The global outsourcing industry is constantly evolving through new contracting award characteristics and an expanding universe of successful service providers. ISG's TPI Index helps industry participants, enterprises and organizations keep pace and capitalize from the latest data on outsourcing trends. It is the authoritative source for marketplace intelligence related to outsourcing: transaction structures and terms, industry adoption, geographic prevalence and service provider metrics.

1. The TPI Index
Global Sourcing Market Data and Insights
Second Quarter 2012
Hosted by:
Joseph Foresi, Janney Montgomery Scott
July 12, 2012

2. 2
Welcome to the 39th Quarterly Outsourcing Index Call
Covering the state of the outsourcing industry for global, commercial contracts.
John Keppel
Partner & Chief Marketing Officer, ISG
Duncan Aitchison
Partner & President
North Europe, ISG
© 2012
Information
Services Group, Inc.
All Rights Reserved
isg-one.com
*Contracts with TCV > $25M

3. 3
“
At A Glance
BROADER MARKET TCV WAS UP Y/Y AND Q/Q
MEGA DEAL STRENGTH HELPED OFFSET WEAKER 2Q ACTIVITY
BPO HAD SOLID GAINS Y/Y AND Q/Q
AS EMEA COOLS
“
ASIA-PACIFIC RETURNS AN IMPRESSIVE QUARTER AND HALF YEAR PERFORMANCE,
YEAR TO DATE, STRONG MEGA DEAL AND ASIA-PACIFIC RESULTS WERE NOT
ENOUGH TO OFFSET BROADER MARKET DECLINE
2Q12 TCV 2Q Y/Y 2Q Q/Q 1H12 TCV 1H Y/Y
Score Card ($B) Change Change ($B) Change
Global Market $ 21.4 7% 7% $ 41.4 -8%
Mega Deals $ 6.3 180% 320% $ 7.8 23%
New Scope $ 15.5 9% 34% $ 27.0 -22%
Restructurings $ 5.9 1% -31% $ 14.4 39%
ITO $ 13.1 6% -5% $ 26.8 -6%
BPO $ 8.3 7% 32% $ 14.6 -13%
EMEA $ 8.4 -21% -11% $ 17.8 -24%
© 2012 Asia-Pacific $ 4.7 181% 162% $ 6.5 44%
Information
Services Group, Inc. Americas $ 8.3 6% -6% $ 17.1 flat
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*Contracts with TCV > $25M

4. 4
Broader Market Contract Award Trends
2Q12 TCV was up 7% Q/Q and Y/Y. Year to date, the TCV was down 8%.
Quarterly TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs
$22.7
$26.5
$22.0 $22.1 $20.1 $20.0 $21.4
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+
1H TCV (B) 2H TCV (B)
1H 2H 1H 2H
366
327 308
$42.9 $52.9 $43.8 $57.2
250 $45.4
404
291 286 277 111 130 99 113 $49.0 $51.1 $45.1
231 $40.7 $42.5 $41.4
© 2012 116 115 124 111 96
Information
Services Group, Inc. 2008 09 10 11 2012 2008 09 10 11 2012 2007 2008 2009 2010 2011 2012
All Rights Reserved
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*Contracts with TCV > $25M

5. 5
Broader Market Mega-deals & Mega-relationships Trends
Mega Deal TCV rebounded in 2Q12, driving up Quarterly and Year-to-date
Results. 11 Mega Relationships were awarded in 2Q, the best result since 2009.
Quarterly Mega-deal TCV ($B)*
TCV (B) Counts
5 5 5 5 60% + of 2Q
4 Mega Deal
3 3 3 activity came
2 from Brazil and
1 1 1 1
India
$8.3 $8.8 $7.2 $8.8
$6.2 $7.1 $6.3
$1.0 $2.6 $4.5 $4.1 $2.3
$1.5
2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12
Quarterly Mega-relationship ACV ($B)*
ACV (B) Counts
12 11 11
8 8 50% of Mega
7 Relationships
5 4 4 5
in the last five
quarters were
$1.9 $2.2 $1.8 $2.1 Restructurings
$1.8 $1.8 $1.5
© 2012
$0.7 $1.0 $1.1 $0.6 $0.9 $0.9
Information
Services Group, Inc.
All Rights Reserved 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12
isg-one.com
*Contracts with TCV > $25M

