IT Outsourcing Trends 2017

  • 20 / 10 / 2017

2017 has already been a huge year for IT outsourcing, but it hasn’t been without its challenges. Integration is a key issue, as is coping with potential security issues across the industry. Finally, cloud computing has really taken off, and as a result it’s becoming a key demand from customers. In the article that follows, we’ll go over some of the biggest upcoming trends in IT outsourcing, so that you can stay ahead of the game and know what to expect in the next few months.

Firstly, the world is in a fairly precarious state at the moment, what with Brexit in Europe and Donald Trump’s proposed economic reforms in America. This will naturally have a knock-on effect on the IT outsourcing industry, which depends on stability in order to thrive.

IT outsourcing is a global industry, and changes to trade agreements, regulations, and tax policies could present an issue to those looking to hire an offshore outsourcing firm. Companies have already started to assess their contracts to figure out just how serious this impact could be, and this will likely lead to industry-wide changes in how contracts are drawn up.

For instance, new termination rights and rights to insource may well become the standard, as clients seek protection in the event of significant changes to the corporate climate. The political environment could well lead to companies outsourcing high-end word to onshore locations, instead of offshore.

As always, data security will remain a prime concern for many over the next year, too. Advanced security automation and security analytics solutions will continue to be a popular choice for many, as companies look to protect themselves from any and all business risks.

IT outsourcing will be able to take advantage of this by offering scalable security solutions, and dynamically support could-based workloads to make collaboration easier than ever. Rather than being a potential entry point for hackers, vendors will become a key ally in the battle for data security.

As well as these pre-existing concerns, there will also be big steps forward for IT outsourcing companies, namely with regards to intelligent automation and robotic process automation. By automating processes wherever possible, vendors will be able to drive down their costs, securing larger profits. This will also have an effect on service prices, albeit on a smaller scale so that vendors can still enjoy the biggest benefits.

Enterprise buyers will have greater savings opportunities, and existing contracts will need to be renegotiated if they involve processes which will now be automated. On an industry-wide level, it’s likely that outsourcers will become split between those who can offer automation, and those who can’t, who will wind up having to play catch up.

Next, cloud computing has gone from being a novel idea to one which virtually the entire business world has adopted. This means that clients will expect much more from cloud providers, and those who only offer a basic service will quickly find that they can no longer compete with those who can provide a bigger, better service.

The cloud will become the core platform for both internal and external initiatives, and will therefore want to get better value form cloud service providers. The cloud is now the key driver of transformation in business- so outsourcing vendors need to get on board or miss out.

Finally, it looks like the once-unstoppable growth of offshore outsourcing firms has come to an end. As well as the political instability mentioned above, and increasing automation, offshore providers are also being faced with currency exchange issues.

Taken together, this all means that vendors will be facing extra margin pressures, and may have to downsize in order to cope. At the same time, they still need to offer innovative solutions to customers in order to stay competitive and manage multiple contracts at once.


Article by KosBIT