This year the IT services sector will experience many changes. We are convinced that the dominant trend for the selection of the cheapest IT outsourcing services, will irretrievably be gone. Today, IT organizations are looking for strong strategic partners among IT service providers. Progressive automation, data digitization significantly influences the quality of service offered by IT outsourcing companies. Below we have prepared the most up-to-date look at the IT outsourcing industry. If you are looking for a partner in this field or are offering IT services yourself, it’s worth familiarising yourself with the trends below.
Fast Software Development
IT companies are increasingly looking for partners to work with, because rapid development is a priority for them. Most of these companies are rapidly transforming into agile companies that require fast development cycles, close coordination of business, operational and engineering activities. Global acceleration needs to be responsive so as not to fall behind the competition and not to undergo price pressures.
Many companies are increasingly willing to use public cloud data, although some applications still run in dedicated environments because of security or competitive issues. That’s why IT service providers that can easily manage and integrate hybrid cloud environments are the most popular. Many models of software takes the form of specific applications (e.g. SalesForce, WorkDay), which create complications for business operations.
Battles for Talent
Analysts at HFS Research say that recent increases in demand for IT consultants and professionals. This encourages IT service providers to fight for the retention of qualified IT professionals in their company. Recruiting IT professionals and keeping them in the company are becoming increasingly challenging. The emphasis on specific technical skills is becoming stronger, the industry is growing appetite for narrowly specialized employees. IT service providers who wish to compete in the modern market, need to strive harder for their own technical team.
Automation of Processes
At present labor costs based on human labor are reduced in favor of work done by automated solutions. Automation provides greater efficiency and helps overcome problems before they become events that may affect your business operations. These activities increase the value of your business while allowing you to reduce costs. Innovative customers and suppliers are already making their first attempts at automation.
Customer expectations are changing rapidly. Nowadays, negotiations start with a specific business challenge, and potential suppliers are obliged to prepare the best possible solution for the customer. Soon most transactions can focus on specific results that can be measured by business indicators.
Director of KPMG Shared Services and Outsourcing Advisory, Stan Lepeak, noticed that the US immigration reform and Brexit may close many services and local business locations.
IT Outsourcing in the most attractively priced locations is no longer a competitive advantage. Customers want to increase their efficiency through automation. Companies are seeing the biggest increases by improving productivity, not by reducing labor costs. Geographic issues are losing momentum when choosing an IT outsourcing solution. The requirements for suppliers are flexibility, innovation and business problem solving. Currently, location and price are of a lesser importance.