Julie Sweet
Chair and Chief Executive Officer at Accenture
Thank you, KC. We remain laser-focused on staying close to our clients, advising them how to navigate the macro, providing the right solutions to enable compressed transformations and adjusting to their changing needs.
Let me give some further color on what we're seeing in the market and how we see the demand environment shaping up. Over the last quarter, as we can all read, the economic estimates for 2023 continue to decline. While the latest industry estimates for 2023's technology spending continue to show robust growth of 5% or so, we will see how the market evolves as clients finalize 2023 budgets.
So what does today's market mean for our clients? We believe that the current macro is making it even clearer to clients that they need to change more, not less, and that two of the five key forces of change that we have identified for the next decade: the need for total enterprise reinvention enabled by tech, data and AI; and the ability to access, create and unlock the potential of talent, are critical to succeed in the near, medium and long-term. We see this continuing across industries and markets with two common themes.
First, all strategies continue to lead to technology, particularly cloud, data, AI and security. And second, companies remain focused on executing compressed transformation to achieve lower costs, stronger growth, more agility and greater resilience faster. What does this mean for Accenture? Our strategy positions us for continued industry leadership because we have a unique set of strengths our clients need to navigate today and succeed tomorrow. We are able to do so because of our deep strategy and consulting expertise across industries, allowing us to be a trusted advisor during different economic cycles because we bring the expertise coupled with the real-life practical experience they need.
Our ability to help clients achieve total enterprise reinvention through our depth across the enterprise from the frontline core operations to corporate functions as well as our ability to advise our clients shape and deliver value-led transformations and through our breadth of services from strategy and consulting to our strategic managed services, which help clients digitize faster, access talent and lower costs. And our global footprint allows us to act at scale and with speed. Together, this positions us as the compressed transformation partner of choice as you can see in yet another strong quarter of clients who selected us for work of more than $100 million this quarter.
I am pleased to see how quickly we are pivoting to meet the evolving needs of our clients. We have seen a higher level of sales and pipeline coming from cost-focused initiatives, often also including growth of capability enhancements. We are leveraging our breadth of services, deep client and ecosystem relationships and industry and functional expertise to help our clients and Accenture shift to the highest value opportunities, our track record of delivery at speed and scale over many years with clients. Remember 99 of our top 100 clients have been with us for over 10 years. This gives our clients confidence that by partnering with us, they will deliver on their commitments.
Investments in our assets and solutions such as myWizard and SynOps, which underlie both strategy and consulting, technology and operations managed services, as well as our delivery of compressed transformations, enables us to differentiate with our insights and services.
Our ability to invest in acquisitions helps us to expand our relevance across the enterprise from building a digital core with Sentia and ALBERT to optimizing operations to achieve agility, efficiency and resilience with Stellantis, to accelerating their growth agendas with Song. And our substantial investment in the skills of our people allows us to pivot to new areas of demand to be an attractive destination for top talent.
Now let's turn to the quarter. To bring to life this demand environment across the five key forces of change for our clients: total enterprise reinvention, talent, sustainability, the metaverse and the ongoing tech revolution, which in turn drove our growth. First, total enterprise reinvention. We continue to help our clients achieve a new performance frontier by building their digital core, optimizing operations and accelerating growth, leveraging cloud, data and AI and new ways of workings. We are helping Roche, a Swiss multinational healthcare company specializing in pharmaceuticals and diagnostics for the total enterprise reinvention, building a digital infrastructure to match changing business needs. Using data integration, we have changed the way tumor boards are organized and conducted empowering counter teams to be more efficient and effective in determining next steps for cancer care. And we have built a digital ecosystem that will create innovative product solutions to drive diabetes care.
Now as part of one of the largest ERP modernizations in the world, we are working together to deploy a digital backbone that will unify and harmonize nearly 700 business processes for more than 100,000 end-users. The integrated platform will simplify the system landscape and connect activities across the value chain from R&D and manufacturing to patient treatment.
Cloud, a $26 billion business in FY '22 grew 48% with even stronger growth in Cloud First, and continues to grow very strong double digits. In fact, we believe that the cloud continuum will become the new operating system for the future enterprise. Migrating to the cloud to drive efficiencies, is just the first step. As we anticipated with our Cloud First strategy and investments, we are seeing our clients make significant investments to modernize, improve and innovate in the cloud, leveraging data and AI to drive new business value.
