The 2016 CRM Market Leaders: Consultancies

THE MARKET

As much of the enterprise software market moves to the cloud, CRM consulting firms and systems integrators are being challenged to adapt their business models to this increasingly cloud-focused world. As a result, a number of the top service providers have acquired pretty sizable Salesforce.com partners to expand their cloud services. Capgemini, for example, purchased Oinio, a German Salesforce.com partner, to expand its cloud services in Europe and Asia, while Accenture invested heavily in Vlocity and acquired CRMWaypoint and Cloud Sherpas.

But while many systems integrators soar into the cloud market through strategic acquisitions, Nucleus Research also expects them to see “relatively flat revenue growth” this year. This will occur amid a growing demand for CRM solutions that deliver faster time to value by limiting the amount of customization and ongoing support needed, which has traditionally been a key element of system integrators’ business. That, the firm says, will make acquisitions “an obvious strategy to maintain revenue, at least in the short term.” The question is how sustainable that strategy will be in the long term.

THE LEADERS

Last year’s category winner, Appirio, this year finishes as an industry leader. Its scores of 4.0 in ability to execute and customer satisfaction and 3.9 in cost were among the best in the industry. “Appirio has built a good reputation in the market as a cloud systems integrator,” says Ray Wang, founder and principal analyst at Constellation Research. “Clients continue to love them despite capacity restraints.”

French firm Capgemini, a perennial favorite among analysts, pulled down scores of 3.7 in ability to execute, customer satisfaction, and company direction. “Capgemini’s strong focus on innovation distinguishes it from competitors,” Wang says. As part of that innovation, the company placed an added focus on its cloud capabilities, mostly through organic growth, but also through the Oinio acquisition. Additionally, its $4 billion acquisition of IGATE in mid-2015 paved the way for the largely Europe-focused company to strengthen its presence in the lucrative North American market.

Ernst & Young can still be described as the new kid on the CRM consulting block, but its position can’t be denied. The firm, which made its debut on the leaderboard last year, scored an industry-leading 4.0 in company direction this year. “E&Y has made significant investment and inroads in the customer advisory practice area in the last few years, bringing it up to par with consultancies that have been in this space longer,” says Leslie Ament, senior vice president and principal analyst at Hypatia Research Group.

With its acquisition of Bluewolf earlier this year, IBM Global Business Services took an already solid business and elevated it to the next level. That deal “puts IBM clearly in the cloud systems integration space with a strong Salesforce.com practice,” says Rebecca Wettemann, vice president of Nucleus Research. IBM also rode an industry-leading score of 4.2 in ability to execute and a 3.9 in company direction to the leaderboard this year. “Cross-pollination between IBM’s ExperienceOne design-thinking approach and Global Business Services is a significant change in how it works with clients, and a highly positive one at that,” Ament says.

THE WINNER

After faltering a bit last year, Hitachi Consulting finds itself back as the category winner with very solid numbers in ability to execute (4.0), cost (3.8), and company direction (3.8). The company spent a lot of time and resources this year building its cloud capabilities. It has always been strong with Microsoft Dynamics CRM implementations, but this year it also strengthened its relationships with Oracle and SAP, among other system vendors. “Hitachi has built a trusted reputation in the market for quality and on-time delivery,” Wang says. 

One to Watch

Deloitte, which bounces on and off the leaderboard from year to year, this year finishes as a One to Watch based on its 3.9 score in ability to execute and a respectable 3.7 score in company direction. “Their approach to hiring consultants who are triple threats—with industry, domain, and functional expertise—is valued by their clients,” Ament says.

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