Outsourcing Trends of 2020

Outsourcing Trends of 2020

Outsourcing remains as one of the most competitive industries today, attracting clients and potential employees alike. Fresh and exciting trends are poised to take over this 2020 and reinforce the sector’s place in the economy. Here are some of them.

Shifting focus

In the past, companies outsourced for the main reason of slashing service costs such as IT and accounting. According to the Global Sourcing Association in the UK, 35% of clients see the reduced expenses as the primary motivation for the global boom of outsourcing. Around 23% of the respondents see customer service improvement as another motivation to hire offshore workers.

Outsourcing companies need to bank on better customer relations since 51% of clients tend to stop doing business after just one negative experience. As a result, the year 2020 will likely shift the focus from a cost-effective perspective to a customer-centric approach, as many outsourcing agencies highlight exceptional services for end-users.

It is also estimated that 85% of interactions with the customer will use automated channels in 2020. Customers will expect a customized and efficient experience from service providers who must specialize their treatment to win more customers.

Outsourcing service specialization

Technological advancements have benefited almost every market, including outsourcing. In 2020, new market opportunities in different service areas will be made more robust for providers and customers alike. For example, a company may focus on providing outsourced services to gaming businesses, gaining referrals and improved portfolio for developers and other gaming professionals.

Additionally, data- and information-centric clients will open up to a specialized outsourcing area that will encourage industry players to tailor their services in the collection or processing of such data.

International expansion, stiffer competition

The IT outsourcing industry keeps growing year after year, with new players entering the market regularly. In 2018, the customer experience sector globally outsourced a total estimated value of $75.1 billion, and this number is projected to rise to $82.6 billion in 2020.

Businesses today have an array of options that weren’t there a few decades ago. International powerhouses in the industry from India, China, Ukraine, Argentina and Poland will be met with competition from Eastern Europe and Latin America.


The focus on enhanced customer experience in 2020 affects how outsourcing providers and clients shapes the industry. This year, businesses lean more toward providing value and positive outcomes, which is shown in a GSA UK study. Almost 90% of the respondents believe that outsourcing contracts will emphasize these qualities within the terms.

The data further reveals that only 31% of providers shoulder the risks solely, while 69% of the respondents see providers as system integrators, sharing the risk to a certain degree with the client themselves.

Best practices for contracting in the outsourced industry include integrating features that protect both parties. The key to a successful outsourcing relationship is addressing the complexity and full scope of decision-making. Some of the issues that need to be tackled are service level agreements, vendor exclusivity and transition services in the event of termination, among others.

Multi-vendor trend

With contracts focusing more on results, service providers will build bridges with other outsourcing companies. Collaboration between different vendors will enable clients to widen their reach. This trend will help cut expenses across markets and provide better IT solutions for end-users. The multi-vendor trend will increase industry standards for 2020.

Reverse outsourcing

The ICA Institute in Atlanta held an event, “Global Outsourcing 2020,” that suggested new outsourcing opportunities. There has been a debate on reverse outsourcing, which is set to become a key trend in the industry.

Reverse outsourcing occurs when a foreign outsourcing company employs skilled American workers who have a better grasp of the US markets, leading to higher customer penetration. It will also help cut visa and travel costs for employees.

Cloud outsourcing

The cloud has changed the way businesses deal with data. Companies integrate the cloud in day-to-day services, and it is likely that in 2020, 85% of business workloads will be utilizing the cloud. Many outsourcing companies use one-stop platforms that offer assistance to enable the handling of multiple programs at a time.

The industry will witness the flourishing of security and storage projects, which can all be accomplished through cloud-based platforms.

A Values-driven Service Provider

Outsourcing providers should stay updated with market trends to remain competitive in an already saturated market. In 2020, a customer-centric approach will be shaping outsourced services, which could be strengthened when the company learns to uphold trust and transparency. Investing in new technologies and enhancing data security will matter more in the industry. Getting a head start in the new year means adopting a flexible workflow for outsourcing agencies that want to cement their place in the industry.

Are you a growing business that needs outsourcing services? Yempo can help you! Visit our website or contact us today to know more about our outsourcing services.