economic boom was one of the major factors that drove boom in
outsourcing. Now, as economic decline rears its head, companies can
easily take fruit from their outsourcing plans in the wake of huge cost
Small businesses are even luckier within the outsourcing well-doing getting an access to the special knowledge of the market, which is why more and more small and mid businesses are trying to be involved in the latest approaches of outsourcing. And of course, IT companies outstrip the others.
Starting 1990s, the offshore outsourcing market took huge steps ahead, putting all the pros and cons on analysts and outsourcing statistics. So, statistics is maybe the most important element in working-out outsourcing prospects.
Many analysts tried to figure out the connection between economical processes and outsourcing and came to an assumption that the outsourcing existence wasn’t a random phenomenon.
Here is some statistics.
The IT market is the most profitable. It takes some 28% of the total outsourcing market. Non-programming market contains following figures: 15% of human resources market, 14% of sales and marketing outsourcing, 11% of and financial services outsourcing and some 32% for the rest.
Profits grow too feeding the companies with the hopes for growing revenues by an average of 11%.
IT offshore outsourcing figures, the main benefits of programming outsourcing were taken by India and Ireland with $11.3 billion and $14.4 billion respectively. India gained some $12 billion annually on IT outsourcing solutions. The US IT outsourcing market also attempts to get a piece of a pie with an annual growth rate of 14.4%.
The offshore outsourcing market figures provide us with quite optimistic outlook, don’t they? Still, risks remain. First, there are problems with geographical location of the outsourcing destination that include language problems such as accent, political changes, cultural contradictions etc. So, it makes sense to check out the statistics before choosing the destination of outsourcing. Some other issues comprise improper communication infrastructure, disaster recovery capacity, power generation capacity etc.
A lot of outsourced project has already been complied through past years thus now we can talk about what to expect from moving activities off-base meaning statistical economical kickback. When whole project from A to Z moved offshore by a large company it can expect 30% to 50% cost savings. Non the less effective is offshoring parts of project or smaller project, as well as small business processes and savings might be up to 40 percent in most cases.
Statistics shows that there are more and more companies that try to cut costs by using offshore outsourcing solutions. That makes workers from the US and other countries a bit anxious. Such countries as India, China and the Philippines now make profits from jobs exporting leading to increasing job loss over the world.
In turn other opinion is present: companies in USA, EU or any other country where offshoring is effective, are cutting their costs bying outsourced services. How do you think - where will those saved costs be invested? Predominantly they will be invested back into economy of ones country and into new jobs inside.
Still, companies should not hurry to sign long-term outsourcing deals, analysts say. No one is protected from the failure, they add, and even the most secure at the first glance offshore deals can go bad. Another moment is that in years such deals might become cheaper when Eastern Europian outsouring players are coming into market, thus leading to even more cost savings.
But the market is definitely worth seeking new options and solutions. Outsourcing can be exactly what you’ll get profit from. Think about it!