Here's Who Made Gartner's 2015 End-User Outsourcing Magic Quadrant

Automation, Mobility Driving End-User Outsourcing Demand

Gartner late last month released its North American Magic Quadrant for End-User Outsourcing Services, which evaluated 19 IT companies with offerings to manage service desk, desktop and mobility needs for businesses.

The technology research firm expects the IT services market to grow at a 4.2 percent compound annual growth rate (CAGR) through 2019, with public cloud computing services leading the way with a CAGR of 30.3 percent. Conversely, desktop and data center outsourcing is expected to experience a 5 percent decline.

Automation, mobile computing, virtualization, hosted virtual desktop and bring-your-own device are the primary end-user outsourcing growth drivers, Gartner found.

Methodology

The Gartner Magic Quadrant evaluates service providers on two sets of criteria: their success on delivering results today and into the future (Ability to Execute); and their service operating model and strategic plans for growth and service improvements (Completeness of Vision).

Eight of the 19 firms Gartner evaluated are considered leaders, meaning they deliver their services skillfully and have a clear vision for the market. One is a visionary, meaning it has a clear vision of the market but could improve its service delivery.

Six firms are classified as challengers, meaning that execute well but have less defined views of the market. And four providers emerged as niche players, meaning they focus only on a particular segment of the client base.

Leader: Dell

Dell grew its end-user outsourcing service offerings revenue 8 percent in 2014 to $2.16 billion, and has 2.63 million desktop and mobile device end users.

The Round Rock, Texas-based company -- whose services practice is ranked No. 9 on the CRN Solution Provider 500 -- saw its North American service offerings workload grow by 5 percent last year, with 1.1 million incidents per month in the continent.

Dell has eight service desk centers for North American clients, which resolve 20 percent of incidents using a fully automated approach. The company services all industries with standard desktop applications, and has a market sweet spot of clients with 5,000 users.

Dell

Strengths: Dell recently partnered with ServiceNow to bring more standardization, automation and predictive analytics to its existing data center and end-user management portfolio. Clients told Gartner that Dell's service management teams offer a wide array of products and services, are flexible and are willing to support non-Dell hardware.

Cautions: Clients indicated that Dell needs to show more innovation in its service practice by upgrading service management tools and better using information generated from service desk requests. The company still approaches the market from a hardware rather than a managed services perspective, Gartner found, and tends to operate in vertical silos.

Leader: Unisys

Unisys grew its North America end-user outsourcing business by 12.7 percent in 2014 to $445 million, supporting 590,000 desktops and 271,000 mobile devices in the region.

The Blue Bell, Pa.-based company -- No. 19 on the CRN SP 500 -- has four North America-focused service desks handling 342,000 incidents monthly, of which 18 percent are resolved using a fully automated approach.

Unisys employs 4,384 desktop technicians around the globe, and its market sweet spot is clients with 60,000 users.

Unisys

Strengths: Unisys is investing heavily in innovative technologies such as using Facebook for a service desk portal -- which is expected to launch next year -- and user-friendly service catalogs for automated ordering. Clients told Gartner they are pleased with Unisys' focus on continuous improvement and ability to deliver innovative support across multiple technology platforms.

Cautions: Unisys might be suffering from branding, sales and marketing issues since it fails to crack the top 10 in North American IT outsourcing revenue, Gartner said. The company could also cannibalize its service desk -- which represents a third of all IT outsourcing revenue -- with its social media support. Clients said Unisys often takes awhile to coordinate and implement technology and tool set changes.

Leader: CompuCom

CompuCom boosted its North American end-user outsourcing revenue by 2.7 percent last year to $824 million, and employs 6,800 remote dispatch technicians to support it.

The Dallas-based company, No. 23 on the 2014 CRN SP 500, supports 4.4 million North American end users from four service desk centers. CompuCom managed more than 490,000 mobile devices and has a market sweet spot of companies with 50,000 users.

CompuCom

Strengths: Of the 19 companies in this Magic Quadrant, Gartner said CompuCom has the most extensive persona-based profile system, which can identify the worst-performing devices for replacement rather than just replacing assets based on age. The company has also recently invested in a mobile access solution enabled by AT&T and a walk-up service center that delivers flexible end-user support.

Cautions: Clients have cited the high turnover in CompuCom's C-suite -- which includes a new CEO -- as an issue, especially as private equity ownership pressures new leadership to move the company toward higher margins. The company has also adopted an asset-light approach to data center and server co-location space, which Gartner said may add risk to the service delivery chain.

Leader: CSC

CSC's revenue from end-user outsourcing services in North America held flat in 2014 at $450 million, with the number of technicians supporting the practice falling from 1,200 to 1,080.

