Our look at the biggest outsourced global service providers.

by FAOT Staff

Companies that outsource want confidence in their partners, and one mark of a trustworthy provider is size. Sure, there will be arguments about performance and execution too, but few qualities instill more confidence than having broad scope and significant financial size in a partner.

Size also translates into other sought-after characteristics as well. Often, it brings a global footprint, world-class practices, and lower costs to the party. Let’s also not forget about a track record—the largest usually have a steady history of growth.

However that’s not to say some of the small and medium-size FAO providers aren’t capable of servicing their clients. Like any market, there are quality and quantity shops; only you can determine which one suits your needs the best.

So when FAO Today set out to rank the largest players in the market, it seemed a straightforward task. Measuring them by FAO revenues, number of F&A transactions processed, number of clients served, or staff size should offer a fair snapshot of their position in the market place. Easier said than done.

The truth is that the providers listed here all occupy a unique stratum in the marketplace. Some are high-volume, execution machines that process billions of transactions a year for their clients. Typically leveraging their IT heritage, these global companies provide FAO through a business process outsourcing (BPO) unit, which itself might be a small portion of the overall business. They are massive in many ways, from the total value of transactions processed to the number of service centers they operate to the number of workers employed.

And then there are the niche players, those focused on a particular function or industry. Whether it’s financial services, the travel industry, or some other area, these providers have come to dominate their segment of the FAO universe. Few are more capable at it than these specialty shops.

So ranking them by any of the four criteria felt a bit like the ol’ apples-to-orange analogy. Besides, a buyer seeking a specific finance and accounting service may not find his needs can not be met by the higher-ranked providers.

To determine the players in our group, we sought out the expert opinions of market consultants and advisors as well as relied on our own expert knowledge of the market. The result is the following group of global providers—many of whom you are already familiar with through the pages of FAO Today.

Additionally, we called on Lisa Ross, CEO and founder of FAO Research, Inc. (www.faoresearch.com), to share her thoughts on the leading end-to-end FAO vendors (she limited her list to true, full-service providers). She addresses some of the market trends in addition to looking at the top companies.

We hope this gives you, the buyer, a sense of the biggest players in the industry. We can’t tell you if they fit your needs, but at least it’s a start.

THE TOP 20 FAO PROVIDERS

Accenture
accenture.com
One of the leaders in this space, Accenture offers industry-specific as well as cross-industry outsourced business process services through seven distinct units. Each unit offers standardized, best-in-class services leveraging proven assets and value-added processes within the company’s global center delivery network. Its finance solutions business focuses solely on finance and accounting services through a number of businesses and centers. The company helps clients develop the scope and standards of the services required, incorporating capability improvements and cost reductions using process improvements and standardized technologies. Services covered include business planning, reporting, and analytics services; general accounting services; treasury and cash management; customer billing and collection services; employee payment services; and vendor payment services. In addition, it offers finance center management services and applications support.

With a diverse client base, Accenture serves up a variety of outsourcing solutions. Recently, the company rolled out a new unified tax system (UTS) for the state of Nevada that enabled state employees and businesses to benefit from improvements in how taxes are managed, processed, and collected through UTS. The system increased efficiency for the Nevada Department of Taxation and allowed residents and businesses to file their taxes online. Other clients include Excel, Delphi, and BP.

ACS
acs-inc.com
With $5 billion in revenues, Affiliated Computer Services is one of the leading global FAO providers in the market as well as being one of the largest outsourced IT vendors. With presence in 100 countries and employing more than 55,000 workers, it focuses on manufacturing, retail, telecom, energy, financial services, consumer goods, transportation, education, healthcare, insurance, and government sectors.

Among the services ACS offers are accounts payable (processing and payment of business expenditures); accounts receivable (recording and tracking receivables from customers extending credit); billing (documenting and issuing invoices for goods or services); general accounting (general ledger maintenance and preparation of unit- and company-consolidated financial statements); tax management (researching, developing, communicating, and implementing tax planning strategies); and treasury and risk management (activities associated with securing funds to meet clients’ cash flow needs and the investment of excess funds).

Some recent key contract wins include a 3.5-year, $56-million BPO renewal deal with Aetna for document preparation, imaging, storage, management, and retrieval services for medical, dental, disability, and other types of claims; a three-year BPO agreement with KeyBank National Association; and a four-year contract with the state of Alaska to provide actuarial and consulting services to the State’s retirement and retiree medical plans.

Bisys
bisys.com
Not your typical F&A outsourced service provider, Bisys offers specialized services for specific industries but not high-volume, transactional services such as AP or AR. Its specialties include regulatory compliance reviews (broker-dealer, investment advisor, and investment companies); anti-money laundering reviews (broker-dealer and mutual funds); trading and market making surveillance (TMMS) reviews; regulatory mandates (broker-dealer and investment advisor); business analytics; report management; asset retention; and others. It works mainly within the insurance, investment fund, and banking sectors.

