Bengaluru: Zinnov Management Consulting, a leading globalization advisory firm, today launched its much awaited Rating of Global R&D Service Providers' across various geographies like India, China, Russia and Eastern Europe. The study titled "Global R&D Service Providers (GSPR) Rating 2011", is an annual study undertaken by Zinnov to assist business leaders in spearheading global engineering initiatives and in order to facilitate them in identifying the right partners across geographies.
• Wipro emerges as the top ranked company overall; followed by HCL, Patni, Infosys, Mahindra Satyam and MindTree
• While Wipro proves to be a leader in the overall rating, HCL, L&T IES, Symphony Services, Tata Elxsi, Aricent & Patni establish themselves as leaders in specific industry verticals
• R&D Offshoring Growth to India to reach USD 13.1 Billion by 2011 (E) at a growth of 11.4 % from
According to the Study, Wipro has emerged as a clear leader in the overall rating with HCL, Patni, Infosys, Mahindra Satyam and MindTree following them. The top six players constitute 58% of the total R&D service provider market, the study highlights. All 44 participating companies have been assessed on parameters like Human capital, capabilities, financials, ecosystem linkages, infrastructure & business sustainability. While Wipro proves to be a leader in the overall rating, HCL, L&T IES, Symphony Services, Tata Elxsi, Aricent and Patni establish themselves as leaders in specific industry verticals. The study, furthermore highlights that the last 18 months have seen emergence of certain macro themes that are driving growth in the R&D service providers community, that primarily consist of a) convergence & mobility, b) emerging markets, c) cloud computing, d) enterprise adoption and e) green initiatives.
Commenting on the study, Pari Natarajan, Co-Founder & CEO, Zinnov Management Consulting said, ""To assist business leaders in spearheading global engineering initiatives, we at Zinnov, have released this much awaited one-of-its-kind Global R&D Service Providers' Rating, a comprehensive rating and analysis for the top R&D Service Providers in India, China, Russia and Eastern Europe. R&D services outsourcing today has indeed evolved from tactical work segregation to a shared product vision between in-house and service provider teams. Our study also highlights that service providers are now more open to trying out newer business models in the wake of increased competition and the need to differentiate."
The study also brings to light that of all the R&D outsourcing work in India, two-thirds of it is towards MNC Captive Centers while one-third is to the R&D Service Providers. The focus on conceptualization and design has increased in mature outsourcing verticals such as software while it has remained concentrated on development and Q&A in newer verticals.
The study goes on to highlight that service providers are building deep expertise through centers of excellence in specific areas in order to contribute further up the PDLC value chain. Some cases in point are Mahindra Satyam's CoE for Aero Structures, Persistent system's partnership with Indiana University for Bio-informatics, Tata Exlsi and Wipro partnership with AUTOSAR for its Automotive capabilities, Defiance alliance with University of Michigan for development of Solar powered automobiles, etc.
The study reads that organizations in most verticals, continued to spend nearly the same percentage of their revenues on R&D through recession, demonstrating the strategic importance of R&D. Almost all verticals exhibited a decrease in absolute R&D investments compared to previous year (during recession) with Automotive and Semiconductors showing the maximum percentage decrease. However, the Automotive vertical continues to remain the largest spender of R&D. The study provides interesting vertical insights and goes on to show that Telecom and Software contribute more than 50 percent of the overall R&D offshoring market to Service providers in India. However, the emergence of new growing verticals like industrial automation, healthcare, aerospace& defense and transport bodes well for the industry. Zinnov projects that the next set of growth for India R&D service providers will come from these growth verticals.
Elaborating on the study, Chaitanya Ramalingegowda, Director-Advisory Services, Zinnov Management Consulting said, "With companies outsourcing more and more of their R&D activities, the year 2009-2010 did witness the relief post-recession effect. We expect growth to be strong in the Software / ISV vertical as offshoring is fairly mature in the augment. We also anticipate that consumer electronics and industrial automation will pick up momentum in the coming years."
With the release of the study this year, Zinnov also introduces the first-ever framework for assessment and relative comparison of R&D service providers. The framework called 'Zinnov Zones' present a unique perspective on the capabilities of service providers as potential partners for global engineering customers. 'Zinnov Zones' provide a dashboard view of the stage of evolution of product engineering services practice at a vertical / overall level. The framework allows one to access a company basis of its presence in Nuture / Breakout / Execution / Leadership category.
While comparing geographies, the study reads that Europe has been slow while US continues to lead R&D outsourcing. The pressures of recession have seen the R&D services outsourcing to emerging locations increase with India becoming the most sought after destination followed by China. India scores well on the availability of highly talented workforce and cost savings while China benefits from the domestic market attractiveness. The study also shows the emergence of other locations on the basis of specific strengths like Taiwan (computing systems), Ireland (medical devices), Poland and Brazil (construction/heavy machinery).
About Zinnov Management Consulting
Founded in 2002, Zinnov – meaning Zeal in Innovation – is a leading management consulting company providing advisory services in the area of Global Sourcing, Emerging Markets Expansion and Human Capital Optimization to Fortune 1000 and reputed SMB companies. Zinnov works collectively with clients to tackle prevailing organizational challenges by analyzing the changing dynamics, improving performance, and building institutional capability. The services delivered to its clients through advanced reasoning and analytical techniques, provides solutions that help in integrating organizational vision, business definition and processes.
For more information contact:
Kinjal Chhetri Panwar
Marketing Manager, Zinnov
Email: kinjal ( @ ) zinnov dot com
Phone: +91 9466132313