Trends of Outsourcing
In 2020, the global IT outsourcing market was valued at USD 318.5 billion. Specialists forecast that 2026 it will reach USD 425.19 billion in 2026.
These data clearly show that IT outsourcing has become the new normal shaping the business world. At the same time, thanks to the digital revolution that is happening before our eyes, the IT industry has a massive impact on the success of other enterprises. Outsourcing is no longer just a simple solution to reduce costs. Through modern technologies such asartificial intelligence or augmented reality, creativity, and a focus on high quality, outsourcing has become a source of competitive advantage for many enterprises.
Trends of Outsourcing
In this article, we've collected the latest outsourcing trends you need to know to create a great mobile app or website that will make you successful. The following trends will affect the entire outsourcing industry in the next few years.
Central & Eastern Europe as the Main Direction of Outsourcing
So far, the largest share in global revenues from outsourcing has been generated in the Asia region, where India and China were in the lead. However, this trend is changing as the countries of Central and Eastern Europe are systematically gaining popularity as hub outsourcing providers. It is supported by factors such as access to qualified personnel, lower operating costs, and a favorable location near Western European markets.
Compared to the countries of Central and Eastern Europe, Poland stands out significantly, becoming a power in the field of software development outsourcing for several years. It is due not only to Poland's ideal geographical location in Europe but also to the fact that Polish developers are among the world's top developers, and Poland focuses on technological development. Of course, high quality of work and lack of communication barriers are also important. Our article "Why Choose Outsourcing to Poland?" describes the benefits of outsourcing to Poland in detail.
Experts predict that the role of Central and Eastern European countries in outsourcing services will continue to increase systematically.
Development of Offshore Outsourcing
Over the past few years, there has been a clear trend toward favoring nearshore outsourcing. This trend's popularity resulted primarily from companies that started their adventure with outsourcing, choosing an external company from the same country to cooperate with because it was erroneously believed that this solution was safer.
However, offshore outsourcing is a cheaper solution than nearshore. Therefore, when companies must reduce operating costs to gain a competitive advantage, the development of offshore outsourcing will be a constant trend. Offshoring projects are safe and characterized by high quality and meeting users' expectations. In addition, many companies have found that offshore is a convenient solution and outsource most outsourced services in the offshoring model.
You can learn more about offshore outsourcing in our article "Offshoring your project - why is it worth it?".
Business Process Outsourcing
Business process outsourcing (BPO) is one of the fastest-growing industries in the world. In 2019, Grand View Research predicted that the global BPO market could exceed $343 billion by 2026.
BPO means entrusting the implementation of business processes to external companies and the assumption of responsibility for implementing these processes by these companies. Companies are resigning from the independent implementation of some less-critical business processes to focus on more critical aspects of the organization's operation. Outsourcing business processes is a good solution for activities that are performed in the same or similar way in different companies, such as payroll or accounting.
BPO enables companies to gain a competitive advantage by increasing their flexibility and adaptability, reducing operating costs, and allowing them to focus on key business tasks. For this reason, more and more companies have decided to outsource certain business functions.
Ensuring Business Continuity
Today, many companies choose a single outsourcing partner who deals with all projects and business processes to ensure business continuity. It ensures a stable service, free from interference.
Changing the Model of Cooperation
Focusing on ensuring business continuity somehow forced a change in the cooperation model with outsourcing companies. Clients want to work with one, not many external companies. It made the outsourcing company a business partner and only a service provider.
The IT outsourcing industry will not only be more and more partnership-based but also more and more competitive. Customers are looking for a trusted business partner who will know numerous processes, the latest technologies, and trends and, at the same time, will be an objective advisor during the implementation of a given project. Our article "Choosing the right software partner" discussed the key points to consider when choosing an outsourcing partner. The cooperation model based on partnership and trust is a new outsourcing trend that will undoubtedly impact the development of the outsourcing market.
Cybersecurity is a process aimed at protecting companies' data and internal systems against threats posed by cyberattacks. Implementation of appropriate procedures in this area allows you to prevent the effects of cybercriminals' activities that can cause a lot of damage to the organization.
The consequences of cyberattacks are most often manifested in the leakage of confidential data or theft. The activities of criminals can also affect the stability of IT systems and even cause long-term damage. It has a negative impact on all procedures, regardless of the nature of the organization. Both large corporations and startups severely feel the effects of cyberattacks.
No wonder the issue of cybersecurity is also crucial in the outsourcing industry. Outsourcing companies must do everything to ensure the security of the data they receive from their clients and that the software they create complies with all the recommendations of security specialists. The innovative service provider implements a multi-level approach to security issues to eliminate threats, protect business data, meet compliance standards, and scale operations.
Outsourcing companies that will ensure data security will gain a competitive advantage.
Robotic Process Automation
Robotic Process Automation (RPA) is a technology that automates structured, repetitive and routine business activities that humans previously performed. It allows companies to save costs, offers better quality, and simultaneously reduces the time to implement various solutions. Thanks to this, the company is more flexible and has more resources to implement other critical projects for the organization. The trend related to Robotic Process Automation is not new. RPA has been consistently developing for several years, and more and more external companies specialize in this technology.
Augmented Reality has been surprising for several years, with unconventional ideas to enrich the real world. AR is growing rapidly as it gives companies a competitive advantage. There is probably no industry in which this solution could not be used. External companies have also noticed the potential of this technology and therefore follow this trend by gathering experts specializing in this area around them.
Experts believe that artificial intelligence will significantly change how companies operate in the next few years. AI can help in almost every aspect of the business. Still, its potential can be best used in three critical business areas: automating processes, gaining information through data analytics, and connecting with customers.
The use of artificial intelligence is wide, and therefore, this trend will develop dynamically. Because creating innovative solutions using AI requires specialist knowledge, outsourcing companies will deal with this type of project, as they have access to an unlimited pool of talent.
These trends will shape the outsourcing industry for the next few years. Due to the development of technology and innovative solutions, outsourcing will also become the norm for small and medium-sized companies and for startups that have to fight to gain a competitive advantage in a crowded market.
If you are wondering how to implement the above outsourcing trends in your business, make an appointment for afree consultation with our specialists at a convenient time. As an offshore outsourcing company, we have been creating great software products for many years, and we love to share our knowledge and experience.