Last week’s announcement that Accenture acquired Procurian will significantly stir up competitive market dynamics. For Accenture, the acquisition adds approximately 800 FTEs, additional depth and coverage of some direct materials categories, and a broad base of clients in consumer products.
Additionally, this strategic move provides a base of sourcing personnel currently provided through Accenture’s management consulting unit. Procurian also brings a strong focus and tool set in the category management area, allowing for the measurement, analysis and tracking of forecasted and realized savings.
In terms of broader market impact, the move creates four distinct groups of players:
- The leaders: The primary strength of Accenture/Procurian and IBM will be the large amount of spend each company is sourcing and the corresponding skills and technology available for managing this spend and delivering savings to clients.
- The major India Heritage and multinational providers: Capgemini, Wipro, Infosys and Genpact have a solid transaction capability but may need additional attention to enhance their capabilities in the sourcing and category management space, considering their historical partnering with Procurian.
- Niche and regional players: Xchanging, GEP, and remaining Indian Heritage companies are strong in specific areas but will need to develop their strategies to compete in the broader market.
- Multinational BPO companies: HP, ACS/Xerox , Proxima, Aegis, TCS, HCL, Corbus and WNS, amongst others, will need to access their capabilities in this area and articulate their strategies to the market.