/telecom
High prevalence of third-party outsourcing Low prevalence of third-party outsourcing
Non-core
spend
Non-core
direct
spend
13Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
™
®
Everest Group PEAK Matrix™ is a proprietary framework
for assessment of market impact and vision & capability
Everest Group PEAK Matrix
Vision & capability
Measures ability to deliver services successfully
High
Low
Low High
Leaders
Aspirants
Ma
rke
t im
pa
ct
Measure
s im
pact cre
ate
d in the m
ark
et
Major Contenders
14Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
™
®
Services PEAK Matrix™ evaluation dimensions
Measures impact created in the market –
captured through three subdimensions
Market adoption
No. of clients, revenue base, and
YOY growth, deal value/volume
Portfolio mix
Diversity of client/revenue base
across geos and type of
engagements
Value delivered
Value delivered to the client
based on customer feedback
and transformational impact
Vision and strategy
Vision for the client and itself;
future roadmap and strategy
Scope of services offered
Depth and breadth of services
portfolio across service sub-
segments / processes
Innovation and investments
Innovation and investment in the
enabling areas, e.g., technology
IP, industry/domain knowledge,
innovative commercial
constructs, alliances, M&A, etc.
Delivery footprint
Delivery footprint and global
sourcing mix
Measures ability to deliver services successfully.
This is captured through four subdimensions
Mark
et
imp
act
Vision & capability
Major Contenders
Leaders
Aspirants
15Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
™
®
Everest Group confers the Star Performers title on providers
that demonstrate the most improvement over time on the
PEAK Matrix™
Star Performers
are identified by
top quartile
performance
improvement on
the X and Y axes
for each segment
Methodology
Everest Group selects Star Performers based on the relative YOY improvement on the PEAK Matrix
Year 1
Year 0
Ma
rke
t Im
pa
ct
Vision & capability
We identify the service providers whose improvement
ranks in the top quartile and award the Star Performer
rating to those service providers with:
⚫ The maximum number of top-quartile performance
improvements across all of the above parameters
AND
⚫ At least one area of top-quartile improvement
performance in both market success and capability
advancement
The Star Performers title relates to YOY performance for a given service provider and does not reflect the overall
market leadership position, which is identified as Leader, Major Contender, or Aspirant.
In order to assess advances on market impact,
we evaluate each service provider’s performance
across a number of parameters including:
⚫ Yearly ACV/YOY revenue growth
⚫ # of new contract signings and extensions
⚫ Value of new contract signings
⚫ Improvement in portfolio mix
⚫ Improvement in value delivered
In order to assess advances on vision and
capability, we evaluate each service provider’s
performance across a number of parameters
including:
⚫ Innovation
⚫ Increase in scope of services offered
⚫ Expansion of delivery footprint
⚫ Technology/domain specific investments
16Copyright © 2019, Everest Global, Inc.
EGR-2019-22-E-3162
®
FAQs
Does the PEAK Matrix™ assessment incorporate any subjective criteria?
Everest Group’s PEAK Matrix assessment adopts an unbiased and fact-based approach (leveraging service provider / technology vendor 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/vendor briefings
Is being a “Major Contender” or “Aspirant” on the PEAK Matrix, an unfavorable outcome?
No. The PEAK Matrix highlights and positions only the best-in-class service providers / technology vendors in a particular space. 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”?
A PEAK Matrix position is only one aspect of Everest Group’s overall assessment. In addition to assigning a “Leader”, “Major Contender,” or “Aspirant” 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/vendors for their specific requirements. It also helps
providers/vendors 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/vendors 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
What is the process for a service provider / technology vendor to leverage their PEAK Matrix positioning and/or “Star Performer” status ?
⚫ Providers/vendors can use their PEAK Matrix positioning or “Star Performer” rating in multiple ways including:
– Issue a press release declaring their positioning. See citation policies
– Customized PEAK Matrix profile for circulation (with clients, prospects, etc.)
– Quotes from Everest Group analysts could be disseminated to the media
– Leverage PEAK Matrix 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.
Does the PEAK Matrix evaluation criteria change over a period of time?
PEAK Matrix assessments are designed to serve present and future needs of the enterprises. Given the dynamic nature of the global services market and
rampant disruption, the assessment criteria are realigned as and when needed to reflect the current market reality as well as serve the future expectations
of enterprises
About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business
services, and sourcing. We are trusted advisors to senior executives of leading
enterprises, providers, and investors. Our firm helps clients improve operational
and financial performance through a hands-on process that supports them in making
well-informed decisions that deliver high-impact results and achieve sustained value.
Our insight and guidance empower clients to improve organizational efficiency,
effectiveness, agility, and responsiveness. What sets Everest Group apart is the
integration of deep sourcing knowledge, problem-solving skills and original research.
Details and in-depth content are available at www.everestgrp.com.
Dallas (Headquarters)
+1-214-451-3000
Bangalore
+91-80-61463500
Delhi
+91-124-496-1000
London
+44-207-129-1318
New York
+1-646-805-4000
Toronto
+1-416-388-6765
®
Social Media
@EverestGroup
@Everest Group
Stay connected
Website
www.everestgrp.com
Blog
www.everestgrp.com/blog/
