– Industry analyst HfS research launches its quarterly market size and forecasting index for IT and business process outsourcing –
NEW YORK AND LONDON (February 21, 2013) –
HfS Research (www.HfSresearch.com
), the leading analyst authority addressing global business and IT services, today announced the results of the inaugural HfS Market IndexTM
, a unique global market size and forecasting instrument dedicated tracking to IT outsourcing and business process outsourcing expenditure on a quarterly basis.
As a consequence of the current wave of economic uncertainty and the recent growth in North America, HfS is forecasting that combined global expenditure on ITO and BPO Services services will see a modest upturn in 2013, with growth in projected to be 4.0%.
The BPO market is demonstrating the strongest growth, forecasted to increase by 5.1% in 2013, with a 6.0% CAGR through 2017. HfS anticipates increased demand across Finance and Accounting BPO (7.8%) and Human Resources BPO (5.6%) services as the main growth sectors. HfS research clearly shows the principal drivers behind this BPO growth are a strong desire from business function leaders to reduce operational costs, combined with the need to standardize processes and evolve into more globalized business models. Research across 400 enterprises also shows that BPO delivery models are maturing and succeeding in achieving promised cost reduction targets for 90% of current BPO engagements, which is shifting the attitude of many corporate leaders from one of “why should we do this”, to “why shouldn’twe?”.
Growth in the ITO services market is expected to increase in 2013 to 3.5% and sustain a 4.7% CAGR through 2017. HfS anticipates that the infrastructure management services, application management, and professional services markets will see increased growth in 2013 with the opportunity for geographic growth, particularly in North America and Asia/Pacific. Growth is anticipated to strengthen in the second half of 2013, with the economy is expected to recover. IT budgets remain under tight control, however HfS expects to see small increases in IT budgets, namely in North America and Asia/Pacific. Europe, particularly those countries in the Euro Zone, will continue to experience little or no growth in overall IT budgets, which is forcing many organizations to explore outsourcing options to create cost savings to support new IT investment opportunities.
“With the sovereign debt crisis in Europe and the very concept of outsourcing being questioned during 2012 US presidential campaign, 2013 will continue to be a challenging market for outsourced services,” said Jamie Snowdon, Director, Market Forecasting and Data Products at HfS Research. “However, BPO and IT Outsourcing continue to be vital cost-control levers and enterprise clients will continue to increase their spend as the economic climate improves during the course of the year.”
Also commenting on the HfS Market IndexTM findings, Phil Fersht, Chief Executive Officer of HfS Research added,”2013 will see a maturing of organizational approaches to outsourcing and shared services. Gone are the excuses, now is the time for execution after the recent years of uncertainty”.
HfS Research is pleased to offer a complimentary copy, for a limited time only, of the inaugural HfS Market IndexTM for Q1 2013, which highlights key market forecasts across ITO and BPO services markets by major global regions. The future quarterly indices will include market views by key industry verticals and countries.
Click here to access a complimentary copy of the
HfS Market Index for Q1, 2013