The Magic Quadrant for CRM Service Providers, Europe analyzes the market for CRM consulting and solution implementation services. The relative positioning of vendors in this Magic Quadrant is based on the inclusion criteria and key criteria for evaluating their ability to execute and completeness of vision, as laid out in this document. Consulting and system integration projects require a blend of skills in business, industry, technology, and project and program management that must align with your objectives, institutional and business culture, and employees. Use this Magic Quadrant to understand the market and relative positioning of the best consultants and system integrators for pan-European CRM projects. Gartner advises enterprises to avoid simply selecting firms from the Leaders quadrant. All CRM projects are different, and the service provider with the best fit will be buyer-specific. Service providers in the Challengers, Visionaries or Niche Players quadrants may be a better match for your requirements. Many smaller service providers not covered in this Magic Quadrant may be appropriate for your needs on smaller or country-specific projects.

In 2009, the European market for CRM consulting and system integration services experienced a contraction of 6%, after growing 11% in 2008. Growth among all CRM consulting and system integrators was inconsistent, marked by wide variances from approximately -25% worst case to +30% best case. The external service providers (ESPs) on this Magic Quadrant did not reach these extremes, but, in line with the broader market, half grew their revenue in 2009, and half contracted.

The year 2009 was marked by a dire 1H09 carrying on from the drop in 2H08, with the low point being in February or March 2009 for most CRM practices. This was followed by a stabilization in 2H09, where redundancies ceased, utilization rates improved and CRM practice management teams became optimistic from October onward. It was not until late January 2010 that the consensus view for Europe was that utilization rates had returned to the high levels before the global recession (in many cases, 80% or more),and that recruitment had become a primary challenge again.

New large-scale CRM projects in 2009 dried up and have only started to return in 2010, with a small number of €100 million projects appearing. Those lucky enough to have multiyear, large-scale CRM projects through the downturn outperformed those without. The majority of new projects were smaller and more departmental, with e-marketing, e-mail marketing, e-commerce, e-service, outsourcing and analytics projects seeing a boost. Similarly, pure consulting or process redesign projects were less common. Those with the ability to use a global delivery model to offer lower-than-average blended fee rates were able to weather the storm better than those that were not able to do so. Once again, the offshore, pure-play service providers Gartner analyzed grew at rates exceeding the market average, although they slowed to a rate of one-half or even one-third that of the good times.

In 2010, CRM service provider management teams are cautiously optimistic. Europe is the poorest performing region in the world, with Central and Eastern Europe containing the worst specific countries. Fears of a "double-dip" recession have re-emerged in 2Q10, which is choking off the desire to commission new, big CRM initiatives. The result is that 2010 is set to be a rocky market for CRM service providers, and growth will be limited to 5%, with the best growing at 20% and the worst seeing a further single-digit decline in revenue. Nonetheless, demand for the new areas of CRM is rising rapidly. In particular, there is high interest and signs of early adoption in Europe for social CRM, the next generation of digital marketing, more interest in predictive analytics and pricing optimization, and a particularly high interest in both business-to-business (B2B) and business-to-consumer (B2C) mobile CRM. Clearly, the market remains highly competitive, and new entrants can be expected in the next few years (see Note 1).

This Magic Quadrant focuses on pan-European CRM consulting and solution implementation services. Consulting and solution implementation services include CRM strategy, business consulting, business transformation, development, configuration, and deployment and training on packaged and custom CRM software. This research focuses on suppliers' CRM practices (see Note 2) that Gartner has found frequently used by the 1,000 largest organizations in Europe for pan-European projects and programs.

To further illustrate this market, consider the following definitions:

Consulting and solution implementation — Consulting services are advisory services designed to help companies analyze and improve the effectiveness of business operations and technology strategies. For this Magic Quadrant for project-based CRM service delivery, solution implementation services focus on packaged application development, integration and deployment services.

CRM — Gartner defines CRM as a business strategy in which the outcomes optimize profitability, revenue and customer satisfaction by organizing around customer segments, fostering customer-satisfying behaviors and implementing customer-centered processes. This research focuses on the following primary solution areas of CRM:

• Sales — Solutions that support field sales, telesales, retail sales, Web sales and technology-enabled buying

• Marketing — Solutions that support marketing analysis, campaign management and marketing process automation

• Customer service and support (CSS) — Solutions that support customer service and support processes

• Topography — For a full description of Gartner's view of the topography of CRM applications, see "The Elusive CRM Magic Quadrant" and "Toolkit: CRM Industry Heat Map, 2010."

