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At this point, almost half of their revenue (7.5/16B in Q1 2023 from the 10-Q filing) is for their outsourcing / "managed services" business. They expect half

At this point, almost half of their revenue (7.5/16B in Q1 2023 from the 10-Q filing) is for their outsourcing / "managed services" business. They expect half of the reduction to be in their non-billable corporate area. It's also fascinating to realize that their REVENUE per employee is ~85K USD.

Melingo 4y ago
No clue how this works. So everyone has to earn at least below 50k? I mean overhead cost, building rents and c level salaries?!
- Macha 4y ago
  Don't forget they're a large multinational. They have both employees and customers in lower income economies.
- pappler 4y ago
  About 10 years ago I worked with someone in Australia who was from India. He worked for Accenture in India as a programmer and earned around 180USD per month. So their profit for outsourced work can be a lot.
qsort 4y ago
> It's also fascinating to realize that their REVENUE per employee is ~85K USD. Is it me or this number is ridiculously awful? I work for a small firm that isn't even US-based and we are easily at multiples of that figure.
- turnsout 4y ago
  It's not good in absolute terms, but when you look at their headcount… wow
- mjr00 4y ago
  Part of the value prop of Accenture is that they employee inexpensive foreign labor. They have 300,000 employees in India alone[0]. If those people are working at $20,000 a year, that's 300,000 * 65,000 = $19.5 billion in yearly profit from those employees alone. And India is a relatively expensive country these days; their margins in Vietnam and Thailand are probably even greater. [0] https://timesofindia.indiatimes.com/business/india-business/accentures-india-employee-strength-rises-to-3-lakh/articleshow/91058669.cms https://timesofindia.indiatimes.com/business/india-business/...
  - seanmcdirmid 4y ago
    Vietnam maybe, but Thailand is a middle income country. India has an HDI of .63, Thailand is at .68 (China is at .76, the USA is at .92). Labor costs are only one part that detract from your margin, you also have to consider productivity (what are you getting for your costs) and overhead (what taxes/bribes/rents do you need to pay). It is really easy to set up in a developing country and lose money rather than make it.
    - mjr00 4y ago
      Right, and part of the "value" that Accenture brings is that it knows how to operate in these areas. It will send US-based managers to work with the foreign dev teams to, ahem, ensure productivity on projects where it matters (on many projects e.g. government contracts the output doesn't really matter), it knows the local bribes and customs companies need to follow to operate in the area.
    - alephnerd 4y ago
      Those Thailand numbers are way off. Thailand's HDI is 0.8 and expat salaries (at least at McK) in BKK were always Shanghai and Beijing adjacent (if not higher until the 2010s). Heck, a lot of Vietnamese prefer studying and working abroad in Thailand because salaries and development is higher than in VN and only the elite can afford to send their kids to VinUni or RMIT Saigon.
      - seanmcdirmid 4y ago
        Bangkok is an anomaly, these numbers are Thailand wide. I was surprised China passed Thailand in the last decade (given those numbers are country wide as well, Shanghai is going to be much higher than .76). Last time I looked 10 years ago, China was lower than Thailand, things change quickly. The original premise that Thailand is cheaper than India is definitely wrong, we both can probably agree on that.
        alephnerd 4y ago
        I'm using UN Data - https://hdr.undp.org/data-center/country-insights#/ranks https://hdr.undp.org/data-center/country-insights#/ranks I think the issue was Google Search's summarization algorithm parsed the wrong sentence in a non-verified website (I did the same search you did and recreated your issue). Also, the same thing holds for China as well. BKK =/= Thailand and Shanghai/Beijing/Tianjin =/= China as well. Not to mitigate the massive amount of development that China has seen the past 20 years, but Thailand's subregional development (measured via HDI) is very even - the poorest region (Isan) has a HDI of around 0.781 and the richest (BKK the prefecture, not the city) is around 0.839 in 2021. Compared to China outside of Tier 1 cities it's a significant difference (and on a separate note Ik Chinese policymakers have been looking into Thailand's anti-poverty policies to replicate them in Shaanxi)
- toyg 4y ago
  It's still likely 2-5x what the employee is paid. Not bad, at large scale.

