Employee Incentive Deep Dive: Awardco Review
As the majority of the workforce remains disengaged, enhancing employee recognition through incentive platforms like Awardco emerges as a solution.
In This Post:
BPO is an abbreviation for business process outsourcing. It is contracting another firm to do a procedure that the company needs to function. To put it simply, when a company hires a third party to manage its non-core business operations, they engage in business outsourcing. Here are the latest BPO statistics, trends, and facts:
General BPO Statistics
- The worldwide business process outsourcing market was estimated at $245.9 billion in 2021 and is predicted to increase at a 9.1% compound annual growth rate (CAGR) from 2022 to 2030. (Grandviewresearch, 2021)
- The military industry accounts – the most significant outsourced transactions — earned $100 billion in income. (City University of New York, 2009)
- 40% of help desk employment in the banking business is outsourced. (Credit Donkey, 2015)
- Before the pandemic, the worldwide outsourcing market was worth $92.5 billion. (Statista, 2019)
- Every year, around 300,000 jobs are outsourced from the United States. (Zippia, 2022)
- To improve outsourcing, more than 93% of firms are contemplating or have already implemented the use of cloud services. (Deloitte, 2018)
- Data security is a key issue for 68% of outsourced organizations contemplating cloud computing. (Digitalguardian, 2020)
- The global financial services outsourcing market is valued at more than $130 billion. (Fortunly, 2021)
- 29% of businesses with fewer than 50 employees outsource, compared to 66% with 50 or more employees. (Fortunly, 2021)
- 24% of small businesses outsource to improve efficiency. (Fortunly, 2021)
- The most commonly outsourced jobs in small businesses are accounting and IT services. (Clutch, 2021)
- 52% of executives say they outsource business functions. (Deloitte, 2022)
- 76% indicate that they outsource IT functions. (Deloitte, 2022)
- 89% of companies develop or deploy their cloud services via service providers. (Deloitte, 2022)
- 96% of executives report using third-party data and analytics providers. (Deloitte, 2022)
- The top qualities that companies value in a service provider are transparency (54%), trustworthiness (41%), understanding of the business (36%), proven results (36%), and clear and frequent communication (33%). (Deloitte, 2022)
- In 2022, the average spending of SMBs on outsourcing was $198,550. (Clutch, 2023)
- 52% of small companies regularly use a firm or an agency for outsourcing. 45% use freelancers, and 45% use consultants. (Clutch, 2023)
- The three most important factors for small organizations when choosing an outsourcing provider are price, industry experience, and team diversity. (Clutch, 2023)
- In 2023, the business process outsourcing market is anticipated to generate US$0.35 trillion in revenue. (Statista, 2023)
- Market volume is projected to reach US$0.45 trillion by 2027, with revenue predicted to expand at a 6.48% annual rate. (Statista, 2023)
- In the business process outsourcing market, the average spend per employee is expected to reach $100.50 in 2023. (Statista, 2023)
- In terms of worldwide comparison, the United States is expected to produce the most significant revenue of $129.70 billion in 2023. (Statista, 2023)
Why Do Companies Outsource Processes?
- Outsourcing procedures help organizations focus on key processes, according to 57% of businesses. (Digital Learning, 2019)
- 78% of firms have a favorable connection with their outsourcing partners. (Deloitte, 2021)
- While cutting costs is a primary reason why 57% of companies outsource processes, access to new capabilities (51% of organizations) and keeping up business strategy and operating model shifts (49%) are vital drivers of traditional outsourcing. (Deloitte, 2022)
- The primary drivers of managed services are the increasing pace of technology and digital transformation (62%), gaining access to new capabilities (56%), and the rising and more complex cybersecurity threats (54%). (Deloitte, 2022)
- 49% of executives say they opt for operating services to gain access to new capabilities, 46% implement them because of business strategy and operating model shifts, and 45% believe they are vital to changing regulatory requirements. (Deloitte, 2022)
- The main reason why small businesses outsource tasks is to reduce expenses and bring industry experience onto the team. (Clutch, 2023)
What are the Outsourced Business Processes?