Business value of IT — To find the strongest arguments in support of an IT initiative, it is necessary to break out financial and operational performance metrics into categories that can be more clearly monitored and managed. The guiding principle is: "The business value of IT is always, always, always measured in improved business performance."

Gartner's Magic Quadrant research process involves primary research with direct client references supplied by CRM service providers, and each service provider's representation of its organization. The analysis involves weighting both sources of information, with a heavy emphasis on client feedback. As a result, many of the individual categories have "client reference" criteria factored into the scoring. Gartner considers client feedback to be one of the most critical measures of a service provider's success.

Gartner evaluates service providers on their ability to execute and their completeness of vision. When the two sets of criteria are evaluated together, the resulting analysis provides a view of how well the provider performs a spectrum of services, compared with its peers, and how well it is positioned for the future. This evaluation is a snapshot in time. The competitive nature of the CRM service provider market over time affects the relative position of evaluated companies. In addition to understanding positions in this Magic Quadrant, enterprises must conduct due diligence and check references. Ensure that your business culture is synergistic or, at a minimum, compatible with the service provider's culture. The most critical criteria for a project's success are a provider's ability to work within an enterprise's business culture, and a provider's ability to work with an enterprise's people to affect the organizational change essential for a successful CRM program.

A broad group of providers offer CRM services. Magic Quadrants do not include all vendors in a given sector. Many service providers only focus on parts of the overall solution. Companies considered for evaluation in this Magic Quadrant are those that act as advisors and provide implementation services that encompass most or all levels of a solution, as outlined above. Furthermore, providers will also be evaluated in more detail using a combination of quantitative and qualitative criteria. Note that vendors cannot elect to be excluded from a Magic Quadrant, assuming they meet the inclusion criteria.

Quantitative Criteria for This Magic Quadrant:

• Service providers that demonstrate CRM consulting and solution implementation service revenue derived from clients in Europe.

• A minimum of $50 million (in U.S. dollars, estimated for 2009) in enterprisewide CRM service revenue (excluding value-added reseller [VAR] revenue, outsourcing, managed service revenue, and software maintenance and support fees) for projects based in Europe.

• Evidence of operations and a direct presence for delivering project-based CRM services in five countries in Europe.

Qualitative Criteria for This Magic Quadrant:

• Gartner analysts' interactions with enterprises, which reveal interest in specific CRM service providers.

• Vendor demonstrates depth and breadth of CRM service capabilities.

• The service provider's current and potential market impact as measured by frequency of appearance on shortlists.

• Ability to provide consulting and solution implementation services (including program and project management) across multiple CRM software platforms (such as from Oracle, SAP, salesforce.com, Microsoft, etc.).

Patni Computer Systems

NTT Data Europe

Logica was removed because it is not focused on pan-European CRM projects, and CRM is not one of the company's strategic high-growth areas. However, it provides CRM services in multiple countries and continues to invest in CRM as part of its vertical solutions, such as customer care in telecom and citizen-centric services in the public sector.

BT Global Services was removed because its focus is on managed services and implementations of contact center infrastructure such as Genesys, Avaya and Cisco, rather than CRM software applications like Siebel, SAP, Microsoft and salesforce.com. BT is not competing for the same business as others on this Magic Quadrant, as evidenced by its nonappearance as a competitor on shortlists of other providers' references.

Our assessment of a vendor's ability to execute consisted of the following criteria (see Table 1):

Product/Service — Core services offered by the provider that compete in/serve the CRM services market. This includes current service offerings, as defined in the market definition and expressed by growth, capacity, market penetration, skills availability, breadth and depth of offering. Subcategories include:

• Assessment of services in key CRM business skills for sales, marketing and CSS

• Analysis of technical knowledge and skills

• Assessment of provider's ability to develop services to meet emerging market needs

Overall Viability (Business Unit, Financial, Strategy, Organization) — Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood of the individual business unit to continue to invest in the service, continue offering the service and advance the state of the art within the organization's portfolio of services.

Sales Execution/Pricing — The technology provider's capabilities in all presales activities and the structure that supports them. This includes deal management, pricing and negotiation, pre-sales support and the overall effectiveness of the sales channel.

Market Responsiveness and Track Record — Ability to respond and adapt to changing competitive forces as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the provider's history of responsiveness, and the ability to quickly address changing requirements.