For example, Accenture Federal Services is partnering with the Centers for Disease Control and Prevention, a U.S. federal agency under the Department of Health and Human Services, to accelerate its migration to the cloud across the enterprise and modernize its IT portfolio. Through this work, we will also help to achieve CDC's mission to protect people from health, safety and security threats by supporting the development of integrated real-time public health data and surveillance systems.
As our clients build a digital core, security continues to be more important than ever, as reflected in our very strong double-digit growth in Q1. We are expanding our cyber security footprint for a large healthcare network in Brazil to elevate their cyber security posture to a new level of preparedness. We are growing the organization's security profile with a cyber-as-a-service solution that will enhance the cyber readiness of their infrastructure and operations. This new project not only consolidates the work that up to four different providers typically do, it also is the largest cyber security contract ever signed in Brazil by any provider.
High demand for our strategic managed services, reflecting $7.3 billion in revenue and 20% growth in the quarter demonstrates the importance of these services to our clients' strategies as it enables clients to move faster, leveraging our digital platforms, expertise and talent. Our managed services are differentiated by our ability to bring in our deep expertise from across the enterprise, including Song, which grew double-digits in the first quarter.
For example, we are expanding our partnership with Allianz [Phonetic], an Italian main bank of Allianz Group to continue the bank's digital transformation with a new platform in the cloud, a modern IT architecture and a new operating model. Our Song team is helping to create a new customer mobile app to improve customer experience. And our end-to-end managed services capabilities tailored to the financial services industry will help the bank grow and scale its position in the market, ensure regulatory compliance and lower total cost of ownership.
We continue to see strong demand for our Industry X capabilities, digitizing, engineering and manufacturing, which we see is the next digital frontier with continued very strong double-digit growth in Q1. We are helping Celanese, a global chemical and specialty materials company on their digital transformation journey. They will increase their manufacturing production resiliency, productivity and predictability of plant operations. We're teaming with ecosystem partners to design and implement a scalable digital twin platform at one of their largest manufacturing facilities, which plans to increase revenues through increased plant output, reduced costs and improved productivity, product quality and equipment reliability and improve overall safety in the workplace. We also are supporting an enterprise cloud transformation to provide a scalable platform for future enterprise growth and innovation.
Next, talent. Our clients continue to look to us to access, create and unlock talent as a critical element of their transformations. We are helping a global chemical manufacturer with an end-to-end IT transformation as part of their multi-year digital journey. The company faces increasing IT costs, aging assets and tools and over-reliance on contractors. We're implementing a full managed services model that will help modernize its IT and the digital transformation includes a talent transformation. Together, we will upskill their people in data, cloud and AI through our Accenture Academy so that everyone grows together, helping the company leapfrog its competitors with innovative industry-leading solutions.
Now, sustainability. We continue to prioritize embedding sustainability into our clients' digital transformations and on providing a direct sustainability service. For example, we are expanding our partnership with the European multinational Aerospace Corporation to help improve their environmental and social impacts across the enterprise. In recent years, we have worked together to digitize the company's supply chain and manufacturing operations using a digital twin to improve productivity and reduce waste. Now we are working together to advance their sustainability agenda. We're supporting their aviation decarbonization roadmap from accelerating the use of sustainable aviation fuel to helping design low emissions aircraft. We are finding new ways to help make the supply chain more transparent and ethical, helping the company replace hazardous materials from the product life cycle with safer, greener alternatives. And we are outlining a strategy to help them meet its net zero targets and internally foster a culture that is focused on sustainability.
Finally, the metaverse and the ongoing tech revolution. While still in the early innings, we believe the metaverse will not only change how people work, but it will also profoundly change every part of every business from how we interact with customers with products and services they offer, how they are made and distributed, how you engage with your people from employee onboarding to personnel productivity. We're partnering with NTT DOCOMO, a Japanese mobile operator, to speed up the adoption of Web3, a new blockchain-based version of the Internet that promises a digital economy with greater social impact. We will develop and grow a secure technology platform for Web3 which will enable new products, services and community building. Training will ensure that Web3 engineers and business leaders collaborate with organizations effectively and securely on the platform. NTT DOCOMO's work on societal issues will now expand with the use of Web3, helping companies and governments transform social infrastructures and provide solutions that would improve people's lives. We continue to invest ahead of our clients into the future with a keen focus on innovation and the ongoing tech revolution.
Back to you, KC.