2023 Nordic IT Sourcing Study Results Published
The 2023 Nordic IT Sourcing Study, conducted by Whitelane Research in collaboration with PA Consulting, investigates more than 750 unique IT sourcing relationships and 1,400 cloud sourcing relationships held by close to 400 participants of the top IT spending organisations in the Nordics.
Cyber threat makes IT Security the top investment area for CIOs in the Nordics.
The number one IT investment area for clients is increasing security, resilience and cyber defence. 59% of organisations cite this as a top investment area, indicating that they recognise the importance of IT for their operations and the increasing threat of cyber-attacks.
The second top investment area is automation (56%) as organisations look to lower costs and reduce the need to hire (more) staff in a tight labour market, while migrating core business applications to the cloud is ranked third with 46%.
Companies in the Nordics are increasingly looking at eastern Europe for IT.
The demand for nearshore outsourcing, e.g., to eastern Europe, is expected to grow, with almost 40% of organisations indicating that they expect nearshore to increase within their outsourcing mix.
Two-thirds of organisations in the Nordics plan to outsource at the same rate or more, of which only 20% are planning to outsource more. The number of respondents planning to outsource more is the lowest in Europe and 16% below the 2022 European average of 36%.
20% of organisations plan to outsource less, the highest figure since the first Nordic study in 2013. Achieving faster time-to-market/improved quality outcomes is the number one insourcing driver, cited by 60% of respondents.
Future outsourcing plans
For the first time in the Nordic study, the number one driver for organisations planning to outsource more is access to resources/talent. The driver has increased by 11% compared to last year as organisations look to outsource in an increasingly challenging labour market.
More scalability to business needs, ranked number one last year, is the second most important outsourcing driver. Cost reduction, which has decreased in importance across Europe in 2022, remains a top three driver in the Nordics.
General satisfaction: Exceptional Performers
Two-thirds of the Nordic market is satisfied with their IT sourcing provider, with 67% of all 763 IT sourcing relationships rated as satisfied or very satisfied.
This year, 25 IT service providers have been included in the general satisfaction ranking. TCS, Infosys and Accenture share first place with a score of 81%, followed by new entrant EPAM with 80%. The top four providers are classed as ‘Exceptional performers’ whose scores stand out compared to the other ranked providers.
The average satisfaction has increased by one percentage point to 73%, while client satisfaction remains highest in Norway (76%).
Across the four Nordic countries, the top providers are:
- 𝐃𝐞𝐧𝐦𝐚𝐫𝐤: Cognizant, Accenture & HCLTech
- 𝐅𝐢𝐧𝐥𝐚𝐧𝐝: Accenture, Kyndryl & Infosys
- 𝐍𝐨𝐫𝐰𝐚𝐲: TCS, Cognizant & Accenture
- 𝐒𝐰𝐞𝐝𝐞𝐧: TCS, Infosys and Accenture
Across the five IT service towers, the top providers are:
- 𝐃𝐢𝐠𝐢𝐭𝐚𝐥 𝐭𝐫𝐚𝐧𝐬𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧: TCS, Infosys & Accenture
- 𝐀𝐩𝐩𝐥𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬: TCS, Infosys & Accenture
- 𝐂𝐥𝐨𝐮𝐝 & 𝐢𝐧𝐟𝐫𝐚𝐬𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞 𝐡𝐨𝐬𝐭𝐢𝐧𝐠: Accenture, Cognizant & Infosys
- 𝐖𝐨𝐫𝐤𝐩𝐥𝐚𝐜𝐞 𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬: Cognizant, TCS & ATEA
- 𝐒𝐞𝐜𝐮𝐫𝐢𝐭𝐲 𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬: TCS, Infosys & Wipro
Microsoft Azure achieves first place for infrastructure cloud platforms with a score of 81%, while Microsoft Office 365 remains number one with 84% for software cloud platforms.
72% of respondents are satisfied or very satisfied with their cloud service provider, 5% higher than the results for IT service providers, while 7% are, in one way or another, unsatisfied with the performance of their cloud provider (compared to 13% for IT service providers).