IT outsourcing is a big industry expanding at a fast rate, and according to statistics, the value of the outsourcing sector is equivalent to Austria’s, Norway’s or Argentina`s GDP. It is supposed that this sector will reach $450 billion in revenues by the end of 2015. This estimated revenue is based on the fact that governments offer incentives to private businesses in emerging markets to develop outsourcing capabilities and thus promote local economic growth and attract foreign investors.
Outsourcing is considered a potent business model that involves fundamental aspects of how an organization is structured and managed and how it adds value to staff, customers and stakeholders. Small and medium-sized companies are increasingly penetrating the outsourcing space and companies located in Eastern Europe are among the most sought after in software development outsourcing. The benefits they offer include cost advantages, specialized workforce, convenient time zone and location.
Analysts and experts in IT outsourcing consider that traditional outsourcing will still account for the bulk of expenditures in future, but organizations will bring more IT back in-house as they are increasingly cautious about outsourcing too much of their IT talent. Also, long term outsourcing agreements of over seven years will be reduced to no more than five years.
In the near future more providers are expected to offer niche services and customers will become increasingly selective with their providers, taking many aspects into consideration before outsourcing big projects.
A strong growth is forecasted for the outsourced support for mobile end user devices due to the increased enterprise adoption of mobile devices like smart phones, tablets and other hand held devices. IT outsourcing companies from emerging markets in Asia, the Pacific, Latin America and China will register growths of approximately 13% in 2014. The IT outsourcing sector of 2013 is limited by the economic conditions and the cost-focused buyers, who limit the growth potential of the sector.
The future success of the IT outsourcing sector will sometimes require new forms of partnerships, new ways to deliver outcomes and to build trust and credibility between the clients and the providers.