admin Business Process Outsourcing (BPO) is the practice of contracting with an external service provider to perform essential business task, according to TechTarget. Call centers are a type of BPO service. Administrative tasks such as outsourcing payrolls, accounting is carried out by BPO’s. The global business process outsourcing market size was valued at USD 261.9 billion in 2022 and is projected to expand at a compound annual growth rate (CAGR) of 9.4% from 2023 to 2030.
There is high demand for these types of service due to their benefits which include increased flexibility, reduced cost, enhanced service quality. Owing to these benefits, BPO services witness demand across end-use industries such as healthcare, BFSI, and IT & telecommunications.
The growth of business process outsourcing market is driven by, rising focus of enterprises on improving efficiency and organizations’ agility, reducing operating costs, and accelerating core competencies to survive the constantly changing business dynamics.
The demand for standardized platform services which offer BPOs to resolve complex business processes, during COVID generated avenues for business process outsourcing market growth.
Cloud Computing in BPOs
Cloud computing assures immediate computing support and system access, universal access, flexible provisioning whenever needed for business purpose.
Cloud computing helps BPO operators in increasing time to market, reducing costs, and improving quality. Businesses have realized the importance of continuous operations planning and disaster recovery to build a more reliable business model that can survive an unprecedented disruption like the COVID-19 pandemic.
Insights of Service Provided
With a revenue share exceeding 30% the customer services segment in 2022 dominated the market. The segment is anticipated to retain its dominance and lead the CAGR in the forecast period. Customer service-based business process companies are specialized in handling customer requirements and queries that are generated through social media platforms, chats, phone calls, emails, and other channels. Furthermore, most of them provide self-service support, so customers find answers to their queries at any time.
The segment that is predicted to witness significant growth over the forecast period is the finance and accounting segment. Due to the rising need for resources across areas such as payment processing, recruitment and relocation, administration, and other employee benefits services, the human resource service segment is anticipated to grow substantially in the forecast period.
Understanding the Path that Leads to Successful Growth
Accounting around 34.0% of the overall market, the IT & telecommunications segment held the largest revenue share in 2022. Rapid industrialization globally and increasing of IT businesses are some of the factors that are boosting the demand for BPO service.
Their demands are mainly for connectivity, address security issues, and innovation of new offerings for the latest devices and tech standards. Outsourcing is a great factor for telecom companies to reduce capital expenses, optimize current investments, create flexible strategy for acquiring more customers and manage cost pressures.
The BFSI segment is likely to witness the fastest growth by 2030 and a CAGR of over 10.0% in the forecast period. Financial institutions are adopting BPO as an instrument to improve their cost efficiency. The key market players that dominated the global market in 2022 include Accenture, Amdocs, Infosys Limited, HCL Technologies Limited, CBRE, Wipro, and Capgemini. Companies engage in inorganic growth strategies such as mergers & acquisitions, partnerships, and geographical expansion to stay afloat in the highly competitive market.
In October 2021, Amdocs signed a seven-year partnership with VEON Ltd., a connectivity and internet service provider, to offer innovative digital services to customers of VEON from Uzbekistan and Kazakhstan.
Companies focus on marketing trends to develop technologically advanced and differentiated services to gain a competitive edge. The rising flexibility of business process outsourcing services is helping strengthen market growth as several end-use industries, including IT and telecom, healthcare, banking, financial services, insurance, and manufacturing, employ these services.
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