Acquisitions and alliances: How Accenture is building an AI arsenal

Accenture is building up artificial intelligence (AI) expertise through accelerated acquisitions and advanced alliances, maximising ecosystem expertise in an attempt to assume a position of market authority.

As the dust settles on plans to invest $3 billion over three years in its Data & AI practice, a clear framework is emerging as the global system integrator (GSI) unveils the foundational specialisation required to realise AI ambitions.

In short, Accenture will invest in assets, industry solutions, ventures, acquisitions, talent and ecosystem partnerships – all designed to deepen and develop new skills and capabilities across diagnostic, predictive and generative AI.

“There is unprecedented interest in all areas of AI, and the substantial investment we are making in our Data & AI practice will help our clients move from interest to action to value, and in a responsible way with clear business cases,” said Julie Sweet, CEO of Accenture.

But upon closer examination, two key pillars stand out as mission-critical in achieving future AI success – acquisitions and alliances.

Expertise via acquisition

With Accenture already considered a naturally acquisitive company, the GSI is deploying the same strategy to boost AI capabilities at speed – evidenced by a continuous commitment to purchasing technology providers across the world, with a notable focus on Asia Pacific.

For example, the recent acquisition of Flutura – an industrial AI specialist based in Bangalore, India – was completed 10 days after the AI investment announcement.

Flutura is designed to help increase the performance of plants, refineries and supply chains while also enabling customers to accomplish net zero goals faster. Plans are also in place to offer Flutura’s capabilities to energy, chemicals, metals, mining and pharmaceutical industries.

The deal will result in the addition of approximately 110 professionals who specialise in industrial data science services for manufacturers and other asset-intensive companies, supported by an AI platform that provides self-service solutions for advanced analytics.

Weeks before closing Flutura, Accenture also snapped up Nextira – an Amazon Web Services (AWS) Premier Partner that delivers cloud-native innovation and predictive analytics for customers.

Focusing on media and entertainment industry clients, the US-based specialist will expand engineering capabilities specific to AI and machine learning, adding almost 70 employees to the Accenture AWS Business Group.

Other key acquisitions include data science provider, Albert, in Tokyo, Japan (November 2022) and big data and analytics consultancy, Analytics8, in Sydney, Australia (August 2019).

AI and analytics provider, Bridgei2i, was snapped up in Bengaluru, India (November 2021) and automated insights and big data specialists, Byte Prophecy, was purchased in Ahmedabad, India (May 2020).

Beyond the borders of Asia Pacific, other key acquisitions designed to strengthen data and AI capabilities include Sentelis in France (July 2020), Pragsis Bidoop in Spain (September 2019) and Mudano in the UK (February 2020).

This is alongside US-based buyouts in the form of Clarity Insights (January 2020), End-to-End Analytics (December 2020) and Core Compete (April 2021).

Expertise via alliances

Within the space of five years, Accenture has progressed from a $40 billion company in 2018 to now commanding annual revenue of more than $63 billion in 2023.

Central to such success is an alliance ecosystem which currently generates 50% of the company’s business, up from 25% in 2018.

On paper, the GSI adopts a technology-agnostic strategy by representing over 200 alliance partners in market, whether tier-1 vendors or niche providers. But if pressed, the top strategic partners include Microsoft, AWS, Google Cloud, Salesforce, Oracle and SAP, in addition to Workday, ServiceNow, Adobe and IBM.

“Accelerated adoption of generative AI in portfolio development and service delivery will force Accenture to align the company’s expectations with its partners’ sales and go-to-market motions,” said Bozhidar Hristov, Principal Analyst at Technology Business Research.

“Accenture will increasingly rely on standardised offerings to move into the mid-market and upper-mid-market spaces, thus creating opportunities for smaller vendors to partner with the company.”

Eight days after unveiling AI investment plans, Accenture simultaneously shared deepened commitments with Microsoft, AWS and Google Cloud – increasing alignment with the three leading hyperscalers in the market.

Accenture and Microsoft are leveraging the joint venture capabilities of Avanade to co-develop new AI-powered industry and functional solutions, powered by Microsoft Azure, Azure OpenAI Service and Microsoft 365 Copilot.

An expanded AWS brief includes helping customers maximise the value of large language models (LLMs) and generative AI for accelerated business transformation, driven by Amazon Bedrock, Amazon Titan and Amazon SageMaker.

Meanwhile, Google Cloud will provide AI products such as Vertex AI and Generative AI App to guide organisations on the optimal use of generative AI.

All three partnerships will help the GSI enhance AI capabilities specific to financial services, healthcare and supply chain industries, in addition to strengthening contact centre and security offerings.

“Vendors seeking to capture Accenture’s attention can approach the company by taking on additional risk and investing – from both a human and financial standpoint – in establishing business groups,” Hristov advised. “These relationships are often set through top-down executive and management oversight.”

Beyond acquisitions and alliances

From an internal standpoint, Accenture has embedded AI across its entire service delivery approach, driving efficiency and insights through platforms such as myWizard, SynOps and MyNav.

Also in market is the new AI Navigator for Enterprise, a generative AI-based platform designed to help customers define business cases, make decisions, navigate AI journeys, choose architectures and understand algorithms and models.

“Companies that build a strong foundation of AI by adopting and scaling it now, where the technology is mature and delivers clear value, will be better positioned to reinvent, compete and achieve new levels of performance,” Sweet added.

“Our clients have complex environments, and at a time when the technology is changing rapidly, our deep understanding of ecosystem solutions allows us to help them navigate quickly and cost effectively to make smart decisions.”

Specific to skills, Accenture currently houses more than 40,000 employees focused on AI projects, supported by 9,000 data experts across specific industries and domains. As part of the GSI’s three-year strategy, plans are in place double AI talent to 80,000 people through “hiring, acquisitions and training”.

Such talent will leverage over 50 dedicated centres globally, designed to provide extensive research and development (R&D) investment to overhaul service delivery using generative and other emerging AI capabilities.

Accelerators will be created to promote data and AI readiness across 19 industry verticals, leveraging more than 1,450 patents (granted and pending) and over 300 applications and solutions.