trends in it outsourcing
TRANSCRIPT
TOP JOBSOUTSOURCED
IT OUT$OURCINGEXPENDITURE
TRENDS, BENEFITS, STATS, FUTURE,AND A BRIEF LOOK AT DGT
MORE THAN2.4 MILLION JOBSOUTSOURCED FROM THE US
IN LAST 10 YEARS.
Information Technology
28%
32%
11%
14%
15%Human Resources
Sales and marketing
Financial Services
AdministrativeOutsourcing, etc.
Source: IMF World Economic Outlook data, Hackett Group proprietary data and publically available company data
ESTIMATED2002
TO
TA
L
JO
BS
2012 2014 2016
8.3million
6.8million
6.8million
6.8million
4.6 million
0.3 million
3.4 million 3.3 million 3.4 million
1.4 million
2.0 million
3.5 million
1.0 million
2.3 million
1.8 million
1.7 million
Jobs already offshored from North America and Europe
Jobs still based in North America and Europe but whichcan be offshored
Jobs based in North America and Europe which cannot be offshored
Terminated one or moreoutsourcing agreements.
Increased outsourcing
57%
34%
9%
POPULARITYOF
OUTSOURCINGSince the recession of
2008-2009
Restructuredone or moreoutsourcing agreementsin a significant way
Source: http://brandongaille.com/26-us-outsourcing-statistics-and-trends/
Source: Deloitte’s 2014 Global Outsourcing and Insourcing Survey
PLANS FORIT OUTSOURCING53%
26%CURRENTLYOUTSOURCINGIT FUNCTIONS
Source: The IT Outsourcing Statistics 2014/2015 study
LARGE
7.4%
ORGANIZATIONS
OF THEIRIT BUDGETS
MID-SIZEORGANIZATIONS
4.6%OF THEIRIT BUDGETS
SMALLORGANIZATIONS
6.1%OF THEIRIT BUDGETS
TOP OFFSHORINGDESTINATIONS
TRENDS TOLOOK OUT FOR
Source: http://brandongaille.com/26-us-outsourcing-statistics-and-trends/
Source: A.T. Kearney’s 2014 Global Services Location Index (GSLI)
Source: Deloitte's 2014 global outsourcing and insourcing surveyhttp://www2.deloitte.com/us/en/pages/strategy/articles/2014-global-outsourcing-and-insourcing-survey.html
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REAS
ON
S FOR OUTSOUR
CIN
G
Reduce or controlcosts and /or preservecapital
Gain access toIT resourcesnot availableinternally
Free up internalresources to
focus on coreoperations
Improve business orcustomer focus
Accelerate companyreorganization/transformation
Accelerateproject
Gain access to expertisenot available internally
Reduce timeto market
44%
34% 31%
22%
28%
15%
15%
9%
1.43BILLIONI N D I A
1.03BILLIONI N D O N E S I A
780 MILLIONC H I N A
39 MILLIONP H I L L I P I N E S
26 MILLIONE G Y P T
2 MILLIONL I T H U A N I A
3 MILLIONB U L G A I R A
INDIA (7.1) 1.43 BILLIONINDONESIA (6.9) 1.03 BILLIONCHINA (6.4) 780 MILLIONBULGARIA (6.4) 3 MILLIONPHILLIPINES (6.3) 39 MILLIONJORDAN (6.2) 2 MILLIONSINGAPORE (6.5) 3 MILLIONTHAILAND (6.0) 39 MILLIONLITHUANIA (5.9) 2 MILLIONEGYPT (5.8) 26 MILLION
2 MILLIONJ O R D A N
3 MILLIONS I N G A P O R E
39 MILLIONT H A I L A N D
Companies mayseek multi-vendor or
multi-functional strategies requiring
transition and service integrationcapabilities
SOLUTION
BENEFITS
∙ HIRING DEDICATED DEVELOPMENT TEAMS
∙ DIRECT COMMUNICATION WITHTHE DEDICATED DEVELOPERS
∙ FULL CONTROL OVER THE PROJECT∙ FULL INVOLVEMENTOF TEAM MEMBERS
∙ COST CUTTING ON HIRING,TRAINING, INFRASTRUCTURE
EXPANSION ETC.
