HfS and Accenture Publish Procurement Outsourcing Analysis – Essential Reeding

Back in December, outsourcing analyst firm HfS produced a “blueprint” report – “Procurement-As-a -Service 2016” - which looked at the changing market for procurement outsourcing services. It analysed 15 service providers, going into considerable depth on the market and those individual providers.

In the time-honoured fashion of this type of report, there is a bit of the “everybody must have prizes” feel to the ratings, with 6 providers in the “winner’s circle”, 4 others defined as “execution powerhouses”, 2 more as “high performers”…  So as an aid to supplier selection, you have to dig into the detail.  And you might excuse me a touch of cynicism when I see the “high performer” ranking for CSC/Xchanging, given that since they acquired Xchanging last year it is far from clear CSC have any real intent to be in this market at all (look at their UK website and see if you can find anything about procurement outsourcing. I couldn’t).

Anyway, Accenture, who come out of the analysis very well, have now made a substantial excerpt from the full report freely available here. There is a lot of really good material in the 67 pages, although the detailed provider review is only given for Accenture itself, for understandable reasons given they have sponsored the report’s availability. But there is still much here at market and supplier level that will be useful for anyone looking at procurement outsourcing.

There are a number of interesting trends towards smaller and shorter deals, which fits our (less analytical) view that the days of the mega-outsource seem to have passed, as we’ve said before. There is more focus on innovative fee models too. But there is a lot of jargon around this industry and it is hard to know whether certain trends are really innovative or just dressing up old processes and ideas – “Design Thinking” for instance gets a lot of coverage. Hyperbole creeps in too – one provider claims that in terms of resource availability they have “a scalable 'virtual' bench of almost 1 million professionals across industries” which seems like pure fantasy. I’d love to ask them to name the million ….

We did enjoy spotting the typos and grammatical howlers in the report too – really, HfS and / or Accenture need a decent editor. We have “deals valued grater than $100 Million”, but our favourite is “2016 has seen a draught in terms of megadeals” – yes, 2016 was very windy. We suspect they mean “drought”.

But don’t let our somewhat smart-arse criticisms put you off – this is a very insightful and useful report, essential reading for anyone who is already interested in procurement outsourcing, or is looking to make a move in that direction.

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