EquaTerra, a global sourcing advisory firm with expertise in information technology (IT), finance, human resources and other business processes, has conducted research for Computer Weekly readers that analyses the market and trends for IT outsourcing in Western Europe. The report is taken from EquaTerra's global business and information technology pulse survey, a quarterly survey of leading outsourcing service providers and EquaTerra’s own client-facing advisors.
Some of the findings of the report are:
Demand growth for BPO and ITO slips slightly in 2Q10. Inherent outsourcing demand remains positive and is growing overall but still many buyers remain cautious in their efforts, especially what concerns upfront investments and complex deal arrangements.
Significant challenges for the providers are improving existing contract profitability and expanding scope with existing clients. Demand for non-outsourcing services like consulting and packaged software services is still weak. Providers cite long-term opportunities to make money from buyers’ cloud computing initiatives but it is unclear which providers will benefit the most and how much these new revenue streams will offset declining traditional systems integration work and potentially the loss of some traditional outsourcing business.
Buyers continue their efforts to reduce operating costs and overhaul service delivery models, with internal process improvement and alternative delivery models like shared services gaining in importance as change agents. Interest in cloud-based services such as SaaS is gaining traction.
The use of multi-sourcing or multiple outsourcing service providers in adjacent and complementary functional areas continues to grow. The growth of cloud computing opportunities to complement, extend, and in some cases supplant traditional outsourcing will further drive more multi-sourcing, at least in the short to medium term, as new service providers come to market.
Source: ComputerWeekly
Some of the findings of the report are:
Demand growth for BPO and ITO slips slightly in 2Q10. Inherent outsourcing demand remains positive and is growing overall but still many buyers remain cautious in their efforts, especially what concerns upfront investments and complex deal arrangements.
Significant challenges for the providers are improving existing contract profitability and expanding scope with existing clients. Demand for non-outsourcing services like consulting and packaged software services is still weak. Providers cite long-term opportunities to make money from buyers’ cloud computing initiatives but it is unclear which providers will benefit the most and how much these new revenue streams will offset declining traditional systems integration work and potentially the loss of some traditional outsourcing business.
Buyers continue their efforts to reduce operating costs and overhaul service delivery models, with internal process improvement and alternative delivery models like shared services gaining in importance as change agents. Interest in cloud-based services such as SaaS is gaining traction.
The use of multi-sourcing or multiple outsourcing service providers in adjacent and complementary functional areas continues to grow. The growth of cloud computing opportunities to complement, extend, and in some cases supplant traditional outsourcing will further drive more multi-sourcing, at least in the short to medium term, as new service providers come to market.
Source: ComputerWeekly
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