With the aid of third-party providers, many firms, including those in the IT, payroll, e-commerce, and support, rear processes, purchasing, human capital & recruitment process, among others, use business operations outsourcing (BPO) services.
COVID-19 Impact and Market Status
The COVID-19 outbreak has had an impact on outsourcing plans for several corporate sectors around the world. Both short-term and long-term issues are ahead for the BPO market. The fragile ecosystem of outsourced IT-BPO services is made vulnerable by this pandemic situation. The BPO service sector, like other businesses, cannot accommodate remote work and work from home (WFH). Handling private data and information between customers and the business is common. Since they handle private back-office information including financial transactions, the BPO sector has been less flexible in altering and adjusting the WFM model. Government rules requiring strict lockdown procedures have had a significant negative impact on the upkeep of data centres housing sensitive data and problems with business continuity. The existence of 25–50% workers means that the costs associated with the IT resources are rising, and they are also unable to provide services on time, which causes delays and legal penalties for non-performance. The BPO service sectors are taking the necessary actions to accelerate the BPO services market.
E-commerce support services to render the growth
Based on the type segment, the global BPO and ITO Services Market is classified on the basis of IT Outsourcing, Finance and Accounting Outsourcing, Back Office Outsourcing, E-Commerce Support Services. Out of all these classifications, the e-commerce support services or the customer support services sector is projected to show ample growth in the global BPO and ITO Services Market. The growth can be linked to the increasing demand of service centres all over the world.
Expansion of IT and Telecom Industry is driving the market forcefully
The main force behind the growth of BPO services is the expansion of their use in the IT and telecommunications industries. The market is being strengthened by the BPO services' adaptability to a variety of end-use sectors, including manufacturing, banking, and financial services. The use of BPO services is growing due to decreased operating expenses and increased support function efficiency in client services. BPO services are able to provide dependable, pertinent, and round-the-clock help for crucial business activities thanks to their interconnection with organizations. Business culture would be driven by the desire for business process outsourcing & result in ongoing success by focusing on shared workload. Businesses are increasing their BPO investments, which is fuelling industry expansion.
North America to be the Leading region, globally
The global market for business process outsourcing is divided geographically into five areas: European, North America, South America, Asia-Pacific, and the Middle East and Africa. Out of these, America had the biggest market share in 2020, at over 36%. Due to the increased use of cloud-enabled services and digital products, which necessitate regular support and upkeep for daily operations and so accelerate market growth. Additionally, it is anticipated that the Region will experience the highest CAGR during the forecast period due to the high demand for skilled workers, declining labour costs, and significant investments in digital technology.
Businesses are looking for third-party (BPO) service providers to increase operational and operating efficacy and preserve their competitiveness in the market. Over the past few years, there has been a huge demand for business process outsourcing (BPO). All firms use BPO services to increase their ROI due to the great benefits of time and money saved on repetitive operations.
The majority of businesses in the industry are making significant investments in the creation of cutting-edge technology like big data, analysis, cloud services, and artificial intelligence in order to offer full outsourcing services to their customers.
The market for business process outsourcing was estimated to be worth USD 245.9 billion in 2022, and it is anticipated to increase at a CAGR of 8.5% during the forecast period to attain a market value of USD 503.6 billion. In order to withstand the continuously shifting business dynamics, businesses are putting more emphasis on enhancing their efficiency & business agility, reducing operating expenses, and highlighting their core capabilities. These reasons all contribute to the market's growth.
Despite the industry being controlled by a few numbers of major firms, newbies are also entering it because of the existence of lucrative markets. This could lead to more rivalry in the market. Additionally, a number of firms are putting more emphasis on lowering the cost of doing business in order to access global resources in order to fulfil the expanding industry demands. These elements have influenced the adoption use outsourcing (BPO) services by a number of firms that concentrate on using technical advancements like artificial intelligence (AI) and cloud computing to increase organizational efficiency. BPO is the process of contracting with outside service providers to handle the duties and operations of various business processes.
BPO services are in high demand because of their advantages, including lower prices, more flexibility, and higher service quality. Additionally, BPO enables businesses to return to their core competencies in order to provide clients with additional value. Due to their advantages across final-use industries including IT and or telecommunication, Banking, and healthcare, BPO services are in high demand.
Investing in BPO services may seem like an unnecessary expense if your organization is just getting off the ground. But when you balance the benefits with the drawbacks, you'll discover that using BPO services can be quite beneficial for your company.
The key industry players include ADP, Conduent Inc, Accenture PLC, WNS (Holdings), Capgemini, and Infosys BPM. These companies are the leading market players and are paving the way forward for the industry’s growth and expansion. They lead the BPO and ITO market globally and have achieved this by constantly succeeding with the help of their respective strategies and sticking to it.
Latest Innovations in the Global BPO and ITO Services Market: A Snapshot
- With artificial intelligence taking the world by storm, the BPO industry is no exception in not adapting to it. The need for human intervention has drastically reduced with the onset of AI and automation; however, no human supervision can make the systems prone to errors too. Thus, automation and AI with human services and supervision are capable of contributing to the growth of the entire industry.
- The inculcation of data analysis software and enhancement in voice recognition has proven to be a game-changer for the global BPO and ITO industry since the huge chunk of data must be excellently and resourcefully analyzed and the data analysis software succeeds at achieving the same. The inclusion of voice recognition software in call centres, if existing, helps companies achieve greater success as many consumers’ spoken words can be associated with commands and reduce the workload on the operator while increasing the efficiency of the customer care process at the same time.
BPO and ITO Services Market Scope
|Forecast Unit||Value (USD)|
|Revenue forecast in 2029||USD 503.6 billion|
|Growth Rate||CAGR of 8.5 % during 2021-2029|
|Segment Covered||Type, End-user, Regions|
|Regions Covered||North America, Europe, Asia Pacific, South America, Middle East and South Africa|
|Key Players Profiled||ADP, Conduent Inc, Accenture PLC, WNS (Holdings), Capgemini, and Infosys BPM.|
Key Segments of Global BPO and ITO Services Market
Type Overview, 2019-2029 (USD Billion)
- IT Outsourcing
- Finance and Accounting Outsourcing
- Back Office Outsourcing
- E-Commerce Support Services
End-user Overview, 2029-2029 (USD Billion)
- IT and telecommunications
- Life sciences
Regional Overview, 2019-2029 (USD Billion)
- Rest of Europe
- Rest of Asia Pacific
- Rest of South America
Middle East and South Africa