The Falls Church, Va.-based company, No. 5 on the CRN SP 500, saw its North American end-user base fall by 10 percent in 2014 to 1.1 million, with an estimated 722,000 desktop end users and 76,000 mobile devices in its client pool.

CSC's 14 global desk center centers support specialized applications in all industries and government sectors, with a market sweet spot for companies with 20,000 users.

CSC

Strengths: CSC is gaining more traction in the large account space with everything from storage-as-a-service to cybersecurity offerings to a machine-to-machine application. Customers told Gartner that CSC takes SLAs seriously, working to resolve any issues that arise from performance challenges. The solution provider has also formed cloud partnerships with Amazon Web Services, Microsoft, VMware and AT&T.

Cautions: CSC's lack of revenue growth is a concern, Gartner said, with continued struggles resulting in more cost-cutting, low employee morale and execution issues. Clients said CSC's global support centers have inconsistencies in language support quality, and have also raised concerns about the split of the company taking place in November. Clients should also monitor the delivery quality for collaboration-based solutions.

Leader: IBM

Gartner estimates that IBM's North American end-user outsourcing services accounted for $1.3 billion of the company's $55 billion global IT service revenue in 2014.

Although North American outsourcing sales were flat compared to last year for the Armonk, N.Y.-based company, whose global services division is No. 1 on the CRN SP 500, IBM is still ahead of most of the competition.

Big Blue plans to place a $1 billion bet on its Watson cognitive computing system, while simultaneously investing $26 billion in in big data and analytics.

IBM

Strengths: The company's SmartCloud Control Desk offering was praised by Gartner as a strong product with advanced features. The report also commended IBM for its flexible delivery model that allows customers to choose between Software-as-a-Service or on-premise delivery. Big Blue also entered into a global partnership with Apple for enterprise mobile solutions, bolstering its MobileFirst Platform.

Cautions: On the downside, Gartner reports that IBM's cognitive computing program, Watson, has yet to be deployed to reduce desk costs with automation. Additionally, some of the company's smaller customers reported shying away from business with the vendor because they want to be a valued customer to their solution provider partner.

Leader: HP

IT services represent 27 percent of HP's global revenue, but fell 7 percent in 2014 to $30.1 billion. HP is selective with the end-user outsourcing deals it pursues, servicing companies with anywhere from 3,000 to 250,000 users.

The Palo Alto, Calif.-based company, whose enterprise services division is No. 3 on the CRN SP 500, employs more than 8,000 service desk staff across 40 centers worldwide, supporting more than 44 million contracts.

HP will officially split into two companies this fall, with service, software and infrastructure falling under the Hewlett Packard Enterprise banner.

HP

Strengths: HP is the first in the market with an end-to-end, enterprise-grade service offering in the Microsoft ecosystem thanks to the addition of its Enterprise Mobility Suite. The vendor's Workplace Management Services has 22 capabilities to allow clients to build the right amount of service. Customers said HP's account team is very sensitive to client needs and able to prioritize a customer's productivity.

Cautions: End-user outsourcing products and services will require support from both Hewlett Packard Enterprise and HP Inc., which may make the offerings less seamless after the split. Clients pursuing pure cost reduction will not play to HP's strength, Gartner said, since the company is more focused on integrating analytics, cloud and mobility.

Leader: HCL Technologies

HCL Technologies has showed impressive growth in its North American end-user outsourcing services in recent years, going from $140.9 million of sales in 2012 to $186 million in 2013 to $235.6 million last year.

The Noida, India-based company supports an estimated 275,000 desktop end users and 164,813 mobile devices, employing 1,532 desktop technicians across three service desks to support end-user outsourcing in North America.

HCL supports more than 800,000 service desk clients -- resolving 15 percent of their incidents using a fully automated approach -- and considers companies with 40,000 users to be its market sweet spot.

HCL Technologies

Strengths: HCL saw across-the-board sales growth, ranging from 20 percent for desktop and mobility offerings to 25 percent for the service desk to 43 percent for mobile and virtual device management.

Gartner praised HCL for quickly adapting its service delivery model to support technology trends and said the company was respected by clients for its expertise, adaptability and fair pricing.

Cautions: Although HCL has added three data centers in the U.S. this year, those facilities may add some unwanted overhead to its overall delivery costs. Gartner said some customers also feel that HCL is lacking leadership and is overly reliant on its clients for direction and forward-thinking approaches.

Leader: Atos

After growing its North American end-user outsourcing revenue by an impressive 20 percent in 2013, Atos saw sales fall 3 percent in 2014 to $300 million.