Customer Experience — This criterion considers the provider's:

• Specific client feedback on their experience working with CRM ESPs

• Demonstrated ability to deliver on key metrics that drive the overall client experience when working with a CRM ESP

Operations — The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure, including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis. Subcategories include:

• Organizational and business model

• Applied use of methodologies

• Global delivery model capabilities

Our assessment of a vendor's completeness of vision consisted of the following criteria (see Table 2):

Market Understanding — Ability of the provider to understand buyers' needs and translate these needs into products and services. Vendors that show the highest degree of vision listen to and understand buyers' wants and needs, and can shape or enhance those wants and needs with their added vision. Subcategories include:

• Service provider's knowledge and articulation of key market direction and trends

• The analysis of the service provider's executive leadership (including thought leadership, continuity, operational capabilities, etc.)

Marketing Strategy — A clear CRM services marketing strategy with a differentiated set of messages consistently communicated throughout the organization and externalized through appropriate channels, emphasizing differentiated positioning statements.

Sales Strategy — The strategy for selling CRM services that uses the appropriate network of direct and indirect sales, partner networking and alliance relationships that extend market reach to both prospects and the customer base.

Offering (Product) Strategy — A technology provider's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature set as they map to current and future requirements. Subcategories include:

• Service provider's strategies for partnerships and alliances

• Vision for creating new and/or additional CRM business

Vertical/Industry Strategy — The technology provider's strategy to direct resources, skills, and offerings to meet the specific needs of individual market segments, including verticals.

Innovation — Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, or defensive or pre-emptive purposes. Subcategories include:

• Approach to customer experience design and development

• Sustainable investment in proactive tools, methods and/or locations for CRM solution development

Geographic Strategy — The service provider's strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the "home" or native geography, either directly or through partners, channels and subsidiaries, as appropriate for that geography and market. In this Magic Quadrant, we are looking for the ability to deliver on pan-European programs and projects.

Leaders are performing well, gaining traction and "mind share" in the market. They have a clear vision of market direction and are actively building competencies to sustain their leadership position in the market.

Challengers execute well for the portfolio of work selected, but they have a less-defined view of market direction. Consequently, these service providers may be the "up and comers" of the future, or they may not be aggressive and proactive enough in preparing for the future.

Visionaries articulate important market trends and direction. However, they may not be in a position to fully deliver and consistently execute. They may need to improve their optimization of service delivery.

Niche players focus on a particular segment of the market, as defined by such characteristics as functional area (that is, sales, marketing or service), vertical industry, client size or project complexity. Their ability to execute is limited to those focus areas and, therefore, is assessed accordingly. Their ability to innovate may be affected by this narrow focus.

Accenture continues as a leader in the 2010 Magic Quadrant because its renewed vision for CRM is impressive and its customer satisfaction scores were, again, strong.

• Countries: Most of Accenture's projects and local CRM resources are in the U.K., France, Italy, Germany and Spain, and the company is well-coordinated for pan-European projects.

• Industries: Accenture's largest CRM resource skills and project experience is in telecommunications, utilities, banking and insurance services, consumer goods and high-technology manufacturing.

• Vision: Accenture has rejuvenated its vision for CRM in the last 18 months with the creation of Accenture Interactive, and its focus on digital marketing and customer analytics.

• Customer satisfaction: The company has an above-average score for satisfaction in Gartner European-client reference checks (particularly for the team members on the project), project management skills and user change management skills.

• Price: According to Gartner reference checks, the most common reason Accenture loses competitive bids (for the sixth year running) is because of the price of its services.

• Revenue decline: Accenture's EMEA consulting revenue contracted in 2009. According to Gartner estimates, the CRM practice also contracted — it had the weakest financial performance of the four market leaders, and at a greater rate of decline than the market rate. However, Accenture remains one of the largest vendors by revenue in the market.

BearingPoint remains a visionary in the 2010 Magic Quadrant because of the negative impact on revenue due to the uncertainty caused by the break-up and management buy-out of the firm in 2009, despite the strong leadership and vision of the company. BearingPoint has overall CRM revenue approximately one-third the size of leading CRM service providers in Europe, but its consulting revenue is approximately 60% the size of the leaders.

• Countries: BearingPoint's CRM resource depth and projects are mostly located in France and Germany, followed by the U.K., the Netherlands, Norway and Sweden.

• Industries: The largest proportion of BearingPoint's CRM resource skills and project experience in 2009 was in utilities, telecommunications and banking/insurance, followed by retail and discrete manufacturing.

• Vision: The company's vision for CRM and customer experience has strengthened for the third year in a row, as demonstrated by its work on its research, point of view publications, key principles handbook, digital identity, "mobiquity," social marketing and digital customer strategy. The proportion of revenue from consulting work continues to be greater than implementation work, and this remains the highest ratio of consulting of the CRM providers in this study.

