The global IT outsourcing market, valued at $333.7 million in 2019, is expected to reach $297.6 billion by 2025, with IT becoming a key way for businesses from a wide array of industries to remain competitive. Global events taking place in 2020 have strengthened the reliance on outsourced IT professionals, with recent research by McKinsey indicating that in the post-pandemic world, three to four times as many people could be working from home than in the past. This will have a profound impact on everything from roles within companies to the extent to which various services – including marketing, communications, and IT – are outsourced.
Savings Made By Outsourcing IT Services
Around 40% of companies in the U.S. plan to increase their reliance on outsourced service, according to Ignite Outsourcing, which reports that companies can look to save around 30% of operational costs by doing so. Small and medium businesses generally have one technical support worker for every 50 users. It is easy to see that once this number is surpassed, more IT professionals have to be hired, and the average cost of hiring a full-time IT employee in the U.S. is in the region of $51,838. Companies may also need to hire new employees when specialist services are required. As stated by IT experts Taylored Systems, outsourcing IT services give businesses access to the expertise of specialists working in a bevy of areas – including cloud services, IT security support, wireless access, firewall and router support, large-capacity data storage, and backup and disaster aid.
The Influence Of The Cloud On Outsourced IT Services
IT outsourcing is motivated by much more than cost savings. Goals such as business growth, improved customer experience, and competitive disruption require features such as internet speed, security, quality, and efficiency. Cloud migration and new modalities in the cloud services sector have also led companies to seek professional guidance in order to grow their business and improve customer experience. As small and medium businesses embrace digital transformation, they may wish to invest in cloud-supported services like cloud-supported subscription plans with AI and IoT features, chatbot customer support, and other AR/VR features. They may also wish to switch from hardware to apps, which can be accessed via a browser or mobile apps, thus saving on expenditure on servers and IT equipment. Outsourced specialists can advise businesses on these and other matters – including advanced security.
New Expectations Driving IT Outsourcing
The report Global IT Outsourcing Market 2020-2025 – Growing Demand for Efficiency and Scalable IT Infrastructure – ResearchAndMarkets.com indicates that one of the top reasons that even bigger companies (including banks and financial institutions) are opting to outsource IT services is the increasingly sophisticated nature of their customers’ demands. For instance, customer demand for customized access to banks’ services can be met by outsourced partners who can oversee the migration to omnichannel platforms that can easily be accessed from any device. As stated by the authors of the report, “Such platforms facilitate real-time data collection and analysis so that financial institutions can improve customers’ experience. Hence such developments are driving IT outsourcing in the banks.”
Because dedicated IT management firms are purely centered on all branches of this industry, companies relying on their services can reduce the risk of relying on obsolete technologies. Although trends in the industry are constantly changing, currently, robotic process automation and AI are key in terms of chatbot development and automatic document management. So, too, are services such as FaaS (function as a service) – a type of cloud computing service that enables cloud application developers to execute code in response to events without the complex procedures traditionally involved with creating microservices applications. FaaS essentially cuts corners by enabling the cloud service provider to automatically deal with web server software management, hardware, and virtual machine operating systems.
The big boom in remote working has led many companies from a plethora of sectors to outsource services such as marketing, IT, and administration. When it comes to IT, cost savings are a big motivator. So, too, is the ability to enjoy more efficient cloud management services and to stay on top of new services such as FaaS, which allow users to execute code more quickly than in the past.