11 Outsourcing Trends for 2011

Posted on January 13, 2011

The global outsourcing market has witnessed major changes during the past few years. Based on these changes, outsourcing professionals and industry leaders have made a few predictions as to what the trends will be in 2011. Here is a quick look at the top 11 outsourcing trends predicted for this year

1. Increased Political Acceptance for Outsourcing

Greater political backing for outsourcing is expected in 2011, especially after US President Barack Obama’s visit to India in Nov 2010.

2. Sourcing from All Shores Including Domestic

2011 will see an increase in multi-sourcing arrangements. This trend is the result of socio-economic pressures on leading countries and economic incentives provided by local and federal governments to encourage employment.

3. Continued Revenue Growth

IAOP’s Global Outsourcing data reported a 10 percent growth in the revenue of outsourcing service providers in the year 2010. This growth is expected to continue in the coming year.

4. Emergence of a Latin American Outsourcing Boom

Industry experts predict the emergence of a Latin American outsourcing boom especially in Brazil, Mexico, Chile, Colombia, Costa Rica and Peru.

5. Merging of Cloudsourcing with Outsourcing

Cloudsourcing, which has often been predicted as the death of outsourcing, will soon merge with the existing outsourcing market and provide better opportunities for the entire industry.

6. Innovative Partnerships and Consolidation

More cross-border partnerships are expected in 2011 as cash-rich provider firms from developing nations are more than willing to invest in mid-market domestic provider firms in the US.

7. Emergence of a Retail Model in Outsourcing

Some experts predict the emergence of a retail model in the outsourcing industry where service providers will be categorized into large operations offering reduced costs and middle and lower-sized providers providing more customized services.

8. Outsourcing of Multiple Functions with Fewer Vendors

The new year will experience more and more companies coming up with comprehensive strategic plans that combine multiple processes in their outsourcing initiatives rather than outsourcing single processes or functions on a stand-alone basis.

9. Increase in Mass Automation of Services

With the huge pressure to keep costs down, service providers will rely more heavily on mass automation tools that will create additional opportunities and reduce the staff necessary to support critical business applications.

10. New Mergers and Accusations

2011 will pave the way for mergers between major Indian IT service providers and U.S.-based outsourcers, with Indian companies on the buying end.

11. Stabilization of Prices

Pricing structures will become more stable this year and vendors will have to woo clients with performance rather than a low bids.

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