5 Ways BPO Will Change the Business Landscape By 2020
Business processing outsourcing isn't a new idea by any means. For as long as the corporate world has been competitive, enterprises have been looking for strategies with the ability to lower operating costs and improve efficiencies, effectively trying to undercut their rivals while still delivering quality services and products to their clients and customers. This mentality hasn't evolved much in the past century or so, but BPO has.
Now, third-party BPO providers offer even more ways for businesses to reduce their capital expenditures while optimizing the productivity of their organizations. Partly enabled by modern technologies and otherwise supported by tight partnerships with their clients, BPO services have the capability to make any organization a competitive member of its market. As such, the BPO industry is exploding - more and more companies are turning to these solutions for call center requirements, customer services needs, accounting services, technical support and many other processes.
"Organizations will spend a total of $4.71 billion on BPO services in 2020."
According to MarketsandMarkets, the BPO market - called business process as a service by the source - will expand rapidly up until 2020, where MarketsandMarkets' analysis ends. With an estimated compound annual growth of 23.7 percent in the next five years, the research firm predicted that organizations of all sizes will spend a total of $4.71 billion on BPO services in 2020. For comparison's sake, in 2015, companies invested $1.62 billion.
It's clear that businesses will continue to leverage BPO, and once 2020 comes around, the investments made will be unprecedented. This will have a profound impact on the corporate world. But what exactly will change?
Here are five ways BPO will impact the business landscape by 2020:
1. Providing excellent tech support and customer experiences will become the standard to remain competitive.
As businesses hire more BPO services, many of these investments will be made into technologies and services designed to support consumers and their queries as well as provide them with in-depth technical assistance. According to an A.T. Kearney report, by 2020, sales and customer-driven spending will represent 61 percent of IT budgets. This statistic, combined with the fact that 64 percent of those same IT budgets will be allocated toward BPO, proves that customer services and call center outsourcing will be very popular.
Once organizations have third-party service providers managing relationships and interacting with customers, the experience and support bar will inevitably rise - BPO providers take pride in offering those services, ensuring that they provide consumers with excellent interactions and solve problems with maximum efficiency.
2. Enterprise IT will be more agile, cost-efficient and automated, but those departments will exist externally.
Outsourcing IT help desks and other enterprise IT processes are already burgeoning trends, but come 2020, businesses should expect to have a majority of their IT teams working outside the corporation. With BPO today, organizations can rapidly scale their IT departments to meet internal development, tech support and other needs, making outsourcing a logical, cost-efficient business decision.
Besides agility and cost-efficiency, outsourcing will eventually lead to the automation of many IT tasks. As a result, TechTarget contributor Harvey Koeppel asserted that other IT activities - such as tech support - will therefore exist externally.
"By 2020, BPO providers will be more trusted with mission-critical tasks."
3. Organizations will be more focused on the core of their business.
With customer services and call centers outsourced, tech support going external and businesses handling their financial processes to outside firms, organizations in 2020 will only have to rely on the core of their offerings. BPO providers will be more trusted with mission-critical tasks, giving the typical enterprise more revenue, time and other resources to spend on what they do the best. For example, a manufacturing business won't need to create its own internal software, but can instead optimize its product creation.
4. Every corporation will be global organization.
Thanks to cloud services, employees can now access corporate data wherever and whenever they want. In 2020, BPO services will use those same enterprise applications and share data, essentially becoming an extension of an organization despite those providers staff members being located in different countries. This will give the average business a global footprint and possibly even help it compete in that new market.
Once every organization operates on a global scale, local offices and the location of employees doesn't matter - a fact that Koeppel explained. In other words, staff members can work from anywhere.
5. Business will be purely data-driven.
Between customer relationship management systems and enterprise resource planning applications, today's businesses are already collecting more data than they could possibly analyze. In 2020, all BPO providers will be leveraging these technologies and many others when they interact with clients and internal employees, giving organizations a near unlimited source of information and insight. Factor in the Internet of Things, and it's clear that data will steer corporate decision-making processes, possibly even inspiring companies to outsource more competencies.
Five years ago, many businesses simply assumed that BPO would offer the standard benefits of efficiency, better customer services and improve productivity, but in the next five years, those organizations can expect BPO providers to truly shake up the corporate world.