- 37% of businesses outsource their accounting functions. (Clutch, 2019)
- IT services are the largest outsourced process, accounting for 37% of all outsourced operations. (Clutch, 2019)
- Following accounting and IT services, 34% of firms outsource Digital Marketing tasks. (Clutch, 2019)
- Lead creation and cold calling are two more operations that are frequently outsourced. (Sopro, 2021)
- To save money, 28% of businesses will outsource company development. (Deloitte, 2020)
- The five most outsourced business processes are legal functions (64%), tax (61%), HR (57%), finance (51%), and manufacturing and supply chain procurement (48%). (Deloitte, 2022)
- IT functions are even more outsourced, with companies using external providers for cybersecurity (81%), app/software development (79%), IT infrastructure services (77%), next-gen tech (78%), data analytics (75%), app support (73%), and helpdesk and user computing (68%). (Deloitte, 2022)
- In 2023, small businesses will look for new outsourcing providers in marketing (27%), IT services (22%), and design (21%). (Clutch, 2023)
Outsourcing Statistics that Show the Impact of BPOs
- When attempting to move to cloud infrastructure, 68% of businesses encounter problems with BPOs. (Customerthink, 2020)
- 35% of firms are always concerned about the data exchanged with outsourcing agencies. (Customerthink, 2020)
- Despite their reservations, 44% of chief intelligence officers are eager to interact and exchange data with outsourcing firms. (Customerthink, 2020)
- The negative impact on company culture is a top third-party selection worry for 22% of executives. (Deloitte, 2022)
Concerns About Outsourcing
- When attempting to move to cloud infrastructure, 68% of businesses encounter problems with BPOs. (Customerthink, 2020)
- 35% of firms are always concerned about the data exchanged with outsourcing agencies. (Customerthink, 2020)
- Despite their reservations, 44% of chief intelligence officers are eager to interact and exchange data with outsourcing firms. (Customerthink, 2020)
- The negative impact on company culture is a top third-party selection worry for 22% of executives. (Deloitte, 2022)
Statistics Showing a Bright Future for BPOs
- 65% of organizations that use BPOs for application hosting are eager to increase their outsourcing investment. (Customerthink, 2020)
- In India alone, the information technology BPO business generated $154 billion in revenue in 2017-18. (Brandongaille, 2020)
- 57% of companies use business process outsourcing to concentrate on core issues, operations, and activities (Statista, 2021).
- Approximately 54% of businesses employ at least one third-party support staff to communicate with consumers (Fortunly, 2021).
- Currently, 74% of firms use the business process outsourcing industry for their information technology needs. (Statista, 2021)
- 65% of firms that utilize BPO for application hosting expect to raise their spending in the coming year. (Intelligent Bee, 2022)
- 67% of companies will increase their budget for operating services, 57% will invest more in managed services, and 32% plan to spend more on traditional outsourcing. (Deloitte, 2022)
- 83% of small businesses plan to keep or increase their BPO budget in 2023. (Clutch, 2023)
Human Resources & Customer Service
- Today, more than 40% of banking and financial institution support desk employment is outsourced. (Deloitte, 2021)
- 24% of businesses say that outsourcing HR and customer service allows them to focus on core operations. (Fortunly, 2021)
- Due to today’s business requirements, organizations spend significant time and money on accounting operations. As a result, accounting is the second most outsourced emphasis area, with 37% of organizations outsourcing their accounting procedures to BPO. (Clutch, 2019)
Conclusion
These BPO statistics show that businesses see outsourcing as more efficient than employing and paying a full team. In some cases, a more specialized organization can perform a business task better than the company can handle it in-house.
Written by shorlister editorial team
Business Process Outsourcing Providers (BPO)
Browse our curated list of vendors to find the best solution for your needs.
Stay Informed
Subscribe to our newsletter for the latest trends, expert tips, and workplace insights!
Share on facebook
Share on linkedin
Share on twitter
Related Posts
Best HR Tools for Companies in 2024
Struggling to navigate the maze of HR tools available in 2024? Our review highlights leading solutions for transforming employee management.
Creative Employee Incentive Ideas for Motivated Teams
From traditional benefits to personalized rewards to creative team challenges, these employee incentive ideas can motivate individuals and teams, leading to better performance and organizational growth.
Why do We Hate HR?
HR should be one of the company’s most helpful and valuable departments. However, for most employees, that is not the case.