Outsourcing and Managed Services Trends in 2013

On February 28, 2013, in Outsourcing, by Business Development Group
Given the current environment of the economy and the outsourcing industry,  more and more companies are spurred into outsourcing other managed services more broadly.

... back-office functions and other areas that do not directly contribute to revenues but were previously considered too risky to outsource, such as actuarial modelling, retirement plan record-keeping and tax processing, would be outsourced.

With the continued growth of the outsourcing industry and maturation of outsourcing providers plus the current economic situation, more and more companies are now considering outsourcing other managed services more broadly.

What does this mean? According to Brian Anderson, an executive at SunGard Systems SA, a software and technology services firm, this means that back-office functions and other areas that do not directly contribute to revenues but were previously considered too risky to outsource, such as actuarial modelling, retirement plan record-keeping and tax processing, would be outsourced.

How would this affect the firm and the outsourcing industry? Mr. Anderson added that this shift would be an advantage for the firms that would avail of outsourcing. Firms will benefit from service providers’ economies of scale and domain expertise, while helping them focus resources on core business areas that directly contribute to revenue generation. This shift would also mean a boost on the outsourcing sector.

Related Article: Philippine Outsourcing – Gearing Ahead For A Successful 2013

SunGard has identified 10 trends in outsourcing and managed services:

1. Business process outsourcing (BPO) and managed services activity will see a continued increase as more and more companies are seeing its benefits.

2. As the cloud technology is on a rise, software as a service (SaaS) will become a popular solution as it will increase the productivity of companies across several software components.

3. Apart from application hosting, clients of traditional BPO and information technology outsourcing will now also look into industry-specific services.

4. Bulk processes such as infrastructure, application management services, and custom development are likely to be outsourced more as business executives want to have more internal resources for their core functions.

5. With the progress of the outsourcing industry, service providers are expected to provide more in the IT services that would help firm reduce costs, offer business efficiencies and advantages, and help firms manage an ever greater range of challenges for their clients.

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6. Contracts are also predicted to become more flexible, which balances cost control between the provider and buyer.

7. Service providers that could provide cloud computing would be in demand as a mean for cost-effective way to handle IT infrastructure and application management.

8. Outsourcing providers are expected to be more efficient and offer higher quality services and would adhere to global standards like COPC, ITIL and Lean Six Sigma.

9. More buyers will be more cautious and are anticipated to put providers under a microscope before signing a deal. They will look for good customer reviews, stricter service level agreements, and certifications.

10. Companies will look to managed services providers to operate and maintain new and complex initiatives such as big data and smart grids.

Related Article: Critical Aspects of Outsourcing:  Cost, Quality, and Value

 

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