IT Outsourcing Vs. BPO

Filed in archive Outsourcing News on October 21, 2006

It's the outsourcing battle.

Recent statistics have shown that the rate of IT outsourcing has been rapidly declining over the past years. The rate for IT outsourcing has dropped to 2% as compared to the same period last year. Though IT outsourcing has showed some cooling off, BPO (Business Process Outsourcing) has showed considerable growth showing a 10% increase of BPO-related contracts.

The shift from IT outsourcing to BPO was considered as "related matters" by TPI managing director Duncan Aitchison. The managing director mentioned that:
"As organisations place more and more processes in the hands of third parties they no longer require the associated infrastructure and hence have less IT to outsource."

One of the reasons why the rate for IT outsourcing has dropped was because of the shorter contracts in IT outsourcing. If you ask me, the shift is totally expected as companies realize the best strategy in maximizing their outsourcing benefits.