Outsourcing Trends 2020 – An Expert’s Insights?
The entire gamut of business sourcing and outsourcing trends is undergoing rapid transformation leading to widespread speculations with regards to its future shape. Connectivity has created bridges across impregnable business dimensions and technology is making forays into core management issues hitherto unheard of. Outsourcing trends for 2020 is a peep into the future through the prism of change that global businesses are currently experiencing.
Sweeping Outsourcing Trends of Today
Several new and innovative technologies and processes are defining the direction of outsourcing in the current business scenario.
- Outsourcing in the West is set to reverse its direction given the trends of rising wages and production costs in traditional destinations like India and China.
- The true power of Cloud is being gradually understood and exploited which will have far reaching consequences for outsourcing the years to come.
- The advent of Internet of Things which is a concept that promises to provide limitless connectivity will boost the performance capabilities of the BPOs across the globe.
- Big Data Analytics will have an influence on the way businesses look at outsourcing process. The use of enterprise data centers to manage huge volumes of data is being predicted to rise by 14 times by 2020.
- Outsourcing is rapidly becoming an integral part of every boardroom strategy as more and more business functions gain outsourcing ability.
Environmental Factors affecting Outsourcing
With businesses looking forward for sustainable acceleration more and more complex functions are being outsourced. Even the trend of outsourcing Core functions has found widespread acceptance in the recent times with immense scope of growth in the future. The 3 defining environmental factors which will have a profound effect on the outsourcing trends in 202 are:
- Digital convergence which is resulting in the coalescence of disparate industries into Giant Industries of the future. This implies that with increased interdependence there will be greater demand for super specialization that favors outsourcing.
- Financial convergence as institutions with varied interest combines their prowess and efforts for capturing more of the available market space through integrated policies. The surest outcome of such convergence in increased reliance on outsourced services which will be the backbone of the combined efforts.
- Regulatory convergence as governments across the globe make joint efforts to avoid economic instability or market volatility witnessed in the last decade. Transparent global standards will ensure better compliance from the outsource partners from any corner of the world.
From Service Vendor to Strategic Partner
The outsourced service provider shall steadily become integral to success of any business thus transforming into a real partner for growth by the end of the present decade. The new role for the existing vendor shall encompass the following:
- Will have to enter into signed arrangement with the outsourcer to provide embedded participation.
- Shall have to provide end to end business solutions typical to the outsourcer’s needs.
- Will need to focus on the actual customer satisfaction and sales strategy of the outsourcer rather than mere supplying of goods and services.
- Will have to undertake widespread and proactive innovation in all outsourced processes in order to retain competitive edge.
- Will have to integrate into key decision making processes so as to progress from mere knowledge based decision to more judgment and analysis based decisions that will have long term impact on the business plans of both parties.
- Synergize efforts to a level of profit and risk sharing partnership with the outsourcer in a seamlessly integrated process.
Outsourcing Trends – 2020
A few unexpected surprises are in store for the entire outsourcing community in the years to come. The 3 noticeable and paradigm shift in the way outsourcing has been conducted so far include:
- Core as well as noncore functions outsourcing as the reliability of systems increase. So far most outsourcing was limited to non core functions as businesses were wary about security issues.
- Skill specific outsourcing will be the mantra as the era of super specialization dawns on global businesses.
- Reverse outsourcing where the form may be offshore with domestic employees will be the norm of the day.
It will indeed be an interesting space to watch in the years to come as outsourcing trends emerge in the changed geopolitical and economic equations between the developed and developing nations.