2024 Swiss IT Sourcing Study
The 2024 Swiss IT Sourcing Study represents the largest survey to date. With more than 150 participants from Switzerland’s leading IT-spending organisations, this year’s report provides insights on the top-performing IT service providers and cloud platform providers, with more than 400 unique IT sourcing relationships and over 500 cloud platform relationships evaluated.
Decrease in IT Spending on External Providers
In 2024, 27% of organisations in Switzerland plan to increase their IT spending on external providers, down 8% from the previous year. The majority (40%) anticipate no change, while 21% plan to reduce their IT spending, an increase of 4%. Additionally, 12% are unsure about their future sourcing plans. The primary driver for bringing more IT functions in-house is financial attractiveness, which has risen significantly by 19% since 2023. The financial services sector shows a distinct trend compared to other industries, with 38% planning to spend less on external providers, which is 17% above average. This contrasts with 16% in manufacturing and 18% in pharmaceuticals.
Shifting Priorities for IT Budget Increases
Cost reduction remains the primary driver for Swiss organisations planning to increase their budget for external IT providers, although its priority has notably decreased from 69% in 2023 to 58% in 2024. Scalability is equally important at 58%, followed by focusing on core business activities (53%). Industry differences include the pharmaceuticals sector’s higher emphasis on cost reduction (100% vs. 60% in financial services and 38% in manufacturing) and access to external talent (80% vs. 20% in financial services).
Growing Demand for Nearshore Delivery
Demand for nearshore delivery has increased, with 46% of organisations expecting nearshore to grow, up 7% from last year’s figure of 39%. In contrast, only 9% of organisations predict a decline. However, the available capacity in nearshore may not suffice to meet this significant increase in demand. As a result, clients should anticipate heightened pressure on rates and attrition, which could complicate large transitions to nearshore.
Nearshore delivery
Limited impact from AI and Generative AI
87% of client organisations have yet to experience a significant impact from AI or Generative AI (GenAI). While 24% are experimenting with AI/GenAI, 44% have implemented it with only minor impacts on operations. Only 8% report significant effects, and 5% indicate transformative changes. Minor impact usage is common across industry sectors, while significant and transformative impacts are rare. Manufacturing leads in experimentation, financial services show balanced adoption, and pharmaceuticals focus primarily on minor impacts.
Security Remains Top Investment Area, Investments in AI Growing Fastest
Security is the leading investment priority, with 62% of clients focusing on increasing their security measures and cyber defence capabilities. Automation is second, with 52% planning to invest in automating business processes to boost efficiency and streamline operations. AI and Machine Learning are equally prioritised by 52% of respondents, reflecting a significant 21% increase in importance compared to the previous year.
2024 AI Investment
52%
2023 AI Investment
31%
This year, survey respondents evaluated 402 unique IT sourcing relationships, with 69% receiving ‘a satisfied’ or ‘very satisfied’ rating. The percentage of ‘somewhat satisfied’ relationships increased from 19% in 2023 to 24%.
The general satisfaction ranking features 19 service providers, including newcomers BT and Orange Business Services.
EPAM remains the number one provider for the third consecutive year with an 83% score, followed by Wipro and TCS at 81%, and DXC Technology, Infosys, and Tech Mahindra at 80%. The average satisfaction remains stable at 75%.
2024 Swiss General Satisfaction Ranking (Top 5)
Four service providers have achieved exceptional performer status across one or more IT service towers, with satisfaction scores exceeding the market average and above the standard deviation.
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EPAM: General satisfaction and application services
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DXC Technology: Cloud & infrastructure services
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TCS: General satisfaction, workplace services, and security services
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Wipro: General satisfaction.
This year, respondents evaluated over 500 cloud platform relationships, of which 66% were rated as satisfied or very satisfied, an 11% decrease from the previous year.
In the competitive infrastructure cloud platforms ranking, Amazon Web Services (AWS) leads with a score of 79%, followed closely by Microsoft Azure, Google Cloud Platform (GCP), and IBM Cloud, each at 78%. For software cloud platforms, Microsoft Dynamics 365 ranks highest at 77%, followed by ServiceNow and Salesforce at 75%.
2024 Satisfaction
66%
2023 Satisfaction
77%
2024 Swiss IT Sourcing Study – Final Report
The 2024 final report encompasses the latest sourcing and governance trends for Switzerland. It includes rankings by six IT service towers, Key Performance Indicators spanning four dimensions, and cloud platform provider rankings. For further details, please contact info(@)whitelane.com.