• Revenue decline: Gartner estimates that BearingPoint had the largest revenue decline in 2009 of the vendors on this Magic Quadrant. This was based on several factors, including the combination of recessionary economies and the uncertainty for buyers around the separation of the European firm from the U.S. organization in 3Q09. Financial recovery in 1H10 has been good, but we wait to see if it is sustained.

• Geographical coverage: BearingPoint has a limited presence in many smaller European countries for CRM, such as in Austria, Finland, Denmark, Italy and most parts of Central Europe). BearingPoint has begun to mitigate this challenge by recruiting aggressively and putting together partnerships with other local CRM consultancies in Italy, Spain, Argentina, Brazil and the U.S., and by expanding in Mediterranean countries such as Morocco and Greece.

• Global delivery: BearingPoint uses some offshore resources for most of its pure system integration projects, but this contributes to less than 30% of its sales revenue in Europe. Reference customers said 82% of work was done on-site, a further 11% done off-site, 5% offshore and 2% nearshore. The company does not have the same ability as its nearest competitors to scale as a system integrator, but has signed a partnership agreement with Tata Consultancy Services in the last 12 months that is winning new business and beginning to reduce this caution.

Business & Decision remains a niche player in this Magic Quadrant because of its relatively poor customer satisfaction scores, lack of growth and limited global delivery model. However, the vendor remained on the Magic Quadrant, unlike others, and its customer analytics abilities continue to shine. Business & Decision is one-fifth the size of leading CRM service providers in Europe.

• Countries: Most of Business & Decision's work is in France and Belgium, with a growing presence in Switzerland, the U.K. and Spain, and a differentiating presence in North Africa.

• Industries: The greatest proportion of European CRM resource skills and project experience in 2000 was in telecommunications and media, insurance and banking.

• Analytics: Business & Decision, as a firm, generates more than 60% of overall revenue from business intelligence. Consequently, its CRM practice has strong analytical CRM skills in cooperation with the larger business intelligence practice.

• Customer satisfaction: Unlike in 2009, Business & Decision customer references in Gartner European-client reference checks gave the company the lowest aggregate score for satisfaction, likelihood of rehire and willingness to recommend.

• Growth: Business & Decision declined in CRM revenue more than the market average. Gartner believes this was primarily due to the lack of offshore resources to enable it to offer lower blended rates in the face of the economic recession in 2008/2009.

• Global delivery: Business & Decision has small numbers of offshore resources in India, Tunisia, Romania and Mauritius. The company uses nearshore or off-site centers, but it still lags behind competitors in its ability to use offshore resources to deliver CRM services. Customer references said that 74% of work was done on-site (the highest of any provider), 17% off-site and 9% nearshore.

• Geographic coverage: The company remains relatively weak in Germany, Scandinavia, Italy and Central Europe, as compared with market leaders, which limits its ability to consistently deliver on pan-European projects.

Capgemini improved as a leader in the European CRM service providers Magic Quadrant due to having the strongest growth rate among participating providers in this study (and, possibly, the whole market), its continued improvement in CRM vision in Europe and the development of new offerings in areas such as channel management and social CRM.

• Growth: Capgemini was the fastest-growing CRM service provider in Europe in 2009.

• Countries: Capgemini's CRM resources and projects are strongest in France and the U.K., then Germany, the Netherlands, Sweden and Spain — the company is growing fastest in Sweden, Norway and Finland .

• Industries: The largest proportion of Capgemini's CRM resource skills and project experience in 2009 was in the public sector (U.K. and France), banking and insurance, telecommunications, discrete manufacturing (particularly in Germany) and retail.

• Global delivery: Capgemini competes in the U.K. and the Netherlands directly, with offshore vendors using its global delivery capabilities, but uses local delivery almost exclusively in France and Germany. Reference customers said 69% of CRM project work was done on-site, 18% off-site, 10% offshore and 3% nearshore.

• Resource quality variability: According to Gartner reference checks, Capgemini most often loses competitive CRM service bids in Europe because of the quality of team members proposed for the project, the price being too high and, in some cases, an inability to demonstrate an understanding of the client's business problem.

• Limited Geographic spread: Capgemini's CRM practice does more than 75% of its work in the U.S., France and the U.K., with a big drop down in the percentage of work it does in Germany and other countries. This concentration is higher than the other leaders and means that smaller countries have fewer resources than comparable competitors.

Cognizant has become a challenger because, despite having the slowest growth of the offshore providers on this Magic Quadrant, its vision has improved significantly in 2010, and its customer satisfaction scores were excellent. Cognizant's revenue remains one-seventh the size of the leading CRM service providers in Europe.