6. 6
Broader Market New Scope & Restructuring Trends
New Scope was up 9% Y/Y and 34% Q/Q. Restructurings were flat Y/Y and down 31%
Q/Q. Year to date, New Scope TCV was down 22% as Restructurings climbed 39%.
Quarterly New Scope vs. Restructuring TCV ($B)*
New Scope Restructured
$16.8 $18.1 $15.5
$14.2
$11.5
$5.2 $8.5
$3.9 $5.8 $5.9
2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year New Scope TCV ($B)* Half Year Restructuring TCV ($B)*
1H TCV (B) 2H TCV (B) Avg of 5 Prior 1Hs 1H TCV (B) 2H TCV (B) Avg of 5 Prior 1Hs
$36.9 $31.3 $41.4 $34.6
$27.6 $35.5
$16.3 $22.7 $10.2
$34.4 $39.3 $33.5 $35.4 $34.8 $8.6 $11.6 $11.5
© 2012
$27.0 $15.7 $14.4
Information $6.3 $9.7 $9.0 $10.4
Services Group, Inc.
All Rights Reserved 2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012
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*Contracts with TCV > $25M

7. 7
ITO Contract Award Trends
ITO TCV was up 6% Y/Y but down 5% Q/Q. Year to date, TCV was down 6% due to
light contracting activity.
Quarterly ITO TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs
$15.6
$17.9 $16.4 $15.8
$12.3 $13.7 $13.1
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+
1H TCV (B) 2H TCV (B)
1H 2H 1H 2H
215 $34.2
210 $26.3 $38.6 $40.3
192 $29.1
155
233 111 130 99 113
186 170 169 $38.9
136 78 85 91 75 $30.0 $32.9 $29.4 $28.4 $26.8
© 2012 65
Information
Services Group, Inc. 2008 09 10 11 2012 2008 09 10 11 2012
All Rights Reserved 2007 2008 2009 2010 2011 2012
isg-one.com
*Contracts with TCV > $25M

8. 8
Top Service Providers Remain Consistent in ITO Market
Since 2010 leading ITO service providers have been remarkably consistent,
battling for share amongst themselves.
ITO TCV* Market Share Comparison by Provider Type
2007–2009 2010–1H12
↓10%
↑3% 63%
↑7% 53%
15% 22% 22% 25%
India-heritage EMEA and Asia Americas MNCs
Cognizant Atos Accenture
HCL BT AT&T
Infosys Capgemini CGI
Mahindra Satyam Fujitsu CSC
TCS T-Systems Dell
Wipro HP
IBM
© 2012
Information
Services Group, Inc. Note: Service providers in alphabetical order within groups; no rankings implied.
All Rights Reserved
Placements based on TCV commercial contract awards sourced from ISG contracts database.
isg-one.com
*Contracts with TCV > $25M

9. 9
BPO Trends in Contract Awards > $25M in TCV
BPO TCV was up 7% Y/Y and 32% Q/Q. Year to Date, TCV was down 13%, but still
performed above the average of recent first halves.
Quarterly BPO TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs
$7.0 Includes
$8.6 $8.3
$7.8 $2.5B of
$6.3 $6.3 Mega
$5.6
Deal TCV
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+ 1H TCV (B) 2H TCV (B)
1H 2H 1H 2H
215
$16.6 $17.0
210 192
$16.3 $14.3
155 $9.6
171
116 $16.1 $16.7 $14.6
© 2012 95 105 108 43 43 30 33 $10.7 $13.1 $12.2
Information 38 30 33 36 31
Services Group, Inc.
All Rights Reserved 2008 09 10 11 2012 2008 09 10 11 2012 2007 2008 2009 2010 2011 2012
isg-one.com
*Contracts with TCV > $25M

10. 10
An Expanded Look: BPO Active Contracts with TCV > $10M
The Broader Market (TCV > $25M) accounts for most of BPO revenue while the
growth is taking place in the $10M to $25M TCV segment.
Annualized Revenues ($B)
$35
$2.8 Current Revenue
$30
TCV Band Revenue Share Growth
$25 $28.8 >$10-$25M 9% 148%
$1.1
$20 91% > $25M 91% 38%
$20.8
95%
$15
5 Years Ago Today
Active Contract Counts
3,100
Active
2,600 Current Contracts
976
2,100 TCV Band Active Contracts Growth
36%
1,600 >$10-$25M 36% 124%
1,100
436 1,731
64% > $25M 64% 72%
© 2012 70% 1,008
600
Information
Services Group, Inc. 100
All Rights Reserved
5 Years Ago Today
isg-one.com
*Contracts with TCV > $25M

