BPO Geographic Trends
Geographic Trends
In the United States and Europe, the sourcing markets remain very buoyant. In the US, the outsourcing market is expected to grow by average 9.3% over 2005-10. A key driver will be increased adoption of BPO as companies prioritise the outsourcing of key business processes.
In Europe, the UK remains the biggest market for BPO deals and, generally across Europe, demand for outsourcing is growing (although still lagging the US and UK, which one might say reflects a normal lag of European countries adopting technology relative to the United States). Sourcing advisers TPI reported last year that Europe is now the biggest market for outsourcing – with 49% of all new contracts in 2004 and, for example, Germany is now 12% of the world market from virtually zero in 2001.
In Asia, of course, the sourcing market is supply-side driven. But the biggest Asian economy of them all, Japan, remains the enigma of the sourcing market. According to a recent IDC survey, 14.8% of Japanese corporations have used IT outsourcing for more than 3 years; 19.8% have considered IT outsourcing but decided against it; but a startling 50.9% of Japanese corporations are not currently considering the use of IT outsourcing. This reflects the experience of Morrison & Foerster’s own Tokyo office – the largest of any foreign law firm in Japan – which sees plenty of joint manufacturing and research projects, but a relatively low incidence of traditional outsourcing projects.
It seems that the key to the future success of the Japanese outsourcing market lies not just in addressing pricing, security and service issues, but in how well vendors can surmount the degree of cultural resistance to outsourcing that exists there. If the vendors can unlock the Japanese market, that could be the next big driver in growth for the global sourcing market.
Source: Internet
In the United States and Europe, the sourcing markets remain very buoyant. In the US, the outsourcing market is expected to grow by average 9.3% over 2005-10. A key driver will be increased adoption of BPO as companies prioritise the outsourcing of key business processes.
In Europe, the UK remains the biggest market for BPO deals and, generally across Europe, demand for outsourcing is growing (although still lagging the US and UK, which one might say reflects a normal lag of European countries adopting technology relative to the United States). Sourcing advisers TPI reported last year that Europe is now the biggest market for outsourcing – with 49% of all new contracts in 2004 and, for example, Germany is now 12% of the world market from virtually zero in 2001.
In Asia, of course, the sourcing market is supply-side driven. But the biggest Asian economy of them all, Japan, remains the enigma of the sourcing market. According to a recent IDC survey, 14.8% of Japanese corporations have used IT outsourcing for more than 3 years; 19.8% have considered IT outsourcing but decided against it; but a startling 50.9% of Japanese corporations are not currently considering the use of IT outsourcing. This reflects the experience of Morrison & Foerster’s own Tokyo office – the largest of any foreign law firm in Japan – which sees plenty of joint manufacturing and research projects, but a relatively low incidence of traditional outsourcing projects.
It seems that the key to the future success of the Japanese outsourcing market lies not just in addressing pricing, security and service issues, but in how well vendors can surmount the degree of cultural resistance to outsourcing that exists there. If the vendors can unlock the Japanese market, that could be the next big driver in growth for the global sourcing market.
Source: Internet
posted by Manoj Jain @ 9:52 PM
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