• Industries: The greatest portion of the company's European CRM resources, skills and project experience in 2009 was in pharmaceuticals, insurance and banking, then consumer goods.

• Vision: Cognizant has had a strong focus on master data management, customer analytics and business process management (BPM) flavors of CRM for several years, but has added a focus on social CRM and a willingness to invest in the fringe areas of CRM for the long term.

• Global delivery: Cognizant makes strong use of offshore capabilities in India. The offshore capabilities are used for all implementation projects. Reference customers said that Cognizant delivers 60% of the workload via offshoring and 40% on-site.

• Customer satisfaction: Reference customers scored customer satisfaction, likelihood to rehire and willingness to recommend high. In aggregate across these three metrics, Cognizant customer references scored the company second-highest of the vendors evaluated.

• Geographic coverage: Cognizant continues to have few resources outside the U.K. and Switzerland. Although it has local CRM resources in six other European countries, the company is still relatively weak in France, Germany, Spain, Italy, Belgium, the Netherlands and Scandinavia, as compared with market leaders and other offshore providers.

• Business consulting: Cognizant estimates that its revenue mix was 10% for consulting work versus 90% for integration, deployment and other implementation work in Europe in 2009. Customer reference checks confirmed this ratio. Cognizant needs to expand the business consulting work it does on projects to challenge the market leaders.

• Experience of resources: Cognizant reference customers had some specific areas that they rated low: the cultural fit of consultants, the lack of Cognizant influence on senior management and expertise in marketing.

CSC remains a visionary in the European CRM service providers Magic Quadrant, because it has a strong business-consulting-driven vision. CSC is one-fifth the size of the leading CRM service providers in Europe.

• Countries: CSC CRM resources and projects are deepest in France, the U.K. and Germany, with a presence in Italy, the Netherlands, Belgium and Spain. CSC's CRM practice in France has a particularly strong reputation for innovation and consulting expertise.

• Industries: Its greatest portion of CRM resource skills and project experience is in insurance, banking, travel, hospitality and other business services, and then pharmaceuticals, retail, the public sector, utilities and telecommunications.

• Business consulting vision: CSC is relatively strong in complex business process projects and analytics consulting, with a focus on industry-specific innovation. Its revenue mix remains highly skewed to business consulting and process work, compared with competitors, and all reference customers said at least 50% of the project was of this type of work. CSC's customer references said that all projects had at least 50% (and most, more than 75%) of the work focused on business strategy or process redesign, as opposed to technology implementation.

• MDM and analytics: CSC's domain expertise continues to strengthen in master data management, analytics, pricing analysis and customer intelligence.

• Rehire and willingness to recommend: CSC's references were the least willing to recommend the service provider, and the company had the lowest likelihood of rehire in 2009, although customer satisfaction scores were average. Reference customers were most critical of software package expertise, reference checks, contracting practices and cultural fit.

• Global delivery: Although CSC is making an effort to grow its offshore resources, it remains limited compared with the leaders and challengers in this Magic Quadrant. This was reflected in the customer references, which indicated that less than 1% of resources were sourced from offshore, and none from nearshore, although almost half the work was completed.

Deloitte remains a leader in the European CRM service providers Magic Quadrant. Gartner believes Deloitte's vision for CRM lost momentum in the past year. Although revenue growth has been below average, Deloitte remains a strong competitor in a wide range of markets.

• Countries: Deloitte has its strongest CRM presence in the U.K., Germany, Belgium and the Netherlands, and then Spain, Italy and France.

• Industries: The greatest portion of Deloitte's CRM resource skills and project experience in 2009 was in banking and insurance, telecommunications, public sector, process manufacturing (e.g., consumer goods) and utilities, then discrete manufacturing (e.g., the automotive industry).

• Business consulting: Deloitte focuses on higher-value, advisory-led consulting. This is reflected in Deloitte's reference customers, which had the highest percentage of projects that were pure business strategy or process design, with no technology or software implementations in Europe. Deloitte references rated Deloitte high in project management and project implementation methodology.

• Price and team members: When Deloitte is rejected by buyers, the most common reasons cited in Gartner reference checks are typically for being too expensive or because the team members provided by Deloitte did not appear to be the right fit for the buying organization.

• Global delivery: In line with its business model, Deloitte uses very few offshore resources on projects, compared with CRM competitors. Reference customers said that only 1% of the work was performed offshore, and 3% nearshore — the lowest levels of any of the vendors on this Magic Quadrant.

IBM Global Business Services remains positioned in the Leaders quadrant with the highest level of ability to execute, due to growth when peers shrunk and relatively high customer satisfaction levels.