The Bezons, France-based company employs 148 desktop technicians and resolves 17 percent of its service desk issues using a fully automated approach, with a market sweet spot for companies that have 40,000 users.

Atos currently manages more than 150,000 mobile devices in North America, handling 150,000 incidents per month in the same geography.

Atos

Strengths: Customers have reported that Atos' phone support is very responsive, service-level agreements are always met and the company works closely with end-user IT departments. Gartner also praised Atos for leveraging its Canopy offering with Managed Mobility, allowing clients to quickly and securely implement a strategy to manage and secure devices and providing a basis for a BYOD policy.

Cautions: Atos acquired Xerox's ITO business in July, opening up a larger number of partners for the company but requiring management resources throughout the transitional process. Gartner reports that customers feel the company's asset management services and delivery of resources have not been living up to their expectations, even as Atos looks to hire the right candidates to alleviate service lag.

Visionary: Fujitsu

Fujitsu increased its North American end-user outsourcing services revenue by 13 percent in 2014 to $69 million, boosting the number of desktop and mobile device users it supports in the region by 40 percent to 354,000.

Though the Tokyo-based company addresses all industries, Fujitsu's revenue growth has largely come from its desktop and mobility support service lines.

Fujitsu resolves 25 percent of its service incidents using a fully automated approach and has a market sweet spot for customers with 5,000 users.

Fujitsu

Strengths: Fujitsu has successfully simplified its end-user outsourcing portfolio and improved integration between offerings, allowing for greater customization. The company uses an employee-delivered model for North American clients and avoids engaging with subcontractors or partner staff. Clients said Fujitsu will adjusting delivery to support changing business needs and wants to boost first-call resolution.

Cautions: Clients that desire a significant domestic or near-shore capability might be concerned by Fujitsu's limited presence in North America. Specifically, Gartner said the company's Japan-centric management style may hamper Fujitsu's ability to quickly respond to North American market needs. Clients told Gartner they would like to see greater autonomy from local account managers.

Challenger: Wipro

Wipro's North American end-user outsourcing service revenue increased 26.3 percent in 2014 to $211 million, with the company supporting 496,000 PCs and mobile devices in the region.

The Bangalore, India-based company, No. 21 on the 2013 CRN SP 500, employs 714 end-user technicians across five service desks to address 500,000 monthly incidents in North America, Gartner said.

Wipro resolves 22 percent of its service desk incidents using a fully automated approach, Gartner said, and has a market sweet spot for clients with 60,000 users.

Wipro

Strengths: The acquisition of Canadian firm Atco I-Tek will provide Wipro with a presence in Canada and strengthen its position in the oil and gas industry. The company will implement a next-generation help desk for clients this year using analytics and self-healing capabilities from its artificial intelligence platform. Clients praised Wipro for its technical capabilities, user interactions and ethical leadership.

Cautions: Wipro will be hard-pressed to maintain its position in the energy and resource sector given intense cost scrutiny in the vertical. Clients with Canadian locations will need to understand how Atco I-Tek will be integrated into Wipro's delivery of end-user outsourcing services. Customers said Wipro struggles with assimilating to a client's business culture and coordinating offshore and onshore units.

Challenger: Cognizant

Cognizant's global service revenue increased 16 percent last year to $10.26 billion as the company demonstrates continual market growth across all industries.

The Teaneck, N.J.-based company, No. 8 on the CRN SP 500, employs 1,163 desktop technicians -- down from 1,500 last year -- across 12 global service desk centers. Cognizant handles 2 million incidents per month in North America, supporting 1.1 million desktops and 413,000 mobile devices.

Cognizant's service desk resolves 10 percent of incidents using a fully automated approach, and has a market sweet spot of customers with 80,000 users.

Cognizant

Strengths: Cognizant has developed an out-of-the-box, bring-your-own-device product that separates corporate and personal data, enabling Cognizant administrators to wipe corporate data off a device while leaving personal data untouched. The company has also boosted its onshore delivery capability by expanding its Denver center and opening facilities in Phoenix and Charlotte.

Cautions: Cognizant's approach of using third-party labor for field support can result in different staff members responding to client events, creating the potential for inconsistent service. Clients said Cognizant lacks proactiveness in bringing forward new ideas for service innovation. The reorganized digital and cloud computing business unit could also result in minor day-to-day disruptions in the short term.

Challenger: Tata Consultancy Services

North American end-user outsourcing sales skyrocketed 26 percent in 2014 for Tata Consultancy Services to $215 million, with the number of service desk employees supporting the region soaring from 1,481 to 1,933.

