Capgemini, HCL Technologies and Alten top the leaderboard of ES service providers as ER&D outsourcing bounces back with double-digit growth in 2021.
DALLAS, Nov. 15, 2022 /PRNewswire-PRWeb/ -- Everest Group today released the fourth annual edition of the Everest Group Engineering Services Top 50™, a ranking of the world's largest third-party providers of engineering services (ES). The ranking is based on revenues and year-on-year growth.
Topping the 2020 list of ES providers are these 10 leaders:
1. Capgemini
2. HCL Technologies
3. Alten
4. Cognizant
5. Akkodis
6. Accenture
7. AFRY (ÅF Pöyry)
8. Wipro
9. Tata Consultancy Services
10. EPAM
*** Download a complimentary copy of the 2022 Everest Group ES Top 50 list and analysis ***
Engineering services include all activities (spanning software, embedded, mechanical and manufacturing engineering functions) that support the design, development, testing and management of products, both hardware and software.
After contracting slightly (-1.7%) in 2020, the global Engineering, Research & Development (ER&D) industry grew 10.3% in 2021. The companies in the Everest Group Engineering Services Top 50 collectively represented 86% of this market, accounting for more than US$55 billion of outsourced spending in 2021.
"Engineering services outsourcing bounced back strongly in 2021," said Akshat Vaid, vice president at Everest Group. "This can largely be attributed to an amalgamation of multiple factors, including a continued push towards digital engineering; revival of certain industry verticals, such as aerospace/defense and automotive; and investments into themes such as platform engineering, 5G, sustainability, metaverse, and COVID-led initiatives to optimize manufacturing operations with technology, among others. From the service provider perspective, the growth in ES outsourcing has added more fuel to the war for skilled, deployable talent with deep domain understanding, resulting in unmanageable attrition and increased talent costs. Service providers also continued to scale capabilities and delivery footprint through M&A endeavors, with more than half of the companies featured in the Top 50 list engaging in M&A."
Other highlights:
- The Top 5 ES companies based on revenue alone are Capgemini, HCL Technologies, Akkodis, Alten, and Cognizant.
- The Top 5 fastest growing ES companies were Globant, Encora, Persistent, EPAM and Alten.
- Europe continues to hold a major share (42%) of the providers in the Top 50 list, followed by Asia Pacific at 32% and North America at 24%.
- In 2021, more than 50% of the firms listed in the ES Top 50 report engaged in merger and acquisition activities. Providers continued to acquire companies to increase scale, boost capabilities and gain access to markets and talent. These activities have driven ES service providers' valuations to record highs.
- Broad-based providers' share of ES Top 50 revenue continues to increase at the expense of pure-play providers, as broad-based providers use growth in ES to offset the low headroom for growth in IT and business process services. Broad-based providers' share accelerated from 49% in 2020 to 67% in 2021.
The Everest Group Engineering Services Top 50 is based on both revenues and year-on-year growth. Revenues comprise 75% of the composite score used for ranking. Growth comprises 25% and has two sub-parameters: absolute growth (measured as change in ES revenue in US$ million and accounting for 12.5% of the composite score) and percentage growth (measured as percentage change in ES revenue and accounting for the final 12.5% of the composite score).
About Everest Group
Everest Group is a research firm focused on strategic IT, business services, engineering services, and sourcing. Our research also covers the technologies that power those processes and functions and the related talent trends and strategies. Our clients include leading global companies, service and technology providers, and investors. Clients use our services to guide their journeys to maximize operational and financial performance, transform experiences, and realize high-impact business outcomes. Details and in-depth content are available at http://www.everestgrp.com.
Media Contact
Andrea Riffle, Everest Group, +1 (954) 801-8474, [email protected]
Taylor Walker, Everest Group, 6145817938, [email protected]
SOURCE Everest Group
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