Services offered include check imaging, document imaging, imaged remittance processing, electronic cash letter, e-mail statements, account reconciliation processing, and automated signature/check stock verification.

Capgemini
capgemini.com
A major provider of BPO services including finance and accounting functions, Capgemini offers comprehensive FAO services throughout major markets in Asia, Europe and North America. The company announced a number of major contract wins recently, including in January a multi-year framework agreement to manage a range of finance and accounting processes in several countries for Zurich Financial Services (Zurich), one of the world’s largest insurance companies. Capgemini will provide a range of F&A services for the U.S., the U.K., Switzerland, and Germany from its dedicated BPO service center in Poland, which is staffed by 400 FTEs. With more than 3,500 people working in BPO and more than 1,800 in the strategic centers of Poland, China, and India, Capgemini, whose biggest component is finance and accounting, has developed a full range of expertise in business process outsourcing. Other BPO deals in 2005 included those with Bombardier, Telekurs, and Danfoss.

CGI
cgi.com
CGI, which claims to have BPO revenues of $1.35 billion, more than 1,000 clients, and processes more than two billion transactions, offers a wide array of financial services. It delivers through an international platform with shared-service centers located in Canada, France, and Mexico to cover multiple language capabilities and time zones (English, French, Spanish, German, Italian, Greek, Russian, and Portuguese). In addition, it has contract manufacturing accounting and analysis expertise and an established business process services model to cover various technologies and platforms for cost savings.

F&A services include cost and inventory accounting and analysis, general accounting and financial statements, pension accounting, bank and account reconciliations, local and global consolidations, contract manufacturing accounting and analysis, accounts payable, travel and expense management, accounts receivable, fixed assets management, and consulting services. It also incorporates ISO 9001 and CMM level 5 quality systems controls.

EDS
eds.com
Another heavy hitter among FAO providers, EDS offers a cornucopia of outsourced financial services including benefits administration, commercial card services, loan servicing, contact center, converged billing services, general accounting services, revenue cycle management, and others. With 42 years of experience, the company reaches clients in 60 countries. Also a leading global outsourced IT provider, the company is focused on the manufacturing, financial services, consumer industries and retail, and transportation sectors. EDS’ largest business is IT, but more recently, the company has been making a push outside its core through its joint venture with Towers Perrin—ExcellerateHRO.

Last year, the company landed a number of Medicaid management contracts with several states, including Massachusetts and Oregon. The deal calls for the provider to develop, design, and maintain an information management system for Medicaid patients. Last October, it also extended its relationship with Guthy-Renker in one of its biggest BPO contracts ever for services through 2010.

EXL Service
exlservice.com
New York City-based EXL Service specializes in banking, financial, and insurance industries and provides FAO services using more than 5,000 employees at four service-delivery systems in India. A provider of value-added, offshore BPO, the company offers broad-based expertise in integrated back-office process services and managing large-scale processes. It offers process mapping and documentation, process re-engineering, and business risk compliance services including Sarbanes-Oxley.

Its integrated global delivery platform includes four delivery centers based in Noida and Pune, India with a total capacity of 3,600 workstations per shift. Its finance and accounting services include expense reporting, account reconciliation, payroll and benefits, financial analysis, tax calculation, cash application and balancing, cash flow analysis, accounts payable, billing, accounts receivable, cash disbursement, and others.

Fiserv
fiserv.com
With a portfolio of more than 180 products and services and a client base of 13,000 financial institutions in more than 60 countries, Fiserv provides a full complement of outsourced F&A services and products. These include outsourced (service bureau) core processing systems, credit processing services, and value-added solutions for banks and thrifts; image processing for financial institutions, including services and technology for processing and automating paper-based payment transactions; account processing for credit unions; high-volume laser printing and mailing; electronic document distribution and archival; mortgage loan servicing; automated property valuation; loan and lease portfolio management for the auto finance market; loan settlement support; and contact-center services. For the insurance industry, it offers outsourced technology and services for self-funded medical, dental, vision, and disability plans, including health plan administration, care and disease management, and pharmacy benefit management.

Genpact
genpact.com
While new in name only, this former unit of General Electric has quickly transformed its business from one that used to support only its parent company to a world-class outsourced service provider. In finance and accounting services, Genpact (formerly called GE Capital International Services or GECIS) offers services in accounts payable, fixed assets accounting, record to report, general accounting reporting, accounts reconciliation, base-cost reporting, cash flow analysis, accounts receivables, treasury and tax services, cash disbursement cycle, treasury services, audit and projects services, taxation services, and others. The company has grown from 350 people in 1997 to more than 19,000 globally. Its major base of operation is out of India, and the company has sights on reaching $1 billion in revenues and 30,000 in headcount within two years. Last year it had revenues of $135 million.

