Tholons Announces Top 10 Trends for Global Outsourcing in 2009
NEW YORK-LONDON-BANGALORE-MANILA (MMD Newswire) January 5, 2009 -- THOLONS, an Advisory, Investments and Research Firm for IT/BPO/KPO Services Globalization, today announced trends for 2009.
The ripple of the global economic downturn continues to impact the foundation of the outsourcing industry, both near and long-term. Service providers are experiencing impact of sluggish growth, decreased margins and employee downsizing. Service buyers are reducing IT budget allocations but still under tremendous pressure to reduce cost and survive.
Despite this lingering cloud of uncertainty, Tholons maintains that the long term demand for Outsourcing remains intact. Decreasing margins will push providers to better utilize existing resources, leverage operational levers, implement new technologies efficiently to differentiate themselves and improve service delivery processes. Clients, with reduced IT budgets will be more selective – demanding stringent SLAs, greater contractual flexibility and output/result based payments.
According to Avinash Vashistha, CEO, Tholons, “Service buyers will need to re-assess their outsourcing strategies and implement a better mix of multi-sourcing, nearshore and offshore models, while service providers will look to tap growing domestic markets (such as China, India, Argentina, Brazil and even US) as a means to hedge against the volatility of existing offshore contracts.”
These shifts will significantly induce a high degree of consolidation - smaller and less efficient providers may face difficulties in tapping new revenue streams and will be prone to acquisition or outright dissolution. Paul Santos, Managing Director, Tholons Capital says, “It’s an opportune time for the larger players to continue their string of strategic, niche acquisitions. In an increasingly competitive market, and improbable economic state, the mantra of only the strong will survive has never been more relevant.”
Tholons predicts the following Top 10 trends that will shape Global Outsourcing in 2009:
1. The market downturn will impact revenues during the first 2-3 quarters
2. Focus on domestic market to increase
3. Global economic downturn will lead to increased outsourcing in Healthcare, Education, Retail, Telecom and Legal Process Outsourcing (LPO)
4. Governments to take special initiatives in promoting destinations
5. Clients will increase geographic diversity in their service delivery locations
6. Pricing pressures will result in reduced rates and new measures to achieve cost savings and higher productivity
7. Consolidation imminent for small players - focus away from large deals
8. Outsourcing revival by 2009 end - driven by small to mid sized (SME) clients
9. Strong focus on innovation, R&D and technology adoption will be key differentiators for providers.
10. Sourcing deal sizes will increase for large clients
A copy of this report is available at: http://www.tholons.com/Trends_2009.pdf
About Tholons
Tholons is a Services Globalization and Investment Advisory firm that combines "Best of Breed" consulting experience with deep execution expertise and investment insights to deliver truly effective services to its clients. Tholons offers a detailed understanding of business processes and combines it with practical hands-on expertise in executing the strategy. Tholons draws upon the considerable experience of a hand-picked team, which has successfully formulated and executed globalization strategies to unlock value for Global Fortune 1000 companies. Service providers leverage Tholons expertise to optimize their global delivery model. Tholons advisors engage with government bodies to build compelling strategies for making countries attractive destination for outsourcing.
For more details about Tholons' Services Globalization and Investment Advisory capabilities, please visit our website at: www.tholons.com and www.tholonscapital.com
You may also contact us at:
US: Manuel Ravago
Email: manuel@tholons.com
Phone: +1 650 393 4001
UK: David Hoare
Email: david@tholons.com
Phone: +44 1494 675241
India: Neeraj Huddar
Email: neeraj@tholons.com
Phone: +91 963 201 1099
Philippines: Jo-An Darlene Chua
Email: joan@tholons.com
Phone: +63 917 527 2198
Singapore: Paul Santos
Email: paul@tholons.com
Phone: +65 9101 0589
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