• Countries: IBM Global Business Services has resources in more countries than competitors, with an above-average presence in Germany, the Netherlands, Denmark and Switzerland.

• Industries: The greatest proportion of IBM Global Business Services' CRM resource skills are focused in telecommunications, insurance, banking, industrial manufacturing, retail, pharmaceuticals and the public sector.

• Customer satisfaction: With steady improvement over the past three years, IBM's reference customers scored IBM as the second-highest provider for customer satisfaction, with high scores in willingness to recommend and likelihood to rehire.

• Global delivery: IBM Global Business Services makes strong use of offshore capabilities in India, China, Brazil and multiple other countries. Given this strength, which has been evident in reference checks in previous years, it was surprising that IBM customer references said that offshore resources were used for 11% of the workload, nearshoring for 5% of the workload, that 10% was performed off-site and 74% on-site. This was the second-highest level of on-site work of the providers evaluated, according to the references surveyed.

• Price: The most common reason IBM Global Business Services loses competitive bids is because of the price of its services, according to Gartner reference checks. The second most-common cause of losing business is poor references when the potential buyer was evaluating IBM.

• Prior engagement expectations: IBM missed opportunities to leverage its existing relationships, as client references rated it relatively low for delivery against expectations during prior engagements.

Infosys remained in the Challengers quadrant in 2010, due again to an above-average growth rate, an above-average customer satisfaction score and, particularly, its relatively high likelihood-to-recommend score. Infosys remains one-fourth the size of leading CRM service providers in Europe.

• Growth: Gartner estimates that Infosys Technologies' CRM service revenue in Europe grew at a rate greater than that of the market during 2009, and the fourth fastest of vendors on this Magic Quadrant, demonstrating a strong ability to execute.

• Global delivery: Infosys makes strong use of offshore capabilities in India (they are used for all implementation projects), and reference customers said that Infosys delivers 61% of the workload from offshore, compared with 33% on-site.

• Industries: The greatest proportion of Infosys' CRM resource skills and project experience is most heavily focused on telecommunications and utilities.

• Rehire: The willingness by reference customers to recommend the company to a friend or colleague was high, and the likelihood to rehire was the second highest of vendors evaluated.

• Vision: Infosys' vision has a less-visible focus on the new areas of CRM, such as social CRM and digital marketing, than the market leaders.

• Business consulting: Although Infosys has comparatively more CRM business consultants than other offshore competitors, clients still tend to choose Infosys primarily for technology projects. All but one reference said that the project mix was more than 50% technology or software implementation and less than 50% business strategy or process redesign, although there were no longer any references saying that the project was 100% technology or software implementation.

• Geographic coverage: Infosys generates most of its work in the U.K. and Norway. Infosys also has local CRM resources in 10 other European countries, notably in Switzerland, Sweden and Finland. The company needs to build more capabilities in Germany, France, Italy and Spain to achieve the scale of European market leaders.

NTT Data Europe is a new entrant and a niche player on the 2010 Magic Quadrant. NTT Data Europe is included because of its ability to meet the minimum revenue criterion and its appearance on more shortlists in 2009/2010. NTT Data Europe's Cirquent and itelligence brands lead the majority of CRM projects, and are what is assessed in this research. NTT Data Europe is one-fifth the size of leading CRM service providers in Europe.

• Customer satisfaction: NTT Data Europe's reference customers scored customer satisfaction highest, likelihood to rehire third highest and had a strong score for willingness to recommend. In aggregate across these three metrics, NTT Data Europe customer references scored the company highest of the providers evaluated in this study.

• Countries: Most of NTT Data Europe's work is in Germany, Switzerland and Austria, with a growing presence in the U.K., the Netherlands and Spain.

• Industries: The greatest proportion of European CRM resource skills and project experience in 2000 was in discrete manufacturing (with automotive a key focus), telecommunications, insurance and banking.

• Business consulting: Reference customers said that 45% of projects involved a skills mix of 75% business strategy or process redesign and 25% technology or software implementation, or 100% business strategy or process redesign. This is the second-highest ratio of business consulting to implementation skills of the providers assessed on this Magic Quadrant. Customer references rated NTT Data Europe high in cultural fit, and the quality of the members of the project team and their geographic capabilities.

• Growth: NTT Data Europe declined in CRM revenue more than the market average —the third biggest decline of vendors evaluated. Gartner believes this was primarily due to the lack of offshore resources to enable it to offer lower blended rates in the face of the economic recession in 2008/2009.

