Los Angeles, Aug. 26, 2022 (GLOBE NEWSWIRE) -- Recently announced report on “IT Services Outsourcing Market - Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2022-2030”.
Regional Snapshots
The Asia Pacific region is expected to have the largest market share in the coming years due to a large amount of outsourcing done in these regions. China and India are the most preferred destinations for the outsourced work. Most of the companies that are based in the United States find India and China extremely attractive for outsourcing they are functions as these nations provide cost effective solutions and the presence of talented workforce is expected to drive the market growth in the coming years.
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When it comes to China it shall provide better opportunities in the future as it is more cost effective as compared to India. The revenue generated through the outsourced work has been extremely beneficial in improving the economy of this region. Even though this region is extremely efficient in manufacturing many products due to the availability of cheap labor in the coming years it shall be and outsourcing hub for the IT related functions. From the past 25 years India has dominated the outsourcing market. This region has a lot of outsourced work and it happens to be a preferred destination by most of the companies situated across the globe. There is a growing demand for developing various softwares and it is expected to grow in the coming years period
Other regions that are preferred for the outsourced work are Japan, Vietnam as well as Indonesia.
Key Takeaways:
- In 2021, the off-shore segment has accounted market share of around 52%.
- In 2021, the on-shore segment has generated 48% market share.
- North America region has contributed 42% market share in 2021.
- Asia Pacific region has reached 36% market share in 2021.
Report Highlights
- The banking and finance segment will dominate the market in the coming years due to an increased amount of investments which are done by these industries for increasing the automation. The ecommerce and retail segment is also expected to grow well during the forecast period due to the entry of various startups. Increased use of virtual reality and artificial intelligence in the retail and online platforms will drive the market growth. There is a growing demand for software that will be beneficial for the health care providers. There is a growing demand for software applications for the medical industry.
- The offshore segment will grow well during the forecast. As it provides benefits in terms of cost and it also helps in providing talented workforce. Many companies prefer the countries in the Asia Pacific region for outsourcing their work. In the coming years the demand for onshore segment value grow as it provides many benefits of effective communication and the operation in the same time zone. As the out sorcerer and the vendor is located in the same country these two forms or under the same rule which happens to be a major driving force.
- On the basis of the service the application business segment will grow well during the forecast period. There's been an increase in the demand for cloud computing and be zoning of infrastructure. Most of the traditional methods which were used in the organizations are replaced by automation. Vendors are also trying to bring in more automation in their services.
- Growing popularity of the ecommerce segment and increased use of smartphones will drive the market. Many companies outsource their after sales services or the help desk services to other companies as it is helpful in reducing the amount of time spent on these activities and the cost incurred by these companies. It is also beneficial as it helps in improving the focus on the core processes of the business.
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Scope of the Report
| Report Attributes | Details |
| Market Size in 2021 | USD 530.15 Billion |
| Revenue Forecast by 2030 | USD 1.06 Trillion |
| CAGR | 8.06% from 2022 to 2030 |
| Largest Market | Asia Pacific |
| Base Year | 2021 |
| Forecast Year | 2022 to 2030 |
| Key Players | Accenture, Cognizant, Capgemini, Infosys, IBM, HP, Oracle |
Market Dynamics
Drivers
There has been a growth in the demand for these outsourcing services add some of the companies may have a shortage of manpower. And there is a growing demand for the use of the virtual software that would be instrumental in performing many functions for the company. The amount of time spent and the amount of cost which goes in the employing of new staff will be one of the reasons why there is a greater demand for outsourcing. Due to an increase in the project related jobs the demand for outsourcing is expected to grow. As and when the need arises more staff can be employed or the staff can also be reduced.
All the targets of the project are met without wasting any time on training. It also helps in providing enhanced security. Outsourcing has been extremely beneficial for the cyber security. In order to reduce the cost many market players are focusing on outsourcing their functions. Outsourcing also helps in improving the focus on the core activities.
Restraints
Due to the outsourcing of various functions new staff is involved in the functioning due to which the main organization has less control in the activities. When a business function is outsourced the secondary managing body may not perform the tasks as laid down by the company through the similar standards. The quality of the services may also be affected. In case off hiring less qualified staff to perform various functions the service quality will also be hampered to a great extent.
Opportunities
The market is expected to grow in the coming years due to the availability of qualified and certified staff. The availability of the labor which is offered at lower cost will also drive the market growth in the coming years. The efficiency and the competitiveness of the organizations improved due to the outsourcing of few services. That is providing opportunities for growth is the risk sharing factor. The increased use of the high-end technologies in these outsourced regions will provide better opportunities for growth.
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Challenges
The devising of an agreement or the contract between the service provider and outsource are needs to be free of any loopholes. The organizations should seek the help from legal experts in order to keep the business going. Any political unrest among the countries will have a great impact on this business and it happens to be a major challenge in the growth. Outsourcing any functions of the business may alter the quality service offered to the consumers. Over a period of time it may also harm the reputation of the company. As the quality of the services offered deteriorate the customer satisfaction is also affected and these are the major challenges in the growth of the market.
Recent developments
- Infosys had collaborated with Telenor Norway in the year 2022. This collaboration aims at transforming the supply chain operations as well as the finance operations of these organizations.
Market Segmentation
By Service
- Application
- Network operations
- Data center operations
- Help desk
- Emerging technology
- Others
By Location
- Offshore
- Onshore
By End User
- BFSI
- Healthcare
- Aerospace and defense
- Telecom and media
By Geography
- North America
- Europe
- Asia-Pacific
- Latin America
- Middle East & Africa (MEA)
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