Stamford information gatherers see outsourcing on the rise.
Information Services Group in Stamford and its sourcing data and advisory company TPI, located in Texas, have released research predicting the number of outsourcing contracts awarded globally will rise in 2010. The information came in the recently released Momentum Market Trends and Insights fourth quarter 2009 annual report.
“The question on many outsourcing professionals’ minds entering 2010 was whether the fourth quarter of last year was the typical end-of-year bounce or the beginning of a recovery in the industry,” said John Keppel, partner and managing director of TPI Research. “We believe it was both. With the outlook of the global economy still uncertain, clients are clearly turning toward smaller, lower-risk transactions that focus on short-term cost savings.”
Keppel said outsourcing is the major option as organizations look for new ways to optimize critical business operations in an improving economy. Keppel said the growing acceptance of cloud computing, increasing interest in multisourcing, and emerging focus on governance and risk management will fuel the volume of outsourcing contracts.
Keppel said the companies”™ report also shows these same factors narrowing the scope of individual outsourcing projects, driving down their value and duration and intensifying competition among service providers.
The report also notes that 422 outsourcing contracts valued at $15 billion are expected to expire in 2010. Many are large contracts signed when the world”™s economy was stronger. Keppel said the contracts will be broken up and awarded in smaller transactions, providing another boost to contract volume.
