The Latest It Outsourcing Industry Statistics Explained
Global outsourcing market amounts to $92.5 billion.
The statistic “Global outsourcing market amounts to $92.5 billion” refers to the total value of the market for outsourcing services worldwide. This figure represents the revenue generated by businesses that provide outsourcing services in various industries such as information technology, customer service, manufacturing, and more. Outsourcing involves contracting specific business functions to external vendors or service providers, often located in different countries, in order to leverage cost savings, improve efficiency, and access specialized expertise. The $92.5 billion market size indicates the scale and significance of outsourcing as a strategic business practice on a global scale.
IT Outsourcing (ITO) reached its revenue of over $66.5 billion globally in 2019.
The statistic “IT Outsourcing (ITO) reached its revenue of over $66.5 billion globally in 2019” signifies the substantial financial impact of the IT outsourcing industry on a worldwide scale during that year. This figure reflects the total revenue generated by IT outsourcing services provided by companies across various regions. The sizeable revenue highlights the significant demand for IT outsourcing solutions, indicating that businesses and organizations increasingly rely on external IT service providers to manage and support their technology needs. Such a high revenue figure suggests the growing importance of IT outsourcing in helping businesses leverage specialized expertise, enhance efficiency, reduce costs, and adapt to rapidly evolving technological landscapes.
The total contract value (TCV) of the global outsourcing market stands at $37 billion in Q4 2020.
The statistic indicates that the total contract value (TCV) for outsourcing services in the global market reached $37 billion in the fourth quarter of 2020. This figure represents the sum value of all contracts signed during that period for outsourcing services across various industries and functions. The TCV is a crucial metric that reflects the size and growth of the outsourcing market, as organizations increasingly rely on third-party service providers to deliver cost-effective and specialized solutions. The $37 billion TCV in Q4 2020 highlights the significant scale and economic impact of outsourcing activities on a global scale during that period.
70% of IT executives outsource application hosting and maintenance.
The statistic ‘70% of IT executives outsource application hosting and maintenance’ indicates that the majority of IT executives choose to delegate the responsibility of managing and maintaining their software applications to external service providers. Outsourcing such tasks allows IT executives to focus on strategic initiatives, cost savings, and benefits from the expertise and resources offered by specialized service providers. This statistic suggests a growing trend in the IT industry towards leveraging external partners for application hosting and maintenance services, potentially driven by factors such as cost optimization, access to specialized skills, and increasing complexity of technology environments.
By 2027, the IT outsourcing industry is projected to reach $397.6 billion.
The statistic that the IT outsourcing industry is projected to reach $397.6 billion by 2027 indicates a significant growth in the demand for outsourcing services within the IT sector. This projection suggests a growing trend among businesses to engage external IT service providers to manage their technological needs, which can range from software development, cloud services, cybersecurity, and technical support. The increasing reliance on outsourcing in the IT sector can be attributed to various factors such as cost-efficiency, access to specialized expertise, and the flexibility it offers in scaling operations. As the industry continues to evolve with advancements in technology, the projected growth reflects a continued opportunity for IT outsourcing providers to expand their service offerings and capture a larger market share.
The Asia-Pacific region holds the largest share of the IT outsourcing market.
The statistic “The Asia-Pacific region holds the largest share of the IT outsourcing market” indicates that among all geographical regions worldwide, Asia-Pacific has the highest market share in terms of IT outsourcing services being provided or sourced from companies within this region. This suggests that a significant portion of IT outsourcing activities, such as software development, technical support, and infrastructure management, are undertaken by companies based in countries within the Asia-Pacific region. Factors contributing to the region’s dominance in IT outsourcing may include lower labor costs, a skilled workforce, high-quality infrastructure, and favorable government policies, making it an attractive destination for businesses seeking cost-effective and high-quality IT services.
78% of businesses worldwide feel positive about their outsourcing partnerships.
The statistic ‘78% of businesses worldwide feel positive about their outsourcing partnerships’ indicates that a significant majority of businesses have a favorable outlook on their outsourcing relationships. This suggests that a large proportion of businesses are satisfied with the benefits they are receiving from outsourcing services, such as cost savings, access to specialized skills, and increased efficiency. The high level of positivity suggests that outsourcing is a widely accepted and successful strategy for many businesses across the globe, reflecting the perceived value and effectiveness of outsourcing partnerships in achieving business objectives.
IT services currently represent the largest segment of the outsourcing market.
