New Trends in Outsourcing 2019

When outsourcing services were first offered, companies were driven by the prospect of cost reduction. Today, that reason is changing as companies realize outsourcing’s other benefits, enabling the global business process outsourcing (BPO) services market to grow at a rate of 10.8% year and possibly reaching US$335.23 billion value from 2017 to 2024, according to Market Research Future.

Global Outsourcing Trends

Because cost will still be a major factor for outsourcing, companies will be helped by checking cost comparisons and guides. But let’s look at the other outsourcing trends that are rising this year in specific industries.

Information Technology

A Forbes report showed that IT was the most outsourced function among all others at 74% of all surveyed firms. “The Edge Foundation, an independent education foundation, calculates that the U.K. economy loses £63 billion annually due to around 600,000 tech job vacancies. Businesses will continue to rely on outsourcing partners in Asia to fill those costly IT talent gaps,” the report added.

Specifically in software development outsourcing, companies that employ the service will become more human- and process-driven, rather than being focused on price factors.

Tax Compliance

As the process of tax compliance has become increasingly complicated and automated, many companies are seeking expert assistance from outsourcing companies. A survey by Deloitte shows that 56% of the companies surveyed were taking advantage of this strategy.

Human Resources

“The trend for outsourcing HR is already underway. That’s why we see the growth of the “professional employer organization” model and a surge in consultants with HR expertise areas on the rise,” a recent Forbes article explains. With employees changing companies often, there is a shortage of qualified HR staff to fill the positions. Another complicating factor is now that HR is confronted with many new laws and regulations, it is difficult for in-house employees to keep up with all of the requirements. Many companies are solving this problem by outsourcing to an expert firm.

Financial Services

“Adopting effective growth strategies and integrating with FinTech will be essential to partner for innovation. Partnering with FinTech companies is up from 32% in 2016 to 45%” in 2017, outlines PWC, “with 82% on average, expect to increase partnerships with FinTech companies over the next three to five years.”  In many cases companies are selecting outsourcing expertise in the Philippines as their knowledge in this area grows.

On the other hand, service providers are tasked with fraud prevention responsibilities. An independent, external financial consultant will be able to discern irregularities with or divergence from financial standards, making fraud less likely to happen. Small and mid-sized enterprises meanwhile benefit from the expertise of qualified chartered accountants and other financial specialists that they are unable to employ.

Sales and Marketing

The emergence of digital marketing roles has necessitated the creation of small internal teams. However, some companies choose to outsource this specialist skill especially if the role calls for automation. It is crucial to employ specialized local agencies, especially if clients intend on sustaining marketing campaigns.

As per McKinsey, “by 2020, customers will manage 85% of their relationship with an enterprise without interacting with a human, and 40% of sales activities could be automated using technology that already exists,” reports Forbes.


Administrative tasks are usually performed internally as they cannot be outsourced without clear policies and procedures. With technology advancement, outsourcing this practice is becoming more popular through the employment of virtual assistants.  “

Core Business

A very interesting trend for 2019 is outsourcing the core aspects of a business. Now that many companies have developed a very positive relationship with an outsourcing company, they have the confidence to trust some of the core aspects of their business to these enterprises. “IT outsourcing vendors will act as genuine partners who will bear the responsibility of niche-based knowledge,” informs the Business website.

Philippine Outsourcing Trends

In the Philippines, a top location for many world-class outsourcing providers, several trends are emerging or continuing:

  1. Time Doctor predicts that new technologies will make inroads into the BPO offerings with the emergence of process automation, social media management tools, and cloud computing. The report indicates that about 700 thousand medium and high-skill jobs would be created by 2022.
  2. The Philippine government is helping to upskill professionals and helping them with job placements to fulfill current demand. The Information Technology and Business Process Association of the Philippines plans to launch a new career portal and eLearning website to provide courses that are relevant to the emerging job market, explains BusinessWorld.
  3. Startups will seek BPOs to meet their needs. Startups often have a very tight budget but require expert services. They may hire virtual assistants (VAs) for cost effectiveness. They will also hire outsourcing companies that have specialized services tailored to their needs. In fact, one business guru Peter Drucker says it best, “Do what you do best and outsource the rest,” as referenced in this Medium article.
  4. Greater transparency in the BPO process results in expanded partnerships. Now that the outsourcing business has matured, many companies are increasing their reliance on these services. Their continued positive experiences in the process builds mutual respect for the relationship. Some firms are even building partnerships so that as various projects prosper so do the rewards for both companies.
    One area in which there is a huge demand for partnerships is AI. The gap between ambition and execution is large at most companies. Three-quarters of executives believe AI will enable their companies to move into new businesses. Almost 85% believe AI will allow their companies to obtain or sustain a competitive advantage, outlines MIT.
  5. Continued growth for the local outsourcing industry is expected. The Philippine IT-BPMRoadmap 2022 sees the industry as reaching a revenue of about $38.9 billion, keeping its position as a key contributor to the global industry.

How Will Outsourcing Work for Us?

Are you looking for a service provider to outsource some of your company functions? To gain insight into a service provider’s experience, examine their case studies in your area of business. Undoubtedly, cost will be a determining factor, but more positive aspects will allow you to embark on this new way of conducting business.

At Yempo we make the process of outsourcing transparent, cost-effective and suited to your needs.  Contact us today to learn how we can help you.