11. 11
Top Service Providers in the BPO Market: TCV > $10M
Active BPO Contracts by Function with the 12 Month Growth Rate
↑1.1% ↑13.1%
↑2.3%
373 ↑2.3%
346 ↑17.9%
306
268 ↓0.8%
191 128
F&A FSO Contact Center HRO Industry Specific Procurement
Function Specific Market Share by Provider Types
Global MNC India-heritage Function-specific
21% 35% 21% 42%
14% 18% 42% 48%
2%
27%
65% 63% 61% 47% 52%
31%
11%
FSO HRO Contacts Center Procurement Industry Specific F&A
BONY Mellon Accenture Aditya Birla Minacs Accenture Accenture Accenture
Capita ADP Convergys Capgemini Alliance Data Capgemini
CGI AonHewitt EXLService EXLService Atos EXLService
CSC Capgemini Genpact Genpact Dell Genpact
EXLService Capita IBM Global eProcure EXLService IBM
First Data Ceridian Sitel IBM HCL Infosys
FIS Fidelity TCS Infosys IBM TCS
Fiserv Genpact Teletech Procurian TCS Wipro
© 2012
State Street HP Services Vertex TCS WNS WNS
Information TCS IBM Xerox Xchanging Xerox Xerox
Services Group, Inc. Xchanging Logica
All Rights Reserved
Xerox NorthgateArinso
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Note: Service providers in alphabetical order within functions; no rankings implied.
*Contracts with TCV > $25M counts of commercial contract awards sourced from ISG contracts database.
Placements based on active contract

12. 12
EMEA Contract Award Trends
EMEA TCV was down 21% Y/Y and 11% Q/Q. Year to date, TCV was down by 24%.
Quarterly EMEA TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs
$16.2 $11.0
$10.6 $9.4
$8.4 $9.0 $8.4
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+
1H 2H 1H 2H 1H TCV (B) 2H TCV (B)
158
157
148
$18.6 $34.7
102 $27.3 $23.3
171 $20.5
125 51 61 52 59
© 2012 105 108 $29.9 $23.5
90 $19.6 $17.7 $22.0 $17.8
Information 62 45 50 54 45
Services Group, Inc.
All Rights Reserved 07 08 09 10 11 2012
2008 09 10 11 2012 2008 09 10 11 2012
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*Contracts with TCV > $25M

13. 13
Americas Contract Award Trends
Americas TCV was up 6% Y/Y but down 6% Q/Q. Mega-deals accounted for a
substantial share of 2Q12 TCV. Year to date, TCV was flat.
Quarterly Americas TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs Includes
$3.8B of
Mega Deal
$11.6 $9.2
activity,
$8.5 $8.9
$7.8
$8.8 $8.3 with $2.2
out of Brazil
in Financial
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12 Services
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+
1H TCV (B) 2H TCV (B)
1H 2H 1H 2H
172
129 124 $13.4
106 $19.0 $17.7
$19.2 $16.2
180
138 141 126 61 52
© 2012 116 51 59 $26.3
66 $15.3 $15.6 $18.4 $17.1 $17.1
Information 43 51 44 35
Services Group, Inc.
All Rights Reserved 2008 09 10 11 2012 2008 09 10 11 2012 2007 2008 2009 2010 2011 2012
isg-one.com
*Contracts with TCV > $25M

14. 14
Asia-Pacific Contract Award Trends
Asia-Pacific TCV was up significantly Q/Q and Y/Y with most TCV awards in
Financial Services and Telecom. Year to date, TCV was up 44%.
Quarterly Asia-Pacific TCV ($B)*
TCV (B) Avg of 4 Prior 2Qs
Includes a
$4.7 $4.7 $1.2B Mega
$2.4 Deal in India
$1.8 $1.7 $1.8
$1.4
2Q08 3Q 4Q 1Q 2Q09 3Q 4Q 1Q 2Q10 3Q 4Q 1Q 2Q11 3Q 4Q 1Q 2Q12
Half Year Counts by TCV Bands Half Year TCV ($B)*
TCV $25-99M TCV $100M+ 1H TCV (B) 2H TCV (B)
1H 2H 1H 2H
$6.6
$5.8
36 $8.0
36 $7.1 $4.9
42 41
53
40 43 18 $5.8 $6.4 $6.5
$3.5 $4.5
© 2012
25 28 13 11 9 $2.8
Information 11 19 8 13 16
Services Group, Inc.
All Rights Reserved 2008 09 10 11 2012 2008 09 10 11 2012 2007 2008 2009 2010 2011 2012
isg-one.com
*Contracts with TCV > $25M