The statistic indicates that within the outsourcing market, IT services hold the highest share in terms of revenue or volume. This implies that organizations are increasingly outsourcing their information technology functions such as software development, maintenance, technical support, and infrastructure management to specialized third-party service providers. The dominance of IT services in the outsourcing market suggests a high demand for expertise in this sector, possibly driven by the complexity and rapid evolution of technology, as well as the cost-efficiency and flexibility benefits that outsourcing can offer businesses. This trend highlights the importance of IT outsourcing in modern business operations.
The global ITO market revenue is set to achieve over 6% CAGR up to 2026.
This statistic indicates that the global market revenue for Information Technology Outsourcing (ITO) is projected to experience a Compound Annual Growth Rate (CAGR) of over 6% until the year 2026. This suggests that the demand for ITO services is expected to steadily increase over the forecast period, leading to a corresponding growth in revenue generated by companies providing outsourcing services. This growth rate signifies a positive trend in the ITO sector, pointing towards a thriving market with expanding opportunities and potential for businesses offering outsourcing solutions to capitalize on the increasing demand for IT services globally.
Application hosting and management holds the largest share in the IT outsourcing segment.
The statistic “Application hosting and management holds the largest share in the IT outsourcing segment” indicates that among the various types of services offered in the IT outsourcing industry, such as infrastructure management, network management, and application development, application hosting and management services see the highest demand and revenue generation. This suggests that businesses are increasingly relying on external service providers to manage and host their software applications in order to reduce costs, improve efficiency, and access specialized expertise. The prominence of this particular service area in the IT outsourcing market underscores its critical role in helping organizations adapt to technological advancements and focus on their core business functions.
59% of businesses use outsourcing as a cost-cutting tool.
The statistic that 59% of businesses use outsourcing as a cost-cutting tool indicates that a significant majority of businesses rely on outsourcing to reduce operational expenses. Outsourcing entails hiring external vendors or contractors to perform specific tasks or functions that would otherwise be carried out in-house. By outsourcing certain functions such as customer service, IT support, or manufacturing, businesses can benefit from cost savings associated with lower labor costs, access to specialized expertise, and increased efficiency. This statistic underscores the prevalent trend among businesses to leverage outsourcing as a strategic approach to improving their bottom line and remaining competitive in today’s global marketplace.
65% of firms that outsource application hosting do so to reduce cost.
The statistic “65% of firms that outsource application hosting do so to reduce cost” indicates that a significant majority of companies choose to outsource their application hosting services primarily for cost-saving reasons. This suggests that for the majority of firms, the primary motivation behind outsourcing this particular service is to achieve cost efficiencies rather than other potential benefits such as access to specialized expertise or improved scalability. By focusing on cost reduction through outsourcing application hosting, these firms may be aiming to reallocate resources more effectively, streamline operations, or benefit from potential cost savings associated with leveraging external service providers for this specific function.
Almost half (47%) of IT leaders will increase their IT outsourcing investments by the end of 2020.
This statistic indicates that a significant proportion of IT leaders are planning to raise their investments in IT outsourcing services by the end of 2020. With 47% of IT leaders intending to increase their outsourcing spending, it suggests a growing trend towards utilizing external resources for IT functions within organizations. This may be driven by factors such as the need for cost efficiencies, access to specialized expertise, flexibility in scaling resources, and enabling internal teams to focus on core business activities. The increased reliance on IT outsourcing signifies a strategic decision by organizations to leverage external partners to enhance their IT capabilities and stay competitive in a rapidly evolving technological landscape.
Large enterprises held over 55% of the IT outsourcing market share in 2019.
The statistic that large enterprises held over 55% of the IT outsourcing market share in 2019 indicates that a significant portion of the IT outsourcing services were utilized by big corporations during that year. This suggests that larger companies have a greater demand for outsourcing their IT functions, potentially due to factors such as cost-effectiveness, expertise acquisition, and focus on core business activities. The dominance of large enterprises in the IT outsourcing market share highlights the importance of outsourcing in enabling businesses to leverage external expertise and resources to enhance their operations and stay competitive in the rapidly evolving technological landscape.
Conclusion
The statistics presented in this blog post clearly demonstrate the significance and growth of the IT outsourcing industry. With an increasing number of businesses opting for outsourced IT services, it is evident that outsourcing has become a crucial component of the modern business landscape. As technology continues to advance and businesses seek cost-effective solutions, the IT outsourcing industry is poised for further expansion in the coming years.
References
0. – https://www.www.deloitte.com
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2. – https://www.www.grandviewresearch.com
3. – https://www.www.statista.com
4. – https://www.www.globenewswire.com
5. – https://www.www.microsourcing.com
6. – https://www.isg-one.com
7. – https://www.www.computerweekly.com
8. – https://www.www.gminsights.com
9. – https://www.www.fortunebusinessinsights.com