• Global delivery: NTT Data Europe lags its competitors in its use of global delivery. It has no offshore resources and has only started to develop a global delivery model through the building of nearshore centers. Customer references said that 65% of work was done on-site, 28% off-site and 7% nearshore.

• Vision: NTT Data Europe has built a sizeable CRM presence through the acquisition of multiple companies that remain autonomous brands: Cirquent, itelligence, The Revere Group and Vertex. Other companies will likely follow. The result is that there is a lack of coordination across Europe, a lack of unified leadership and a lack of vision for the whole CRM practice. However, there are pockets of innovation, such as the added services factory and mobile application development.

• Geographic coverage: NTT Data Europe's CRM coverage is limited to six European countries (Germany, Switzerland, Austria, the U.K., the Netherlands and Spain) and is not present in major countries using CRM like France, Italy or the Nordics.

Patni is a new entrant. It is a niche player on the 2010 Magic Quadrant because of its rapid growth, which has enabled it to meet the inclusion criteria, and its appearance on more shortlists in 2009/2010. Patni is one-seventh the size of leading CRM service providers in Europe.

• Growth: Gartner estimates that Patni's European CRM service revenue had the second-fastest growth rate in 2009.

• Industries: The greatest portion of Patni's European CRM resource skills and project experience in 2009 was in banking and insurance, followed by healthcare and discrete manufacturing.

• Global delivery: Patni makes strong use of offshore capabilities in India. Those offshore capabilities are used for all implementation projects. Reference customers said that Patni delivers 73% of the workload offshore and 27% on-site — this is the highest proportion of work done offshore of the providers on this Magic Quadrant.

• BPM: Although most Patni work is with Siebel, similar to other offshore providers, Patni has a notable Pegasystems-Chordiant Software practice in Europe that stands out in terms of both scale and reputation.

• Vision: Patni's vision is not differentiated. The focus is on providing high-quality technical implementation skills and leveraging a solid global delivery model to achieve competitive pricing. The company's nascent industry focus within CRM and the development of intellectual property and tools indicate that the practice is maturing, but the vision remains limited for now.

• Business consulting: Patni's revenue mix is 13% for consulting work, versus 87% for implementation and deployment. This is the lowest proportion of consulting work of the providers on this Magic Quadrant. Not surprisingly, no customer references had a mix of more than 50% business strategy or process redesign to 50% technology or software implementation.

• Experience of resources: Patni's overall customer satisfaction by references was average, as was willingness to rehire and willingness to recommend. Yet Patni references had some specific areas that they rated low: the quality of the team members proposed for the project, tenure of consultants, product independence and system integration expertise.

• Geographic coverage: Patni CRM coverage is extremely limited outside the U.K., with a direct presence in several central European countries, but not in major countries using CRM, like France, Germany, Italy, Spain or Scandinavia.

Siemens remains a niche player in the 2010 Magic Quadrant, with average revenue growth and relatively low customer satisfaction scores. Its vision and strategy continue to improve. Siemens is one-eighth the size of leading CRM service providers in Europe.

• Countries: Most Siemens IT Solutions and Services CRM resources and projects are located in Germany, Russia, Spain, the Netherlands, Italy and Turkey, with a direct presence in eight other countries.

• Industries: The greatest portion of Siemens' CRM resource skills and project experience lies in discrete and process manufacturing (particularly from other parts of Siemens), telecommunications, media, energy and the public sector.

• Vision: Siemens is beginning to shift to a more business-strategy-led and process-consulting-led approach. The vision has sharpened in terms of adopting new CRM developments, such as software as a service (SaaS) and social CRM.

• Customer satisfaction: Siemens had the lowest customer satisfaction scores of those evaluated in Gartner's European-client reference checks, specifically in software package expertise, service-oriented architecture (SOA) design skills, and expertise in customer service and support. Likewise, reference customer likelihood to rehire and willingness to recommend were low.

• Global delivery: Siemens' offshore capabilities (that is, in Russia, India and Croatia) are limited when compared with other larger ESPs, and attempts by Siemens to scale these resources remain comparatively slow. Customer references said that offshore resources were used for 4% of the workload, nearshore resources for 14%, that 35% was done off-site and 47% was done on-site.

• Executive focus: Siemens IT Solutions and Services is set for more restructuring in 2010. Executive focus on the CRM practice has been notable by its absence. This has led to uncertainty as to the future of the CRM practice. Siemens executives will either choose to focus on other areas, at the expense of CRM, or focus more on CRM after 2010. Their decision will make or break the company's CRM practice during the next two years.

