2021 German IT Sourcing Study Results Published

The 2021 German IT Sourcing Study, conducted by Whitelane Research in collaboration with Navisco AG – Sourcing Professionals, investigates more than 490 unique IT sourcing relationships as well as more than 300 cloud sourcing relationships held by close to 200 participants of the top IT spending organisations in Germany.

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Participants
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IT/Cloud Service Providers
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Cloud sourcing relationships
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IT sourcing relationships

Key findings from the 2021 German study:

71% of all respondents in the study confirm they will outsource at the same rate or more, with 41% citing that they are planning to outsource more in the next two years. Insourcing remains stable at 13% after a significant decrease last year from 22% as organisations predominantly look to insource industry specific systems in order to achieve faster time to market and improved quality outcomes. Germany predicts the third highest amount of outsourcing in Europe after the Netherlands (50%) and BeLux region (46%).

By industry, most outsourcing is predicted for the energy and utilities sector with 56%, followed by the manufacturing and chemicals sector with 50%. In contrast, only 36% of financial services organisations are planning to increase their level of outsourcing while one in five respondents from the sector are planning to insource (8% above the overall average for Germany).

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Focus on core business is the main driver for organisations in Germany planning to outsource more (66%), followed by access to innovation (62%) and more scalability to business needs (58%). In contrast to the majority of Europe, cost reduction is not considered one of the most influential outsourcing drivers, cited by just 49%.

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Focus on core business
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Cost reduction

Overall, respondents are satisfied with their IT service provider(s), with 92% of all 493 IT sourcing relationships being rated as satisfactory. NTT DATA is the highest ranked provider with a score of 85%, jointly followed by Capgemini and TCS (both at 83%), DATAGROUP (81%) and Wipro and Nagarro (Allgeier) (both at 80%).

NTT DATA also tops the applications and data centre rankings, while DATAGROUP is number one for end-user services.

NTT DATA 85%
Capgemini/TCS 83%
DATAGROUP 81%
Wipro/Nagarro 80%

Top 5 only (Germany 2021)

More than 300 cloud sourcing relationships have been evaluated this year and clients are in general highly satisfied. For infrastructure cloud platforms (e.g., IaaS/PaaS), Microsoft Azure achieves first place with a score of 79% while Microsoft Office 365 remains top of the ranking for Software Cloud Platforms (SaaS) with 78%. More than half of clients predict that 50% or more of new applications will be cloud based although service providers indicate very significant improvements are required with regard to client cloud integration and management skills.

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Google Cloud Platform
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Microsoft 365

Across the nine Key Performance Indicators (KPIs), account management has the highest average score (76%) with Capgemini and Wipro topping the ranking. In contrast, innovation remains the lowest performing KPI for another year with an average score of 61%.

Especially noteworthy is the significant decline in the average pro-activity KPI score (-9%) and the large increase in the price level KPI (+10%), which can potentially be attributed to a combination of factors, including the impact of COVID-19 on different industries and our way of working, but also the disruptive nature of cloud computing and other new technologies that have been accelerated as a result of the pandemic. The need for a significant number of clients to achieve cost reductions might have been at the expense of pro-activity and innovation, and it will be of interest to see how this will evolve in the coming year.

Purchase the full German report

If you would like to purchase a copy of the full German report which contains more detailed information, such as the main sourcing trends, ranking of the service providers by five different IT domains as well as by 9 different KPIs, please email info@whitelane.com. (available in both German and English).

Request the German management summary

Read the key findings of the 2021 German IT Sourcing Study (available in both German and English).
(Please note the German management summary is only provided to end-user organisations).

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