15. Special Topic for Second Quarter 2012

16. 16
Duration Trend Impact on the Market
Declines in duration may appear small, but even a slight decline can have large
impact on TCV levels.
What if all 1H12 contracts* had 1999 average durations of 6.4?
1H12 Actual TCV $41 B 38%
Hypothetical 1H12 TCV with 1999-2000 Durations $57 B
Average Contract Durations Over Time
Avg Duration Duration Plateau
6.4
6.0
5.5
6.48
5.1
6.35 6.14 6.10 6.07 5.95 5.88 5.72 5.48 5.31 5.10 4.98 5.05 4.85
© 2012
Information
Services Group, Inc. 1999 00 01 02 03 04 05 06 07 08 09 10 2011 1H12
All Rights Reserved
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*Contracts with TCV > $25M

17. 17
Does the 1H12 duration dip signal the start of a step down?
Durations decreased across a range of contract types.
Distribution of Contracts* Average Durations Fall
Moves Towards Lower Durations for All Contract Sizes*
Durations Durations Durations TCV < $200M TCV > $200M
< 5 Years 5 - 6.9 Years 7+ Years
6.6
6.1 6.2 6.0
46% 51% 4.9 4.8 4.9 4.6
32% 34%
22% 15%
2009 1H12 2009 1H12 2009 1H12 2009 2010 2011 1H12 2009 2010 2011 1H12
BPO Duration Trends* Restructuring Duration Trends*
5.5
5.3 5.3 12%
5.0 10%
4.8 4.8
4.7
4.5
© 2012
Information 2009 2010 2011 1H12 2009 2010 2011 1H12
Services Group, Inc.
All Rights Reserved
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*Contracts with TCV > $25M

18. 18
Factors Influencing Downward Trend in Contract Durations
Average Duration for
Stepped Up Market Competition New Adopters
Amidst increased provider competition, companies ↓14%
– particularly New Sourcing Adopters – push for 5.1
4.4
shorter contract commitments, leveraging the
2009 1H12
providers’ desire to seal the deal.
Outsourcing Savvy Clients and Providers
Solution improvements enable more efficient and effective
delivery of innovations, making the best solutions at the best
prices available via more frequent contract negotiations.
Disposability of Cloud Solutions
© 2012
Service Providers note that contracts with Cloud in scope are shorter
Information
Services Group, Inc.
in duration than Managed Services deals.
All Rights Reserved
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*Contracts with TCV > $25M

19. 19
2Q12 TPI Index Summary and Outlook
 Global Broader Market TCV up 7% Y/Y - strengthened by Mega Deals
 Asia-Pacific experienced significant Y/Y and Q/Q growth
market  New scope TCV was up Y/Y - strengthened on activity outside North
summary America and Western Europe
 BPO was up both Y/Y and Q/Q, while ITO slipped sequentially
 Year to date, TCV was down 8% on weak EMEA results
 Anticipate a soft 3Q against a tough Y/Y compare
market  4Q TCV may pick up because of larger deals in the pipeline
outlook  Unprecedented levels of TCV in 2H12 are required for the market to
meet the record-high 2011 TCV result
© 2012
Information
Services Group, Inc.
All Rights Reserved
isg-one.com
*Contracts with TCV > $25M

20. 20
Learn More
Please contact us with your questions and comments.
► John Keppel ► Duncan Aitchison
Partner & President Research & Partner & President
Managed Services and Chief North Europe, ISG
Marketing Officer +44 (0)1628 21702
+44 (0)7879 432 212 duncan.aitchison@isg-one.com
john.keppel@isg-one.com
--- Media Contacts ---
► Andrew Park ► Rhena Wallace
Director, Global Communications & Cohn & Wolfe for ISG
Branding, ISG +1 212 798 9832
+1 919 259 9252 rhena.wallace@cohnwolfe.com
andrew.park@isg-one.com
© 2012
Information
Services Group, Inc.
All Rights Reserved
isg-one.com www.considerthesourceblog.com
*Contracts with TCV > $25M

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