Whether a new contract or renewal of an old one, Accenture’s (ACN) business flow remains intact. The most recent announcement relates to a contract renewal by the Japan Pension Service, under which Accenture will continue to provide management support to improve the accuracy of the Japanese agency’s pension records up to March 31, 2013.
The project entails reconciling 1.2 billion paper records processed by the Japan Pension Service, which currently manages 300 million computer records. The national project involves 29 centers and 18,000 staff throughout Japan. The consulting and technology major has been instrumental in providing management support for the project since March 2010, to help the government complete this task in four years.
Apart from this, Accenture’s service has been recently selected by India’s Department of Electronics & Information Technology. Per the contract, Accenture will develop a program whereby the government agency could compare details of technology providers and investors vying to develop a semiconductor facility in India. With the help of the tailor-made system, the agency will be able to choose the best firm for handling the task.
Accenture’s comprehensive service offerings have made it one of the key IT service providers. A large product and service base has also lent the company an edge in theis competitive market.
Accenture has regularly won deals from all industrial sectors as well as several federal agencies.
Its solutions and services range from business architecture consulting, systems integration, enterprise architecture and solutions at one end of the spectrum, to customer relationship management (CRM) and other BPO services at the other end. The range of service offerings especially with the focus on consulting and outsourcing helps the company to maintain steady growth in its revenue and margins, while insulating it from direct competition in any particular area.
In the recent past, however, demand has taken a hit due to the uncertain global economic environment. However, cost reduction is a major cause for concern for the companies across the globe, which helps in growing the bottom line. This apart, Accenture is helping companies to improve productivity and providing customer satisfaction and these remain the key focus areas for Accenture.
Though Accenture’s deal prospects look bright, the huge number of government deals (which carry low margins), stiff competition from IBM Corp. (IBM) and significant European exposure may temper its growth going forward.
Currently, Accenture has a short-term Hold rating, denoted by the Zacks #3 Rank.
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