Melingo 4y ago

No clue how this works. So everyone has to earn at least below 50k? I mean overhead cost, building rents and c level salaries?!

Macha 4y ago
Don't forget they're a large multinational. They have both employees and customers in lower income economies.
pappler 4y ago
About 10 years ago I worked with someone in Australia who was from India. He worked for Accenture in India as a programmer and earned around 180USD per month. So their profit for outsourced work can be a lot.

qsort 4y ago

> It's also fascinating to realize that their REVENUE per employee is ~85K USD. Is it me or this number is ridiculously awful? I work for a small firm that isn't even US-based and we are easily at multiples of that figure.

turnsout 4y ago
It's not good in absolute terms, but when you look at their headcount… wow
mjr00 4y ago
Part of the value prop of Accenture is that they employee inexpensive foreign labor. They have 300,000 employees in India alone[0]. If those people are working at $20,000 a year, that's 300,000 * 65,000 = $19.5 billion in yearly profit from those employees alone. And India is a relatively expensive country these days; their margins in Vietnam and Thailand are probably even greater. [0] https://timesofindia.indiatimes.com/business/india-business/accentures-india-employee-strength-rises-to-3-lakh/articleshow/91058669.cms https://timesofindia.indiatimes.com/business/india-business/...
- seanmcdirmid 4y ago
  Vietnam maybe, but Thailand is a middle income country. India has an HDI of .63, Thailand is at .68 (China is at .76, the USA is at .92). Labor costs are only one part that detract from your margin, you also have to consider productivity (what are you getting for your costs) and overhead (what taxes/bribes/rents do you need to pay). It is really easy to set up in a developing country and lose money rather than make it.
  - mjr00 4y ago
    Right, and part of the "value" that Accenture brings is that it knows how to operate in these areas. It will send US-based managers to work with the foreign dev teams to, ahem, ensure productivity on projects where it matters (on many projects e.g. government contracts the output doesn't really matter), it knows the local bribes and customs companies need to follow to operate in the area.
  - alephnerd 4y ago
    Those Thailand numbers are way off. Thailand's HDI is 0.8 and expat salaries (at least at McK) in BKK were always Shanghai and Beijing adjacent (if not higher until the 2010s). Heck, a lot of Vietnamese prefer studying and working abroad in Thailand because salaries and development is higher than in VN and only the elite can afford to send their kids to VinUni or RMIT Saigon.
    - seanmcdirmid 4y ago
      Bangkok is an anomaly, these numbers are Thailand wide. I was surprised China passed Thailand in the last decade (given those numbers are country wide as well, Shanghai is going to be much higher than .76). Last time I looked 10 years ago, China was lower than Thailand, things change quickly. The original premise that Thailand is cheaper than India is definitely wrong, we both can probably agree on that.
      - alephnerd 4y ago
        I'm using UN Data - https://hdr.undp.org/data-center/country-insights#/ranks https://hdr.undp.org/data-center/country-insights#/ranks I think the issue was Google Search's summarization algorithm parsed the wrong sentence in a non-verified website (I did the same search you did and recreated your issue). Also, the same thing holds for China as well. BKK =/= Thailand and Shanghai/Beijing/Tianjin =/= China as well. Not to mitigate the massive amount of development that China has seen the past 20 years, but Thailand's subregional development (measured via HDI) is very even - the poorest region (Isan) has a HDI of around 0.781 and the richest (BKK the prefecture, not the city) is around 0.839 in 2021. Compared to China outside of Tier 1 cities it's a significant difference (and on a separate note Ik Chinese policymakers have been looking into Thailand's anti-poverty policies to replicate them in Shaanxi)
toyg 4y ago
It's still likely 2-5x what the employee is paid. Not bad, at large scale.