In today’s economy, businesses must cut costs and innovate to stay relevant. One effective way to achieve this is through IT outsourcing, particularly software development outsourcing, which has become highly valuable.
Before embarking on outsourcing, organizations may have several questions, such as why companies are increasingly outsourcing IT services, what IT functions are commonly outsourced, how cloud computing impacts IT outsourcing, and the role of cybersecurity in these decisions.
This blog aims to illuminate today’s prevailing IT outsourcing trends. With this objective in focus, what is currently prominent in today’s outsourcing market?
Current Outsourcing Trends
Currently, a significant number of US companies are outsourcing services internationally, leading to a substantial number of US jobs being outsourced annually. This market is expected to experience steady growth in the coming years.
Traditional outsourcing destinations include the Philippines and other Asian countries due to lower overhead costs. However, emerging markets like South America, South Africa, and Eastern Europe are becoming popular for outsourcing in sectors such as IT, healthcare, finance, and HR.
Globally, AI is streamlining processes and improving decision-making, significantly enhancing customer satisfaction. Cloud computing offers companies flexibility, efficiency, and innovation, supporting a stable infrastructure for a global workforce that can collaborate across different time zones.
Modern IT Outsourcing Trends
The primary driver of modern IT outsourcing is the need to leverage new technologies and the lack of in-house skills to do so. This includes areas like cloud computing, DevOps, chatbot development, and AI.
Notably, ChatGPT and Generative AI have become significant topics since 2022-23. Organizations are now looking to implement these technologies quickly, often turning to IT outsourcing to stay competitive, as upskilling in-house staff can be time-consuming and costly.
These are just a few of the current IT outsourcing trends shaping the global market today.
Top Five IT Outsourcing Trends
The outsourcing market is dynamic, with numerous trends shaping its landscape. Here are five of the most current IT outsourcing trends:
Cybersecurity a Key Focus
As cyberattacks become more sophisticated, outsourcing companies must adopt multi-layered approaches to reduce risks and protect customer data. This focus on cybersecurity is crucial in the digital age for maintaining trust. As per recent IT outsourcing statistics, cybersecurity measures are becoming a top priority for many organizations.
AI and Automation Support
Despite the widespread adoption of AI and automation, these technologies still require human oversight. The increased reliance on AI and automation, accelerated by government lockdowns four years ago, highlights the need for human support to function effectively. This trend is particularly evident in software development outsourcing, where AI aids but does not replace human expertise.
Cloud Computing Demand
With the rise of remote work, cloud computing is more essential than ever. Contact centers have continued remote work post-lockdowns, highlighting the need for employees to access organizational servers from any location. This indicates a significant shift in software development outsourcing trends toward cloud-based solutions.
Persistent Remote Work
Remote work is here to stay, driving an increase in flexible job opportunities. Organizations that offer remote work options will attract top talent, especially as some companies call employees back to the office. This shift is also influencing mobile development and web app development, as remote teams require robust digital collaboration tools.
Growth of Nearshoring and Onshoring
Nearshoring and onshoring are gaining popularity as companies seek to mitigate risks and improve communication by outsourcing to geographically closer regions. This trend reflects a strategic shift toward enhancing efficiency and maintaining tighter control over projects. Nearshoring and onshoring are becoming significant aspects of future outsourcing trends, offering a balance between cost savings and operational effectiveness.
Mergers and Acquisitions
The outsourcing market is likely to see more mergers and acquisitions as larger firms acquire smaller ones to fill skill gaps. An example is Sitel’s acquisition of Sykes, which made Sitel one of the top three customer experience (CX) leaders globally. Other large outsourcing firms may follow suit to enhance their capabilities, reflecting future trends in the industry.
Conclusion
The IT outsourcing landscape is undergoing significant changes, driven by technological advancements, evolving business needs, and global market dynamics. The latest IT outsourcing trends, such as the shift to cloud-based solutions, the rise of AI and ML, and the emphasis on cybersecurity, are shaping the future of the industry. Future trends in Outsourcing, such as the growth of nearshoring and onshoring, and the increasing demand for digital transformation, are also influencing the direction of the industry. By staying abreast of these trends, businesses can make informed decisions and leverage IT outsourcing to achieve their strategic goals.
At Shispare, we take care of all these trends in our IT outsourcing services. We help businesses migrate to cloud-based solutions, providing scalable and cost-efficient infrastructure. Our expertise in artificial intelligence and machine learning ensures that our clients benefit from advanced automation and predictive analytics. We prioritize cybersecurity, implementing robust measures to protect sensitive data and ensure compliance with regulations.
So contact us today and harness the power of technology to drive innovation and growth.