CLIENT’S ISSUES
∙ FEEL VENDORS ARE BEING REACTIVE VS. PROACTIVE49%
∙ FEEL THERE IS LACK OF INNOVATION37%
Source: Deloitte’s 2014 Global Outsourcing and Insourcing Survey
SUYATI TECHNOLOGIESPIONEERS OF DEDICATED GLOBAL TEAM (DGT)
DGT
Clients will continue to demand
more from their vendors
Vendors would continue to evolve
their services to fulfill customer needs, and deliver value on both
qualitative and quantitative terms.
CREATIVE
TECHNICAL
FINANCIAL
SAY
DGTGIVES CLIENTSCOMPLETE CONTROL
KEY ISSUE HOW DGT CAN SOLVE IT
DELAYS IN SCHEDULE ANDINABILITY TO MEET MILESTONES
HIDDEN COSTS
LACK OF APPROPRIATE RESOURCES
SECURITY ISSUES
CULTURAL BARRIERS
COMMUNICATION
INABILITY OF OUTSOURCINGPROVIDER TO UNDERSTANDCLIENT'S BUSINESS NEEDS
INFLEXIBLE CONTRACTS
LACK OF EXIT STRATEGY
PROVIDES RIGHT INFORMATION AT THE RIGHT TIME, MAKING IT EASY TO FIX CORRECT AND REALISTIC DEADLINES.
OFFERS TRANSPARENT COST STRUCTURE, ON A COST + MARGIN MODE
INVOLVES CLIENT IN THE TALENT SELECTION PROCESS
PROVIDES OVERALL CONTROL; CLIENT CAN SELECT APPROPRIATE PHYSICAL, NETWORK AND VIDEO SECURITY
CULTURAL TRAINING AND TIMELYFEEDBACK TO COUNTER DISPARITY
MULTIPLE METHODS TO COMMUNICATE, SUCH AS EMAILS, GO TO MEETING, PIVOTAL TRACKER, TFS, AND SKYPE, ETC.
DEDICATED TEAM SET UP SPECIFICALLY FOR THE CLIENT'S PURPOSE; FOCUS REMAINS ON THE CLIENTS BUSINESS
STRAIGHTFORWARD CONTRACTS, WHICH ARE TRANSPARENT AND SCALABLE
OFFERS OTHER OPTIONS SUCH AS BOT OR JV RELATIONSHIPS IF DGT DOES NOT WORK OUTAS EXPECTED
48%
Source: http://brandongaille.com/26-us-outsourcing-statistics-and-trends/
ADDITIONAL JOBS INFINANCE, IT, AND OTHERKEY BUSINESS SERVICESAREAS WILL BEOFFSHORED BY 2016(HACKETT GROUP)
VALUE OF OUTSOURCINGIS EXPECTED TOINCREASE TO TOUCH
IN 2015
COMPANIES PLAN TO HIRE MOREOUTSOURCERS THAN FULL OR PART TIMESTAFF IN THE NEXT 12-18 MONTHS
7,50,000$25 BILLION
FUTUREOF OUTSOURCING
OFFSHOREOUTSOURCING TOGROW BYMORE THAN
ANNUALLY(META GROUP)
20%
Reference• http://www2.deloitte.com/content/dam/Deloitte/us/Documents/strategy/us-%209127988%20global-%20outsourcing%20-survey%20-infographic.pdf• http://www.slideshare.net/kmukund7?utm_campaign=profiletracking&utm_medium=sssite&utm_source=ssslideview• http://suyati.com/why-dedicated-offshore-team/• http://www.thehackettgroup.com/about/research-alerts-press-releases/2012/03272012-hackett-research-forecasts-offshoring.jsp• https://www.maxaur.com/outsource_stat.aspx• http://www.computereconomics.com/temp/outsourcingstatisticssamplepages.pdf• http://www.meti.go.jp/english/report/downloadfiles/1-2e.pdf• http://brandongaille.com/26-us-outsourcing-statistics-and-trends/• http://www2.deloitte.com/us/en/pages/strategy/articles/2014-global-outsourcing-and-insourcing-survey.html• http://www.daxx.com/article/IT-Outsourcing-Statistics-Trends-2013-2014• https://www.kpmg-institutes.com/content/dam/kpmg/sharedservicesoutsourcinginstitute/pdf/2014/state-of-outsourcing-2014-exec-findings-hfs.pdf• https://www.kpmg-institutes.com/content/dam/kpmg/sharedservicesoutsourcinginstitute/pdf/2014/state-of-outsourcing-2014-exec-findings-hfs.pdf• http://suyati.com/engagementmodels/dedicated-global-teams/• http://www.slideshare.net/kmukund7/dedicated-global-teams-sm