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How Digital Transformation Is Helping Accenture

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Driving the consulting and outsourcing businesses

Accenture (ACN) continues to gain from the ongoing digital transformation trend. The availability of different forms of cloud technology, including SaaS (software-as-a-service), IaaS (infrastructure-as-a-service), and PaaS (platform-as-a-service), is creating huge opportunities for the company in different markets and industries in terms of higher consulting and outsourcing business.

After their data and applications move to the cloud, customers get full access to Accenture’s data analytics and AI technology support. In this way, Accenture drives the digital transformation phase of any company.

In the last five quarters, Accenture’s consulting and outsourcing businesses have improved at compound annual growth rates of 4.2% and 3.4%, respectively. In the graph above, we can see the business trends in the consulting and outsourcing businesses over the last five quarters.

In the fiscal third quarter, the consulting business generated YoY (year-over-year) revenue growth of 18% to $5.7 billion. At the same time, the outsourcing business generated $4.6 billion in revenue, up 14.4%.

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ERP business growth

Digital transformation is also bringing ERP (enterprise resource planning) to the cloud by adding new features, including analytics and AI. Hence, the digitization trend has increased the adoption of new ERP in different organizations. Both Amazon (AMZN) and Microsoft (MSFT) continue to dominate the cloud platform. Moreover, the wave of digital transition has brought many new opportunities for Accenture, including blockchain and Internet of Things technologies.

In the fiscal third quarter, the company won 13 orders worth more than $100 million. In the same quarter, Accenture also made record bookings of nearly $11.8 billion, up 20.3% YoY.

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