According to TPI's Index of the Outsourcing Industry, IT outsourcing (ITO) values were strong in the first Quarter of 2010, with $16 billion in ITO contract awards representing a 46% increase in total contract value when compared to Q1 2009. The BPO market, in contrast, was down 26% compared to the year-earlier quarter. TPI analysts believe outsourcing customers will continue to rely on ITO more than BPO this year.
The tough economy has affected the outsourcing industry, along with every other industry out there.
When Ann All wrote about outsourcing trends, citing information from IT services company CSC, she found the trends largely involved buyers deriving more value for their money. Instead of the traditional tactic of trying to negotiate the lowest possible prices, however, buyers are relying on more sophisticated techniques such as outcome-based pricing.
Ann spoke to several other sources, including Unisys, TPI, Everest Group and Compass Management Consulting, to get their takes on top outsourcing trends for the next year. They offered additional insights on the increased value theme, including buyers asking their suppliers for help in targeting internal inefficiencies and developing ideas for improvement.