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Accenture Expands Even As the IT Outsourcing Market Outlook Remains Uncertain

Accenture Expands Even As the IT Outsourcing Market Outlook Remains Uncertain


Charles Harper,
August 9, 2010

(Blog) Even as industry leaders point to an uncertain outlook for IT Outsourcing for the rest of 2010, Accenture moved quite rapidly in July 2010 to grow its market share for the current year and beyond. Within the month of July, the company has announced the acquisition of a French business processing company, the expansion of its operations in the Philippine Islands and the securing of a major outsourcing deal in Bangalore, India.

Viewed separately, the actions appear to be somewhat random; however, when viewed as parts of the whole it is clear that Accenture is planning for future growth beyond 2010.
The company’s acquisition of the privately held French based company, Acceria, will hasten its push into the automotive market utilizing a unique product mix and pricing structure to reach new clients with new solutions. Accenture believes that an intensive focus on ‘after-sales revenues’, which was a specialty for Acceria, will provide the company the ability to present innovative solutions to both automotive and industrial companies with flat lining revenue streams.

Accenture also announced that it was looking to expand its operations in Cebu, a city in Philippine Islands; a sign that Accenture continues to grow it operations having originally established its presence only two years ago in 2007.

At that time the company established a call center operation along with a Global Network for Technology. As it is the second largest center of activity within Accenture’s outsourcing operations, the Philippines is important due to its capacity for highly skilled, yet cost effective manpower. The 14,000 employee force allows Accenture to seamlessly provide Business Process and IT services as clients opt in to increasing their existing mix of services. The critical nature of this location to the long term growth of the company was underscored in late June as Accenture pledged to invest 1.26 million in Cebu’s education system to assist underprivileged young men and women attain marketable IT skills.

In its outsourcing conquest, Accenture was able to secure a contract with a Bangalore company called United Spirits or USL. Because USL, which is the world’s second largest maker of spirits (alcoholic beverages) , wanted to increase their access to business intelligence through information technology; the firm wanted to give that role to an expert.

Accenture was in prime position to influence the choice as it has been associated with USL for most of the new millennium. The firm (Accenture) had an even more direct inside track as it served as an advisor for USL’s recent merger activity with Shaw Wallace. Accenture will use its IT knowledge capability to integrate USL’s product distribution and assessments about customer demand. The company was able to use its size, brand and existing relationships to make itself more attractive than its rivals, as even in a more uncertain environment; price cutting has been ineffective for firms within the IT outsourcing space.

According to CIO magazine, Accenture remains one of the top ten outsourcers for the first half of 2010. And with these kind of proactive initiatives, it is looking to ensure that position for a long time.

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