T-Systems is again listed as a niche player in the 2010 Magic Quadrant due to its financial performance for its CRM practice and its limited vision beyond its two primary industries. T-Systems is one-seventh the size of leading CRM service providers in Europe.

• Countries: Most of T-Systems' CRM resources and projects are located in Germany and France, with a CRM presence in Spain, Austria, Turkey and several countries in Central Europe.

• Industries: More than 75% of T-Systems' work is in two industries: telecommunications (which includes work for Deutsche Telekom) and automotive.

• Cloud CRM: T-Systems is selling usage-related billing for the operation of SAP and Microsoft CRM systems. T-Systems has skill strengths in call center customer service, master data management, customer intelligence analytics and loyalty programs.

• CRM growth: T-Systems' system integration revenue has recovered and grown in 2Q10, the proportion of work outside the Deutsche Telekom group is on the rise and margins are improving. However, Gartner estimates that T-Systems' CRM practice performance revenue was about average for the market as a whole, with single-digit revenue decline in 2009 and roughly flat revenue in 2010.

• Global delivery: T-Systems has limited offshore capabilities. Its resources in India were transferred to Cognizant in 2008. Its biggest remaining offshore resources in Russia are used on less than 5% of projects.

• Business consulting: The company has limited CRM business-consulting resources, with a revenue mix of 15 to 85 for consulting work versus implementation, which is low in consulting, compared with the market leaders.

Tata Consultancy Services (TCS) continues to be a challenger in the 2010 Magic Quadrant, with an above-average growth rate and the strongest "likelihood to rehire" rating by its reference customers. TCS is one-fourth the size of leading CRM service providers in Europe.

• Industries: TCS's greatest portion of CRM resource skills and project experience in Europe is in banking and insurance, then telecommunications.

• Global delivery balance: TCS uses India-based offshore resources on all implementation projects. However, TCS has been gradually increasing the percentage of work done on-site during the past few years as the role of its CRM practice becomes more consultative. Whereas traditional CRM service providers deliver 30% to 35% of a project from offshore, on average the offshore providers deliver closer to 65% to 70% offshore. TCS reference customers said that TCS delivered almost a 50:50 mix of on-site and offshore.

• Rehire: TCS overall customer satisfaction by references was around the survey average, but "likelihood to rehire" was the highest of the providers evaluated in European reference checks.

• Vision: The TCS CRM vision and practice leadership has drifted away in the past year. Having previously been the most innovative of the offshore providers, all the other leading main offshore providers are now showing breakthroughs in areas where TCS does not have example customers.

• Business consulting: TCS has yet to achieve strong traction for business-consulting services. The most common type of project for TCS remains as 25% business strategy or process redesign and 75% technology or software implementation. No customer references said that TCS was doing more than 50% of the work in business strategy or process redesign.

• Geographic coverage: TCS generates most of its work in the U.K. and Finland. TCS also has local CRM resources in 12 other European countries, notably in the Netherlands and Scandinavia. The company needs to build more in France, Germany, Spain and Italy to achieve the scale of European market leaders; recent TCS acquisitions are moving the company into other geographies for which CRM might follow.

Wipro regained its challenger status in this year's Magic Quadrant because of its growth. It also sharpened its vision for the practice, but its customer reference satisfaction scores, while back to average, trail the other offshore providers. Wipro is almost one-sixth the size of the leading CRM service providers in Europe.

• Growth: Gartner estimates that Wipro's European CRM service revenue had the third-fastest growth rate in 2009.

• Industries: The greatest portion of European CRM resource skills and project experience in 2009 continues to be in telecommunications, then automotive and high-technology manufacturing.

• Global delivery: Wipro makes strong use of offshore capabilities in India. Those offshore capabilities are used for all implementation projects, and reference customers said that Wipro delivers 58% of the workload offshore and 39% on-site.

• Business consulting: Wipro continues to build business-consulting expertise, but its revenue mix has remained at 19% for consulting work versus 81% for implementation, similar to last year. The most common project type according to customer references was 50% business strategy or process redesign and 50% technology or software implementation, which signifies a greater mix of process and strategy work than in previous years.

• Experience of resources: Overall customer satisfaction by references was average, as was willingness to rehire. Yet, Wipro references had some specific areas that they rated low: the tenure of consultants, product independence, contracting practices, and sales and marketing expertise.

• Geographic coverage: Wipro's CRM coverage is limited outside the U.K. France, Germany and Saudi Arabia are the countries with the next largest resources, but there is a big gap. The company is still relatively weak in Spain, Italy, Belgium, Denmark, Austria and Norway, as compared with the market leaders.