Despite the fact that organizations worldwide are deferring capital expenditures, outsourcing continues to be the number one tool chosen to drive organizational change, according to EquaTerra's Advisor and Pulse Survey.
The findings show demand for outsourcing is outpacing business investments in areas such as hardware, software or other types of more discretionary project-based services. The Pulse survey also revealed that the focus is shifting from long-term initiatives aimed at improving end-to-end business processes and moving toward efforts that deliver quick return on investment and facilitate short-term business objectives that bring immediate cost savings.
Other key findings of the survey show that 38 per cent cited economic conditions as causing buyers to slow or defer outsourcing efforts, the highest level cited over the past three quarters. However, 42 per cent of overall survey respondents indicate economic conditions are driving more outsourcing, despite slowness in certain market sectors. Half of the service providers polled reported more aggressive pricing indicating that increased price competitiveness is a manifestation of tight market demand, increased competition for deals and more demanding buyers.
The article also argues that because of globalization, technology and financial forces, outsourcing has gained ground as a strategic change initiative. According to Stans Lepeak, EquaTerra’s managing director of global research, "Over time, buyers will likely adopt a global, cross-functional or portfolio-based governance approach”. He also adds that "Developing and adopting standardized outsourcing governance operational models, investing more in skilled personnel and leveraging software tools to automate and improve governance operations will be central to achieving business case objectives for multi-provider outsourcing efforts."
Sources for this article can be referenced by contacting the author or by accessing the links found in the bio section of this article.
Dr. Joe Greco is Director for the Center for the Study of Emerging Markets (CSEM) located in Fullerton, California. As part of the Mihaylo College of Business and Economics at California State University, Fullerton, CSEM was established to promote the flow of global information and technology between the academic and business communities. In particular, CSEM studies the economic and cultural impact of offshore outsourcing on emerging markets. You may contact Dr. Joe Greco at 714-278-4125 or csem@fullerton.edu
Sources for this article:
http://www.itnews.it/news/2008/1029090601885/recessionary-climate-expected-to-fuel-demand-for-outsourcing-initiatives-into-2009.html
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