Global outsourcing industry - additional information
Outsourcing is the contracting out of processes to external parties. Business process outsourcing (BPO), which generated 24.6 billion U.S. dollars worldwide in 2017, involves transferring business processes to service providers outside of an organization. This process often requires offshoring. In 2017, India was the best country for offshoring when its financial attractiveness, the skills and availability of its people and its business environment are considered together. Information technology outsourcing (ITO) is closely related to business process outsourcing as many business processes are technology based. In 2017, global ITO revenue was 64.3 billion U.S. dollars.
The global revenue of business process outsourcing and information technology outsourcing amounted to around 88.9 billion U.S. dollars in 2017, of which more than half was generated in Europe, the Middle East and Africa. Southern Europe was the region with the largest share of businesses practicing, or planning to practice, business process outsourcing. Latin America and South Africa also had high proportions.
Business process outsourcing includes delegating back-office or internal functions, like HR and accounting, and front-office or customer-related functions, such as those that would be passed on to call centers. In 2016, most companies used outsourcing services as a cost cutting tool while communication was a main driver of a successful outsourcing experience among mid-market business leaders worldwide.