Brand Recognition: U.S. Companies Rank IBM, Microsoft, Oracle, HP-EDS, and Accenture as Top 5 Vendors for Application Outsourcing

This IDC study highlights demand-side results of customer perception of top-ranked providers in the category of application outsourcing services. The results of this study indicate that brand recognition plays a significant role in influencing enterprise perception of provider service capabilities. Rankings further highlight the shift by enterprise in accepting application hosting as a form of application outsourcing. Vendors are given not only a framework of those players that appear to have competitive advantage as related to customer perception in this area but also key characteristics of providers that enable such advantage. Further, this study provides IDC insight into what key areas of focus providers need to address to ensure both short-term and long-term success based on customer need and market directions in AO.

"Success as a provider in application outsourcing/hosting will require players to not only emphasize the cost side of the value proposition but also highlight how they can deliver on the operational and strategic value tied to AO. The more invested a provider is in a client's business operations and development strategy, the more it can help reduce portfolio complexity while offloading some of the management control that clients maintain to drive successful outsourcing engagements. While outsourcer employee attrition, language, and cultural issues can require joint vendor-client oversight, outsourcers that embed tighter governance and control within all types of application engagements will realize greater client satisfaction," says Rona Shuchat, director of Application Outsourcing Services.