The global Business Process Outsourcing Market size is projected to reach USD 435.89 billion by 2028, registering a CAGR of 8.5% during the forecast period, according to a study conducted by Grand View Research, Inc. The demand to reduce operational expenditures associated with non-core activities and increasing focus on core competencies across several end-use verticals are factors contributing to the market growth. Moreover, the increased preference of new-age organizations for handling core business functions in-house and outsourcing support functions to third-party vendors for better growth prospects are expected to drive the market.
Digital technologies are creating lucrative opportunities for several business leaders. Long-established operations and business process outsourcing (BPO) models are being renewed through more intelligent workflows using, such as cloud, Artificial Intelligence (AI), automation, and Internet of Things (IoT). To grow and remain relevant, businesses are required to constantly evolve to fully orchestrated and intelligent processes that consider employees, customers, business partners, and suppliers alike.
An increasing number of BPO service providers are making greater use of these technologies to boost the efficiency of their services. Major service providers are also anticipated to use technological innovations to efficiently manage talent shortages, enhance products and services, and address market challenges while keeping operating costs low for their clients. Robotic process automation has emerged as a fast-growing trend in the market, particularly in the management sector, providing high-value creation with fast time-to-market and notable cost savings.
Although the market is projected to grow significantly over the forecast years, companies express concerns about high dependency on external outsourcing service providers; dependency poses a potential security risk related to the confidentiality and integrity of user data. Preserving and maintaining the confidentiality and integrity of user data is a vital concern that is common for all companies. In addition, the lack of effective frameworks to ensure the quality of service and rising budgetary pressures are some of the key factors restraining the growth of the market.
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Business Process Outsourcing Market Report Highlights
- On basis of service type, the demand for BPO solutions in the human resource segment is expected to register the second-fastest CAGR over the forecast period
- The rising need for aligning HR and business operations, compliance management, changing policy framework, cost reduction, and access to key technologies is boosting the demand for BPO services in the HR sector
- In 2020, the IT & telecommunication segment accounted for the highest revenue share and expand further at a steady CAGR from 2021 to 2028
- BPO solutions help telecom companies establish a flexible strategy to acquire and retain more customers, access specialized resources, optimize current investments, and manage cost pressures
- The Asia Pacific market is expected to witness the fastest CAGR during the forecast period
- Increasing demand for talented professionals, reduced labor costs, and significant digital investments by leading vendors, such as HCL Technologies Ltd., Infosys Ltd., Accenture, and Wipro, are expected to drive regional market growth
- Moreover, infrastructure investments by government bodies are expected to provide growth opportunities to the market