While the number of external clients it has is small, they are nevertheless all major buyers of FAO. Names such as Penske, Creditek, Liberata, and others have all joined the Genpact portfolio. Although its biggest customer remains GE, Genpact has signed on some major customers recently, including an unorthodox contract with Wachovia, which did not decide on what to outsource at the time of the signing. Instead, the bank struck a deal to outsource undetermined F&A functions to a Genpact service center within the seven years of the contract.

Hewlett-Packard
hp.com
With clients such as Procter & Gamble and other international giants, HP has developed a worldwide footprint in its BPO expertise. With delivery centers in India, China, Singapore, Mexico, Costa Rica, and Spain, plus local operations in more than 50 countries, the company has more than 1,000 clients in the BPO segment.

The company began this business in 1990 by consolidating more than 500 processes into a regional and global services operation by 1996. Now employing a staff of 4,000, the company delivers end-to-end business services including accounts payable, accounts receivable, time and expense administration, fixed asset management, general ledger accounting, project accounting, and reporting. Last year it announced a greater push in Eastern Europe by announcing plans to invest $50 million over the next five years on a new BPO service center in Poland. The center is expected to help drive commerce to Poland, expand HP’s growing BPO business globally, and enable the company to offer local financial and accounting services to multinational companies that have pan-European operations, according to HP.

IBM
ibm.com
Big Blue is also becoming Big Green in the areas of FAO, according to analysts. A recent report released by IDC said the company is one of the leaders in the BPO market because of its global footprint, and its IBM Daksh subsidiary has quickly become one of the biggest BPO providers in India with 6,000 workers performing a variety of back-office services.

Among the services IBM offers are claims registration, adjudication and processing, application processing, order fulfillment, information verification and confirmation, payroll processing, research, analysis, account maintenance and changes, correspondence management, and data conversion. In addition, the company through IBM offers BTO consulting services for finance and accounting clients.

The company’s Indian subsidiary was launched just four years ago but has quickly gained momentum in the marketplace. It operates five delivery centers in India and recently added a disaster recovery center in the Philippines.

Nipuna Services Ltd.
nipunaservices.com
A subsidiary of Satyam, Nipuna provides F&A services from three locations in India. Within its BPO business, Nipuna offers the following finance and accounting services: accounts payable, accounts receivable, general ledger maintenance, financial accounting, fixed assets, and invoicing. Its focus is specifically on insurance, healthcare, and pharmaceuticals; banking and financial services; manufacturing, automotive, energy, and power; telecom/media; and travel, tourism, and retail.

By leveraging its parent company’s global IT presence, the company has been able to build on long-term relationships with top financial services organizations. It offers clients comprehensive, scalable process management solutions for managing entire finance and accounting departments, as well as performs financial transaction processing. Last year it opened a new service center in Chennai, India. In addition to FAO, the company also has HRO offerings.

OPI
opiglobal.com
Claiming itself to be the largest BPO-only service provider, Outsource Partners International earlier this year reached a milestone in the company’s history: expanding its workforce to 1,000 worldwide. CEO Clarence Schmitz said the development is indicative of the market’s confidence in the company. With seven offices in the U.S. and India, OPI offers a broad range of services to companies with revenues of $25 million to more than $15 billion.

These services include routine, recurring transactions as well as complex processes up to and including regulatory compliance, preparation of financial statements, and SEC reporting. From accounts payable to general ledger accounting, bank reconciliations, and tax co-sourcing, OPI also aids companies with Sarbanes-Oxley compliance program documenting, testing, and re-engineering finance and accounting process.

OPI was established in 2002 following the merger of KPMG’s national finance and accounting BPO practice with itAccounts, a New York-based accounting firm with an ISO 9001:2000-certified shared-service center in Bangalore, India. Last year it further expanded its presence in India with the opening of a 137,00-square-foot center in Kochi, India.

Perot Systems
perotsystems.com
With 17,000 employees and $1.8 billion in revenues, the company, founded by former presidential candidate Ross Perot, derives less than 10 percent of its revenues from outsourced finance and accounting business. Nevertheless, it is still a sizable player in the market providing end-to-end F&A services.

To grow its presence in the market, the company has been investing in both on-shore data-capture centers (using scanning and imaging technology) and offshore business-processing centers (employing best-practice workflow management tools, back-end resource management monitoring tools, and secure client portals that give businesses a clear look and deeper insight into their transactions). Services include credit analysis, billing, cash application, collections, general ledger posting and reporting, vendor management, invoice processing, problem resolution, payment processing, and time and expense processing. It specializes in the healthcare, government, commercial, financial services, and insurance sectors.

