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Outsourcing was initially accepted as a business tactic in the late 1980s and came to be an essential component of business development during the 1990s. Outsourcing represents a widespread business practice of hiring a third-party team or company to perform services traditionally executed in-house. Companies usually undertook this practice as a cost-cutting action. It can include an extended range of positions and functions, from customer support to software development, design, or HR services. Even though companies primarily used outsourcing to decrease overall labor costs, including salaries, insurance, tools and supplies, and technology, the game has changed. New outsourcing trends have emerged, and the focus has moved from budget-friendly aspects to other significant fields and practices. Outsourcing trends for 2021 seem promising, and this entire industry is on the right path.
Businesses choose to outsource for various reasons. Outsourcing, as an increasingly popular practice, has several advantages.
For example, the principal benefits of outsourcing often cover:
New outsourcing trends, practices, and methods are yet to come.
The 1980s era brought more than 25 cents candy bars, post-it notes, and royal weddings. Newly developed business practices accompanied big hair, funky music, and recognizable fashion. These were the years outsourcing was born.
The industrial revolution started to lead toward outsourcing as we know it. In the 80s, companies turned to the outsourcing of accounting and payroll. And before we could even press play to listen to Another One Bites the Dust, the outsourcing has evolved.
Nowadays, we have an entire pool of possibilities and reasons to consider and incorporate this practice. Call centers and similar customer care services, software development, and human resources only represent some of the commonly outsourced positions and job functions.
In 2020 and 2021, we can witness a whole new world of outsourcing trends.
Nearly two years ago, the global market of outsourcing was getting close to 100 billion worth. The outsourcing industry has massive gains and is continually growing. In 2017, the tech talent outsourcing in India alone had reached a revenue of $154 billion. The US market has reached even higher amounts. And the trend suggests that these figures are going up.
In 2021, the outsourcing industry will stretch to a new length and gain even more attention and popularity worldwide. Having in mind the global changes 2020 has brought, outsourcing trends for 2021 will imply further improvements, more tech advancements, more flexibility, and globalization.
Remote work became the new normal, and even once the pandemic is over, it is safe to assume that the majority of businesses will remain in favor of this employment type. In addition to it, outsourcing and its finance-related perks will mark the business practices and strategies in 2021. The world economy will feel the consequences of COVID-19 in the year to come, which will cause organizations to question the safest and the most cost-effective ways to grow, scale, and progress.
There are different techniques to make one’s mark in the present day’s business scene and gain a competitive advantage. Companies aim to breeze through the market and get ahead of the game by using outsourcing partnerships. Choosing the right outsourcing company can have a tremendously positive impact from several angles and viewpoints. The new outsourcing trends are contributing to the enhancements in business practices and improved outcomes. Some of the current tendencies and inclinations will stay relevant in the year 2021.
The major shift that has transformed the way organizations understand outsourcing is the switch from delegating small tasks toward outsourcing more core functions. Besides recognizing the numerous financial benefits of outsourcing, businesses have started to assign more essential tasks and areas to reliable third-party partners. By outsourcing high-end processes, companies achieve more. They obtain new knowledge and better results quickly.
In 2021, focusing on processes and people will be far more significant than the price. Price-driven partnerships are a thing of the past. Probably the most important outsourcing trend for 2021 is staying in touch with employees’ and customers’ real necessities. Outsourcing companies will alter their approach and stir their work by emphasizing the processes and the people participating.
One of the most frequently mentioned disadvantages of outsourcing was focusing on quantity and being strictly profit-oriented. Now, results and quality play a more valuable role. Concentrating on high-standards and optimal results is the trend that will label outsourcing as favorable and efficient in 2021, too.
In 2021, customers will become more demanding. In other words, companies continuously come up with new tactics and solutions to provide excellent customer care. However, this vital segment will require even more attention and dedication in the following years. With customer expectations rising, businesses must invest in their customer support teams. Firstly, happy customers are likely to recommend your brand and ease customer acquisition. They boost your visibility and reliability by leaving positive reviews and testimonials.
Secondly, content customers who had a superb experience when interacting with your representatives are more loyal. Thirdly, outstanding customer experience increases Customer Lifetime Value and leads to significant long-term gains.
Most importantly, dedicating your customer support service to a reliable company is one of the leading 2021 outsourcing trends.
The regions and countries organizations typically picked to find suitable outsourcing business partners are changing. Nowadays, it appears that Europe is presenting a more appealing talent pool than ever. India and Latin America, the primarily favored areas and outsourcing paradises, are slowly falling from their thrones and making room for fresh talent. The best countries to outsource to and more successful business partners to meet are now located in the Old Continent.
The European market is booming, diverse, and prosperous. Outsourcing to a European country brings onboard talent with a strong work ethic and culture. Highly proficient and educated experts, excellent English skills, and a fantastic quality-to-price rate make Europe the prime location for creating business relations.
Outsourcing used to represent a privilege owned by enterprises and well-established brands. Now, there’s a new wave. Surveys have shown that in 2019. there were more than 50% of small businesses that planned to outsource. Today, more than ever, small businesses and startups are exploring and confirming the many advantages of outsourcing. More and more early-stage companies consider collaborating with a third-party team to prevail over operational deficiencies and enhance their time to market. Starting from scratch usually entails having to be extra cautious regarding many matters. New business owners have to think of the budget continuously.
They are focused on structuring and conducting hiring processes, defining and strengthening the employer brand, keeping the employees happy, and finding clients or customers. All at once. Concentrating on all these responsibilities can convert into an impediment when delivering a high-quality product or outstanding service. In-house teams wouldn’t be able to achieve it all without some external assistance and additional competence. These precise reasons helped small businesses and startups spot the gains of partnering with a credible and skilled outsourcing company.
In 2020, there are fewer predetermined contracts, and the usage of these fixed agreements will keep dropping. In addition, custom outsourcing agreements diminish cost pressures and restrictions encountered by numerous businesses that choose to outsource. Custom contracts allow both parties to achieve a reciprocal arrangement. It helps to communicate and negotiate the pricing, scope of work, exact duties and obligations, and delivery. It promotes flexibility and mutual trust and reduces misunderstandings, overpaying, and displeasing outcomes. Customized contracts undoubtedly represent a prevalent outsourcing trend for 2021.
What happens in 2020 will partially not stay in 2020. And by that, we mean the good stuff.
Beneficial, innovative trends will move along with us into 2021. The future of outsourcing will be in good hands due to the shifts and movements we have witnessed over the past few years. And over the past few months, even more so. Outsourcing core business services will change the face of many organizations and will lead to incredibly positive results. The tech advancements and automation will ease all processes and better the communication between in-house staff and their third-party allies. New digital tools and AI solutions will contribute to more rapid development, better services, and heightened productivity.
In conclusion, if you choose to outsource in 2021, make sure you pick the best partner.