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IT Outsourcing Trends for 2023

It outsourcing trends for 2023

IT Outsourcing Trends to watch out for in 2023

With technology pushing the limits to better working and business mechanisms, the IT realm is undoubtedly playing a vital role in this upcoming change.

The year 2023 seems to be the apple of everyone’s eye. Industrial big wigs might as well have it marked on their calendars for reasons far important than the beginning of a new decade.

There’s the World Expo being held in Dubai. Ultra-thin OLED screens will be implemented. Japan will build its very own robotic moon base.

But what does the coming year mean for IT outsourcing services?

Read on to keep yourself updated with the trends we will witness next year.

What does this industry have in store for outsourcing in the future?

Ever since the term Information Technology’s first appearance in the Harvard Business Review in 1958, it has left a lot to the imagination as it still does.

So, what are the latest trends that the IT sector will target in the coming years? They are:

Progress in advancing IT skills

Technology is an ever-evolving paradigm. This, with the combination of a highly competitive market, IT firms are always on the lookout for how best they can innovate their solutions better than their counterparts.

Industrial sources have indicated that the IT expenditure in 2021 has increased by 3.2 percent compared to 2020. One of the primary reasons? Lack of in-house IT expertise.

This shortage in inhouse talent will further shoot up the pressure on outsourcing, for companies that are determined to stay afloat.


IT outsourcing trends for the year 2023

What can we expect?

Upon analyzing industrial surveys and data, it can be said that one of the major intentions the majority have their minds is on implementing AI and RPA to a much larger extent than before.

The only question that remains is – will it be successful? Well, we’ll just have to wait and watch.

Trend #1 – Switching boundaries

India and China have been torchbearers in the IT outsourcing arena for the past couple of years. But, it seems as though that will soon change in the next decade.

CEE (Central and East European) countries are being prepped for the next best alternative replacement to their Asian competitors. According to a McKinsey report, this has been an ongoing process since 1990.

The O&O (Outsourcing and Offshoring) industry in the CEE region has been garnering attention for its ability to provide an efficient workforce for comparatively lower labor costs that the EU – 15. 65

Trend #2 – Innovative tech will boost

To keep up with the heavy competition in the market, service providers would be driven if not coerced into implementing an innovative framework to give them an added advantage.

But this is going to require a lot of hard work in terms of identifying key value-maximizing strategies, demolishing external and internal limits in a manner that prepares providers to go after said innovative technology and makes the best out of it.

Trend #3 – Customer-Centric Approach

In a recent survey, outsourcing clients and providers suggested that one of the most important reasons for IT outsourcing was to imbibe an effective customer service solution to their preexisting system.

Hence, it can be said that moving forward, service providers might increasingly develop outsourcing services that target improved customer engagement rather than just aid clients in their cost-cutting agenda.

Trend #4 – Specialization

With the market representing a sea of a multitude of options, it is easy for a provider to propagate the efficacy of their services as master of all.

In reality, however, the scenario is much complex. The onset of 2020 customers and providers alike will focus on information and data-oriented services as a priority since the outsourcing industry will open up to new possibilities and opportunities in that area.

The specialization will become the new age buzzword with the injection of technology making it possible for newer services to emerge as well.

Trend #5 – Moving towards an experience economy

As the Harvard Business Review puts it an experience economy is where “a company intentionally uses services as the stage, and goods as props, to engage individual customers in a way that creates a memorable event.”

The IT outsourcing sector in the future will have to do more than just provide above par services, they’ll have to give clients an experience worth banking on. This means that aspects that were previously disregarded as immaterial such as storytelling, design, aesthetics, etc., will now have to be put in the forefront.

Additionally, prioritizing on service design that taps into a client’s emotional centers will also be a possible trendsetter in this field.

Trend #6 – Contracts

A survey conducted by GSA UK indicated that almost 90% of the respondents believed that clients and service providers in the IT outsourcing realm will be signing contracts especially with regard to optimum outcomes.

Additionally, the survey also suggests that risk management would be embraced as a collaboration between the client and the provider rather than the latter having to take complete responsibly of the same.

Trend #7 – Collaboration Over Competition

Speaking of contracts, changes are being made to make them precise and accurate in terms of procurement and outcomes. While this is the case, the contracts will also give scope for a collaborative effort between the customer and the providers.

Both parties also agree for a mutual understanding of risk-sharing partnerships where they can both bear the brunt of any mishaps or open themselves to myriad benefits as a result of the same.

Trend #8 –  Distinctiveness

Using RPA (Robotic Process Automation) and AI (Artificial Intelligence) is uncommon in the IT sector so, providers are constantly rushing to give their clients a unique solution that they might not find anywhere else.

Not only does this expand the market to newer possibilities but also motivates other players to do better, hence aiding the system’s progression in its entirety.

Though these trends will further evolve into newer ones, for the time being, the industrial data and surveys identify these as some of the major changes that will transform the IT outsourcing industry for good.

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