Progeon
progeon.com
The BPO business subsidiary of Infosys, Progeon offers clients the low-cost benefits of offshore F&A services through its service centers in Bangalore and Pune in India and Brno in the Czech Republic. Since launching in 2002, the company has grown quickly in the FAO market and now employs about 5,700 workers in Asia and Europe.

Like many other end-to-end providers, Progeon, headquartered in India, also offers a broad range of services, including accounts payable and accounts receivable, fixed asset management, record to report, general ledger accounting, ledger reconciliations, financial analysis and management, tax compliance and planning, and others. Its Czech facility, opened in 2004, expanded the company’s reach into the European market by offering service in 11 languages. Recently, Progeon signed a BPO contract with computer distributor Ingram Micro for $10 million a year.

It processes about seven million transactions annually through 700 employees and posted about $75 million in FAO revenues in the past 12 months. This segment accounts for about 18 percent of total BPO sales.

SourceNet Solutions
sourcenetsolutions.com
SourceNet, a Mellon Financial subsidiary, delivers BPO services starting from the sales cycle to implementation and beyond. After being acquired by Mellon in 2004, SourceNet has since expanded the business to include a wide range of offerings. Among the BPO services are accounts receivable, customer refund processing, document management, procurement and travel card program administration, travel and expense reporting, accounts payable management, utility bill management, payroll management, tax administration, and others. Among its clients are Cingular (formerly AT&T Wireless), Doane Pet Care, and Cemex.

Tata Consultancy Services
tcs.com
A part of the Tata Group, TCS provides both IT and BPO services to its clients. With more than $2 billion in annual revenues, the company has a history spanning nearly four decades. During that time, it has expanded into 34 countries and a diverse range of industries. F&A services, however, remains a small portion of its overall revenue base.

Recently the company acquired a BPO company in Chile for $23 million, expanding its presence in the South American market and giving it a leadership business in the check-processing sector in Chile. Last October, it launched a new life and pension business after reaching a deal to establish a subsidiary to service the Pearl Group. The $847 million deal for over 12 years calls for the new company to provide BPO for life and pension businesses, starting with Pearl Group’s closed-books portfolio.

Using more than 400 employees, it processes about five million FAO transactions annually.

Wipro
wipro.com
With revenues of around $1.5 billion in its last fiscal year, the IT and BPO giant employs 42,000 in 23 countries. FAO was just one of the myriad businesses that contributed to its overall sales. The Chennai, India-based company operates a number of offices in Europe, the U.S., and Asia.

Among the finance and accounting services offered by Wipro are credit management, invoicing, collections, reconciliations, fixed assets accounting, project accounting, purchase order validation, accounts payables, Sarbanes-Oxley reporting and dash- boards, U.S. GAAP compliance, VAT claims, and more. In addition to F&A transaction processing, Wipro also offers ancilliary services such as data cleansing, data management support, data analytics and reporting for finance and accounts function.

Recently, it expanded its presence in the payments market by acquiring mPower, a U.S. company with an offshore Chennai-based facility, for $28 million. mPower, a niche company focused on the payment space, has annualized revenues of around $18 million and an annualized EBIT of around $4.6 million. Wipro Technologies also entered into a strategic engagement with MasterCard International, by acquiring 100 percent stake in MPACT, a joint venture of MasterCard and mPower.

Last year Wipro signed a contract with E-OPS of Miami to handle its loan processing, including application data entry and submission; the follow-up process; query handling; and the re-submission, closing, and notification. It was the nation’s first offshore around-the-clock mortgage-processing service.

WNS
wnsgs.com
WNS is one of the largest outsourced mortgage service providers , with more than 40 processes delivered in the mortgage lifecycle and more than 25 million document pages processed each quarter. Services offered by WNS include loan processing, risk management, document indexing, underwriting, loan servicing, investor loan delivery, loan closing and post-closing services, customer service, collections, retail and commercial banking operations, investment banking operations, capital markets operations, and asset management services. WNS processes about 54 million transactions annually for 25 FAO clients.

Xansa
xansa.com
With BT one of its clients, Xansa is a U.K.-and India-based provider with more than 13,000 F&A employees serving clients in the banking, insurance, public sector, retail, telecoms, and utilities industries. Last year, it had sales of approximately $130 million in FAO. It processes 250 million accounting entries annually.

With service delivery from India, the company offers BPO as well as ITO to clients from around the world. The company has been providing finance and accounting shared services since 2002 with end-to-end capability. Back-office business processes are handled from seven main locations in the U.K. and three in India. In 2005, Xansa won the National Outsourcing Association “BPO Project of the Year” award for its work with client MyTravel.

Some of the services it offers include card processing, mortgage processing, consumer finance application processing, general accounting, arrears management/collections, and others.

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