1. The Future of Business Process Outsourcing

2. The BPO Hype Cycle Source: Gartner Group, “The Hype Cycle for IT Services”, June 6, 2003. Rising investments Explosion in # of new entrants Market confusion Valuation spikes Market CAGR estimates range from 50% - 80% for the next five years

3. Long-Term Business Pressures Drive More Outsourcing

4. Moving Up the Value Chain Future Simple Processes Complex Processes Business Functions Source: Edelweiss Capital, “Business Process Outsourcing: Coming of Age?”, May 2003

5. The Evolution of BPO Models Transformational Onshore BPO Example: Sabre (Travel Services) Onshore Offshore Commodity BPOTransformational BPO Commodity Onshore BPO Example: CSC, EDS (IT Services) Commodity Offshore BPO Example: GE Capital (Payroll Services) Transformational Offshore BPO

6. Approaches to BPO Simple bulk transactions processing Broad shared services High-volume vertical processes Niche vertical apps Bottom-Up ApproachTop-Down Approach Source: Cognizant Analysis of Forrester Research Report: “BPO’s Fragmented Future”, August, 2003. Leverage: Economies of scale Labor arbitrage opportunities Industry best practices To Create: Best-of-breed commodity services Immediate cost savings Flawless process execution Growth Opportunity: Identify complex processes that require industry / domain expertise Build differentiated competencies that boost market position Leverage: Deep process expertise in vertical industries Trusted partner relationships and reputations To Create: Highly customized, industry- specific services Long-term differentiation / competitive advantage Growth Opportunity: Leverage outsourcing competency to reduce costs and boost performance throughout value chain Consider “retailing” services to competitors

7. Emerging Offshore BPO Opportunities Transaction processing Credit Card / Check processing Loan processing Mortgage processing Collections Insurance application processing Claims processing & adjudication Member management services Medical billing Claims processing & adjudication Member management services Medical transcription Banking / Financial Services InsuranceHealthcare R&D Equity Research Clinical Trials Revenue Accounting (Airlines) Engineering Design Architecture Other Verticals Sales and Marketing Contact centers, telesales/telemarketing, customer care, web sales and marketing, market analysis Human Resources Payroll processing, benefits administration, HR administration Finance and Accounting Accounts receivables / payables / general accounting, financial reporting, shareholder services

8. Possible BPO Structures Service Arrangement Joint Venture Outsourced Service Build Operate Transfer Service Management People & Investment Pros Cons Can get going quickly Lower client management overhead Higher ongoing P&L cost vs. alternatives Limited value creation potential for client Less control Eases entry into offshore operation with experienced partner Lower long-term cost Complete control Limited value creation (captive) No ownership Day 1 Retention Only 2nd tier partners Leverage partner’s offshore infrastructure and experience Ownership Day 1 Lower costs (initial and long-term) Limited value creation (captive) Leverage partner’s offshore infrastructure and experience Value creation opportunity (if non- captive) Exit issues

9. Offshoring and Reengineering Can Lead to Dramatic Performance Improvements

10. LOB Bank card processing/ receivables Telemarketing services Mutual fund services (FORMERLY AMEX INFORMATION SERVICES) Highlights Provides bank card processing, payment products for Mastercard, Visa, American Express, and numerous private-label cards Recent expansion in receivables management (American Creditors Bureau, Ingram) Provides inbound and outbound telemarketing services and, through joint venture with AT&T, interactive services for 800/900 telephone industry Manages the processing for 20 million mutual fund shareholder accounts Results 2002 Revenues: $7.636 billion 2002 Earnings: $1.238 billion AMEX sold 40 million shares (40% ownership) in early 1992 for $22/share; recently traded at $160/share (split-adjusted) AMEX further reduced stake to 22% through second offering worth approximately $1 billion in 1993 Acquired FFMC (August 1995) for expanded operation and greater economies of scale Finalizing acquisition of Concord EFS Source:FDC annual reports; industry articles; Datamation Opportunity for Value Creation - FDC

11. Cognizant’s Initial Approach Deep Process Experience Deep Industry Expertise Industry Value Chain Industry Competitive Forces Company Core Competencies Business Strategy Company Outsourcing Readiness Excellence in Offshore Recruiting/People, Processes/Infrastructure Excellence in Delivering High-quality Services Remotely Established Market Leader in the India Space ClientsCognizantJoint Analysis Transformational Outsourcing Strategic Outsourcing Decisions Highly Customized Service Offerings Long-term Competitive Advantage

12. Strategy To Drive BPO Decisions ScopeDiscoveryAnalysis Feasibility Assessment Inventory key business processes and current SLA parameters Catalog support technology platform requirements and skill sets of support staff Identify root drivers of process costs and inefficiencies Gather transaction volume data and model across processes Map underlying support systems Determine BPO structure model Identify pilot Determine resource requirements Identify changes to support process in onshore/offshore model Determine cost savings per business process based on task migration and improvement Identify costs of process migrations Identify any key sequencing needs Undertake a BPO strategy assessment to determine which processes to outsource, financial impact and implementation plan

13. Cognizant Service Offering Cognizant’s Business Technology Consulting Group in concert with its vertical practices, works with clients in BPO strategy engagements These engagements last from 8-12 weeks, depending upon scope typically deliver: An assessment of suitability of select business process outsourcing based on economics, integration with other processes, systems and skill requirements A step-by-step plan for creating a BPO operation that mitigates risk and provides senior management focused measures and controls for BPO management