Technology Outsourcing Statistics & Trends

Global IT services (in-house and third-party) were valued at $715.93 billion in 2020, according to Grand View Research. In 2020, the global market for IT outsourcing (ITO) is expected to be worth $556.67 billion, or 77.75 percent of the total.

The ITO market’s CARG is 7.7 percent, while the IT services market is 8.4 percent. IT services and ITO are estimated to be worth roughly $1,070.28 billion and $ 806.63 billion respectively by 2025. Even at 75.37% of the total IT services market, this still represents a significant share.

The use of third-party service providers to supply IT-dependent business processes, application services, and infrastructure solutions is known as information technology outsourcing (ITO).

Outside suppliers or service providers frequently execute aspects of internal work that would otherwise be conducted in-house. This is what is meant by “outsourcing” in its broadest sense.

Outsourcing can be used to handle a wide range of jobs and services. Programming and application development, as well as technical assistance, are examples of IT services that can be outsourced.

IT departments might be completely outsourced to larger organizations with in-house expertise and a specialized workforce. As a result, businesses are able to cut back on overhead and concentrate on what they do best.

One of the world’s most sought-after outsourcing Industries is India’s. A business can free up resources and focus on its core activities by outsourcing a few processes to a third party.

India’s outsourcing sector solves capacity challenges, improves service quality, and improves business environment efficiency. Initially, outsourcing to India was a cost-cutting measure. It’s no longer just about cost; it’s also about the competitive landscape, agility and innovation, and the availability of competent labour in India.

IT services revenue will rise by 1.7% in 2020, according to Gartner, due to a sustained change in demand toward digital, driven by cloud and automation-based solutions. Despite the pandemic, the market has grown at a steady pace.

Businesses will continue to demand innovation, agility, and operational flexibility as the IT industry grows steadily in the coming years.

IT Services that can be outsourced from India

Outsourcing companies flock to India for a variety of reasons. In comparison to other low-cost countries, it has the widest selection of English-speaking trained workers.

Almost half of the world’s 500 largest corporations are able to work in India because of more than 1,140 global in-house captive centers in India.

There has been a steady stream of advancements in the industry. The NASSCOM online platform, for example, aims to educate and upskill more than 2 million tech workers and those who are interested in the field.

There are more than 1000 Indian IT companies that have set up delivery centers in around 80 countries. Around 75% of the world’s digital talent is based here.

“Information technology” (IT Services)

In today’s business environment, technology and digital platforms are becoming increasingly important, and IT outsourcing can help businesses achieve a substantial competitive advantage.

Knowledge of specific domains and the correct technologies are necessary for IT services. Because of this, it is imperative that staff be properly trained, as well as the necessary infrastructure to support their efforts. This can be a time- and money-consuming operation.

Any industry’s essential IT support services include the following:

Development of software with assistance from the technical community

Development of Websites and Mobile Apps

In many cases, corporations chose India as an outsourcing destination because the Indian software sector has highly-skilled developers and the infrastructure necessary to support their needs.

The Indian software industry has specialized knowledge and skilled software developers for the job in addition to the software infrastructure.

Furthermore, there is no need to be concerned about the quality of the work because many Indian organizations have been providing these services for decades.

Almost 60 percent of Deloitte’s clients already outsource some or all of their work to India. Moreover, 22% of those who are not actively outsourcing in India are already preparing to do so in the near future.

Companies outsource to India for a variety of reasons, including the following:

1. The infrastructure

India has shown itself to be a leader in IT infrastructure with IT centers in places like Bangalore, Gurgaon, and Hyderabad. Many towns and cities in India have well-developed telecommunications and cellular networks, allowing for a smooth flow of communication.

India’s infrastructure is still underdeveloped. With that said, as compared to other countries, India provides superior facilities and more efficient ground-level operations that are more cost-effective.

2. Policies of the government

Because of the country’s tax and telecommunications laws, among other things, the country’s IT infrastructure and communications systems have improved significantly. A new law, the Information Technology Act, was passed by the Indian government, and it now recognizes electronic contracts, permits document filing electronically, and prohibits cybercrime.

In addition, the country has a robust network of IT/ITeS promotion bodies and organizations with unique tax incentives for the outsourcing and BPM industries in India. As a result of the COVID-19 outbreak, government agencies have made it simpler for BPO staff to work remotely by eliminating or reducing registration restrictions. BPO workers will benefit greatly from this, both now and in the future.

3. Large pool of highly-skilled workers

The IT and ITeS businesses in India have one of the fastest-growing pools of talent in the world. More than 10 million individuals are indirectly employed by the outsourcing service India marketplace in addition to the 4 million people who are directly employed by the marketplace.

Businesses in BFSI, healthcare, e-commerce, and technology can benefit from India’s IT and engineering talent pool, which is growing at a rate of 200,000 new graduates per year.

4. Most rapid time to market.

Because of the time difference between India and the rest of the world, outsourcing companies in India are the most efficient. Because of the 12-hour time difference between India and the United States, workers can complete their tasks more quickly, resulting in higher production and efficiency.

5. The ability to communicate in the English language

In terms of English proficiency, 2019 research found India to be the fifth-best Asian country. There are more English speakers in the country than in the United States.

Over the years, outsourcing businesses in India have been adapting to their internal and external capacities in order to provide best-in-class services.

India is viewed as a global destination for outsourcing IT services due to its skills, communication, technology, and deliverables, among other advantages.