India's top IT services companies, Tata Consultancy Services (TCS), Infosys Technologies and Wipro Technologies will emerge as the next generation of IT service megavendors, according to Gartner, Inc. These vendors are increasingly being considered for strategic service deals, and will augment or in some cases, replace today's acknowledged megavendors by revenue IBM Global Services, Accenture and EDS - in this space by 2011.These emerging megavendors are much smaller than the current megavendors but will increasingly compete for the same mega deals that had been the exclusive domain of the incumbent megavendors, the report adds. The emerging megavendors have leveraged four critical competencies to achieve their status. The competencies are process excellence, worldclass HR practices, providing high quality services at a low cost and the achievement of significant and disproportionate 'mind share' compared to their actual size.
"The emerging megavendors have made dramatic progress in the past few years and have more than doubled their revenues in a four-year period, with the 2007 revenues being 2.6 times the 2004 revenues," said Partha Iyengar, vice president, analyst and regional research director, Gartner. "This level of growth differential has continued even as these vendors have become multibillion dollar enterprises.
To put this in context, there are just 100 service enterprises globally with more than $1 billion in revenues." The Indian providers will have to address the issue of moving away from resource intensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count, which is the situation that exists today.
They will have to achieve similar (to the current megavendors) levels of revenue per employee benchmarks to truly achieve megavendor status
"The emerging megavendors have made dramatic progress in the past few years and have more than doubled their revenues in a four-year period, with the 2007 revenues being 2.6 times the 2004 revenues," said Partha Iyengar, vice president, analyst and regional research director, Gartner. "This level of growth differential has continued even as these vendors have become multibillion dollar enterprises.
To put this in context, there are just 100 service enterprises globally with more than $1 billion in revenues." The Indian providers will have to address the issue of moving away from resource intensive revenue growth to a model that provides higher leverage and increases revenue without a linear relationship to head count, which is the situation that exists today.
They will have to achieve similar (to the current megavendors) levels of revenue per employee benchmarks to truly achieve megavendor status
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