The Mumbai, India-based company, No. 4 on the CRN SP 500, supports 718,000 desktop end users and 367,000 mobile devices across 24 service desk centers, handling 652,500 incidents per month for North American clients. The company recorded regional service desk growth of 35 percent over the past year.

TCS resolves 19 percent of service desk incidents using a fully automated approach, and has a market sweet spot for customers with 15,000 users.

Tata Consultancy Services

Strengths: TCS focuses on self-service, analytics and automation to improve efficiency and drive down the human-handled events, reducing incidents by 25 percent and boosting talk and wrap-up by 30 percent. TCS' services are also vendor-neutral, allowing the company to optimize solutions according to specific business requirements. Clients said TCS is responsive to customer needs and keeps low prices.

Cautions: TCS uses proprietary tools, meaning that clients could lose some of their functionality if they transfer to a different service provider. Clients told Gartner they'd like to see more thought leadership around transformation, and face challenges with the delivery of additional or new services. TCS' margins or price competitiveness could be affected if scalability for large deals becomes an issue.

Challenger: Pomeroy

Pomeroy's revenue from North America end-user outsourcing services held flat in 2014 at $85 million, with desktop field support technician employment ticking up 2.6 percent to 1,400.

The Hebron, Ky.-based company, No. 44 on the CRN SP 500, responds to 183,000 incidents monthly in two North American service desk centers and a dispatch center. Pomeroy supports 962,800 desktop end users and manages more than 450,000 mobile devices.

Eight percent of service desk incidents are resolving using a fully automated approach, with a market sweet spot of clients with 25,000 users.

Pomeroy

Strengths: Pomeroy recently unveiled an in-house cloud-based service automation platform that capitalizes on ITIL processes to optimize incident volume, shorten resolution times, achieve high service quality and lower costs. Clients said that Pomeroy has excellent capabilities around desktop and service migrations, and appreciate the flexibility, responsiveness and affordability of the company's services.

Cautions: Clients told Gartner that Pomeroy is occasionally challenged to deliver high-end technical engineers with its service desk, particularly after normal business hours. The company's lack of global cases can sometimes be a deterrent, with Pomeroy's French, Spanish and Portuguese-speaking staff all based in the U.S. Clients should look into how Pomeroy's second service desk will support workloads.

Challenger: Stefanini

Stefanini boosted North American end-user outsourcing revenue 21.8 percent in 2014 to $102.3 million, with its 710 desktop technicians focused primarily on manufacturing.

The Sao Paulo, Brazil-based company addresses 417,700 global contacts monthly across 24 service desk centers in 16 different countries. Stefanini supports roughly 300,000 PC and mobile end users in North America, according to Gartner.

The company's service desk resolves 12 percent of incidents using a fully automated approach, with a market sweet spot for customers with 20,000 users.

Stefanini

Strengths: Stefanini achieved a 100 percent North American client renewal rate in 2014, Gartner said, thanks to flexibility and gain sharing deals, where savings from improved performance are shared with employees. The company last year launched an intelligent platform that uses software, systems and processes to enable a virtual answering service to reduce human intervention in service desk delivery.

Cautions: Clients said that Stefanini suffers from high turnover in Level 1 desk support and limited technical and communication skills, as well as lacking innovation, automation and user enrichment initiatives for existing customers. Stefanini only has a small number of clients using its desktop and mobility solutions in North America, and has no regional HVD customers of more than 5,000 users.

Challenger: Long View Systems

Long View Systems grew its North American end-user outsourcing revenue 20 percent in 2014 to $125.7 million, with 60 percent generated from the oil and gas industry.

The Calgary, Alberta-based company, No. 73 on the CRN SP 500, supports 143,000 PC and mobile end users across five dedicated service centers in North America, and has a market sweet spot for customers with 5,000 users.

Long View derives 64 percent of its overall revenue from end-user services and is experiencing the fastest growth in the Eastern U.S. and Eastern Canada. Other verticals supported by the solution provider includes retail, finance, government, hospitality, medical and manufacturing services.

Long View Systems

Strengths: Long View began providing new centralized shared-service offerings last year to bolster its skill sets and lower costs. Customers told Gartner that Long View's staff is experienced, skilled and flexible, and employs a responsive and customer-service focused management team. The company also allows customers to terminate contracts early and provides them with easy exit options.

Cautions: The majority of Long View's service desk and desktop outsourcing staff members are located onshore, which could pose challenges to customers seeking global coverage. Clients told Gartner that Long View's resource pool is relatively small at some locations, hindering the presentation of a unified front. Gartner also recommends that customers outside oil and gas review Long View's bench strength.

