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Outsourcing in 2020 – what will change according to the Global Sourcing Association?

date: 17 May 2016
reading time: 3 min

How much can change in 4 years? Is outsourcing going to evolve dramatically, or will it simply twitch a little bit? Let’s find out from Global Sourcing Association’s newest report.

Global Sourcing Association released a report predicting changes that are bound to happen in outsourcing in the upcoming 4 years.

The Association surveyed 134 organisations for expert opinion on the future of outsourcing and upcoming trends. They chose C-level respondents: directors, heads, presidents, senior vice presidents, managers, and specialists.

To save you time, we decided to skim it for you and present the most important findings.

The basics

Buyers, as well as the suppliers, both agree that outsourcing industry is bound to grow. 35% to 37% claim it will increase significantly. What is more, 80% of respondents predict an upsurge in their outsourcing, which will ultimately make it much more prevalent.

The drivers behind the decision to outsource weren’t a surprise – 35% of those surveyed chose cost savings as the main factor, 23% wanted to improve the customer experience.

The results aren’t surprising, since outsourcing, if done right, allows both parties to learn a lot from each other, from simple skills to introducing improvements to the way their organisation is run.

What will count?

Both, buyers and suppliers consider data analytics, digital transformation and RPA (Robotic Process Automation) to play the biggest role in 2020. What will become less important however, is backsourcing.

RPA, according to the respondents (58% of buyers and 65% of service providers), will drive significant process improvements. Furthermore, they also believe that thanks to this enhancement the price of the processes will become more competitive and limit the use of offshoring to eventually replace the FTE (full-time equivalent) model.

Artificial Intelligence, on the other hand, brought different opinions, since buyers don’t believe it to be the trend of the future, whereas almost half of service providers, do. However, as we all can presume, both trends are bound to expect impending growth.

Cooperation in 2020

In 4 years we can expect our focus to shift on the outcomes –buyers and providers both agree in this case.

The biggest change will be connected with e-auctions, which are predicted to be used more and more often. The changes will also come for providers who will be solely responsible for the projects, and will take over all the risk.

In case of the development, service providers must focus on innovating, relationship management and collaboration. Clients, on the other hand, must pay attention to outcomes instead of outputs and nurture the relationship.

The predictions shed some light on the future of outsourcing. However, there is still a lot of time ahead of us, so let’s just observe which ones will actually become true in the future.

If you are here, there’s a big chance that you’ve been wondering How will change the future of IT outsourcing?. We can help you with it. Please check out our 2020 Software Development Guide.

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