Achieving your goals quickly is a difficult task for any business, but outsourcing can be an effective and inexpensive way to work towards them. However, you need to ensure that you choose the right outsourcing partner and talents for your business.
Nowadays, making any major business decisions without doing enough research is a big mistake. Try not to base decisions on a gut-feeling only; use logic, facts, and data to support your decisions for choosing an outsourcing partner.
By definition, outsourcing requires you to contract third party companies or entities to request that they perform various tasks for your business. A very good reason to outsource is to reduce day-to-day operational expenses. However, some companies also choose to outsource their business projects to meet their strategic goals.
Outsourcing Data and Statistics
You should research the latest data andstatistics about the outsourcing industry before you finalize any outsourcing decisionsfor your company.
Reasons to Outsource
A report from Deloitte in 2016, shows by %the most common reasons given as to why businesses chose to outsource:
59% – Reduce Costs.
57% – Ability to focus on more important tasks.
47% – To solve capacity problems.
31% – Improve the quality of service.
28% – To gain access to the best talent and skills.
17% – To manages the business.
17% – Improve the organization during periods of change.
Below is some information from the Global Outsourcing Industry between 2016 and 2018:
- Statista put the global market size for outsourced services in 2018 at $85.6 billion.
- 65% of companies outsourcing in 2017 planned to continue with this in 2019. (Outsourcing Insight)
- 37% of businesses want to outsource more of their application development projects. (IT Outsourcing Statistics 2017/2018)
- 84.2% of global outsourcing deals originated in the United States. (KPMG, 2017)
- Ukraine has the largest number of IT professionals working in Central and Eastern Europe. (Ukraine Digital News)
Data Outsourcing Trends for 2019
The demand for IT outsourcing will continueto rise as multiple organizations are taking advantage, rather than opting forin-house specialists. A number of IToutsourcing trends to be aware of in 2019 which will enable you to make moreinformed business decisions are:
1. Decreased Focus on Reducing Costs
Outsourcing used to always be about cost-cutting. However, many companies are now opting to outsource software development to enable them to access the most skilled workers.
Value and quality are becoming far moreimportant than cost alone.
2. Using Multiple and Specialized OutsourcingPartners
Most small companies are not lucky enough to have a fully equipped IT team to control their operations. These companies may opt to use IT services from multiple outsourcing vendors. They will form partnerships with such vendors who will be specialized in the areas the company requires assistance with. IT outsourcing is predicted to be increasingly about specialized services for the next few years.
An outsourcing company will have a hugevariety of skills under one roof. This willallow them to be competitive and stand out.
3. Alternative IT Outsourcing Countries
This is an emerging trend. According to the 2017 Statista report, India and China made about $150 billion from IT exports. However, talent is now emerging in counties such as Ukraine, Poland, Romania, and Belarus. Ukraine especially is turning into a major IT hub and the number of software developers is increasing rapidly.
4. New Contract Styles
Contract styles between IT serviceproviders and clients will grow and change as IT outsourcing becomesincreasingly value-driven and interpersonal. Contracts will be based on the results oroutcomes of previous projects. Deliverytimes will get shorter as there will be increased competition amongst theservice providers.
5. Outsourcing Essential Business Tasks
According to Global Industry Analytics, theglobal BPO market is expected to reach $220 billion by the year 2020. Clients will continue to outsource more essentialbusiness tasks to service providers. IToutsourcing vendors will become increasingly responsible for outcomes and workas partners to ensure effective IT solutions.
The Final Word
The previous statistics and industry trends should help you decide upon strategies to outsource your business tasks. Many companies have benefited from outsourcing and so can you. You just need to exert a little caution when hiring the services of an offshore vendor.
2020 looks to be a good year for all kinds of businesses and outsourcing agencies. If outsourcing trends continue in this way for a few more years, then this business model will become the norm. The trust built on all sides will enable both parties to grow their businesses. Remember to look for outsourcing partners who will bring the highest quality of services to your business.