Niche Player: CGI

North-American end-user outsourcing revenue for CGI declined from $140 million in 2011 to $121 million in 2012 to $115 million in 2013 to $110.7 million last year.

The Montreal, Quebec-based company, No. 15 on the CRN SP 500, employs 1,045 desktop technicians across 28 service centers in 15 countries, supporting 126,000 desktop end users and 23,000 mobile devices. The service desk centers have a North American incident volume of approximately 333,000 cases monthly.

CGI has not resolved any service desk incidents in North America using a fully automated approach, and has a market sweet spot for clients with 25,000 users.

CGI

Strengths: CGI has bolstered its managed virtual desktop integration portfolio through a partnership with Dell, allowing CGI to strengthen its portfolio and expand service offerings. The company has recently expanded, establishing a Center of Excellence in Quebec and another IT service center in Louisiana. Clients said they like CGI's deep knowledge and globally consistent standards.

Cautions: CGI's consultative approach to HVD netted just 5,500 virtualized desktops, which is low compared with peers, though the Dell alliance should help address this. Clients told Gartner that CGI's local account management is less responsive to their needs since the solution provider uses centralized management out of Montreal. The company also continues to lose market share, Gartner said.

Niche Player: Bell Techlogix

North American end-user outsourcing service revenue for Bell Techlogix grew 5 percent last year to $75 million.

The Indianapolis-based company, No. 251 on the CRN SP 500, employs 460 desktop technicians across two service desks, handling a North American monthly incident volume of 242,500 cases. The company supports 118,000 desktops and 142,000 mobile devices across the education, health-care, retail, high-tech, financial and manufacturing verticals.

Bell Techlogix has a market sweet spot of clients with 20,000 users.

Bell Techlogix

Strengths: Even though Bell Techlogix relies entirely on an on-shore delivery model, the company provide multilingual, around-the-clock support to users based across the entire globe. Clients said Bell Techlogix has engaged leadership, skilled and professional employees, competitive rates and is reasonably flexible. The company also recently implemented a service delivery management platform.

Cautions: Relying on an entirely domestic service desk might make it difficult for Bell Techlogix to fulfill specific service requirements and be competitive on cost. Clients told Gartner that the company has limited abilities around data analytics, architectural resource and guidance for emerging technologies. The company might also struggle with incident management for clients with very customized portfolios.

Niche Player: Genpact

Genpact grew its North American end-user outsourcing service revenue by 15 percent in 2014 to $89 million.

The New York-based company employs 125 desktop technicians across 12 service desk centers, handling 1.55 million incidents monthly. Genpact supports 52,000 desktop end users and 22,500 mobile devices across the financial, life science and manufacturing verticals.

Almost 20 percent of incidents on Genpact's service desk are resolved using a fully automated approach, and the company has a market sweet spot for clients with 38,000 users.

Genpact

Strengths: Genpact has invested in integrating and automating mobility, desktop, support and enterprise analytics into its end-user outsourcing suite. The company has more than 90 percent of its staff operating out of low-cost locations and can support more than 25 languages. Clients said Genpact's has strong technical skills and liked the company's strong governance models and reporting capabilities.

Cautions: Clients said that Genpact's offshore personnel have inconsistent skill levels and vary in communication abilities, and told Gartner they'd like to see more of an onshore presence. The company is also very service-desk-centric, deriving less than 10 percent of its total outsourcing revenue from deployments. End users should also ensure that Genpact can meet their onshore prerequisites.

Niche Player: C3i Healthcare Connections

C3i Healthcare Connections grew its North American end-user outsourcing revenue 19.1 percent in 2014 to $81 million, with 59 percent of that revenue generated by the service desk.

The Morristown, N.J.-based company -- which is owned by Telerx -- employs 288 desktop technicians across five service desks and a hardware depot, handling 79,000 North American incidents per month. The company supports 42,000 desktop and 50,000 smartphones, notebooks and mobile devices in the health-care vertical.

C3i doesn't handle any incidents via automation, and has a market sweet spot of clients with 30,000 users.

C3i Healthcare Connections

Strengths: The 2014 Telerx acquisition has added medical information, patient support, drug safety, digital health and social media services to C3i's robust technology support services. Clients have been pleased with C3i's understanding of both the technology and business processes in the life science industry. C3i offers 24/7 support in more than 30 languages for medical and commercial firms.

Cautions: C3i does not offer any desktop virtualization services or automated help desk capabilities, both of which Gartner considers vital to end-user outsourcing. Clients have expressed concerns about C3i's slow global growth outside North America and Japan. C3i is also not well-suited for clients outside the life science vertical that require a full-service end-user outsourcing effort, Gartner said.