Despite the last year’s predictions that the European Union is likely to catch up with the United States by the total IT outsourcing (ITO) contracts value in 2011, the factual state of affairs demonstrates a substantial decline in the European outsourcing transaction volumes (both in ITO and business process outsourcing (BPO)). The last Global Services Industry Quarterly Report by Everest Group, one of the world’s leading outsourcing consultancies, determines this decline to make 7% from Q2 2011. On the other hand, IT Sourcing Europe’s country-specific surveys show that the number of the low-value and less asset-intensive outsourced IT/development projects has increased in Europe in 2011, compared to 2010.

The Pan-European IT Outsourcing Intelligence Report 2011 presents the summary of the All-European IT Outsourcing and In-House Software Development research conducted between February and December 2011. In the course of the research the following European countries were surveyed (in alphabetical order): Austria, Cyprus, Denmark, Finland, Malta, Norway, Sweden, Switzerland, Netherlands and United Kingdom.

The key goal of the Report is to identify the differences and similarities in the ways how companies from the above listed countries behave in terms of:

• Overall adoption of IT / software development outsourcing services
• Choosing their IT outsourcing destinations
• Choosing their IT outsourcing service providers
• Responding to the most critical outsourcing challenges
• Managing their vendor relationships
• Cost saving
• Planning their future adoption of IT / software development outsourcing services

All countries to be analyzed in the present Report have been divided into three groups: 1) Nordic Region (Denmark, Finland, Norway and Sweden), 2) DACH, or German speaking region (Germany, Austria and Switzerland) and 3) United Kingdom, Netherlands, Malta and Cyprus.

Within each group the countries will be compared and contrasted in terms of:

• Top three industries that most actively adopt outsourced IT/software development
• Top three IT outsourcing drivers
• Top three IT outsourcing geographies
• Top three IT outsourcing challenges
• Top three IT outsourcing problem solving practices
• Top three IT outsourcing partner search tactics
• Most outsourced areas of expertise
• Most popular IT outsourcing business / engagement models
• Top three IT outsourcing impressions
• Top three reasons keeping companies away from IT outsourcing
• Future IT outsourcing factors and drivers

The current economic uncertainty generally leads to the transformation of the entire ITO landscape in Western and Northern Europe. All-European IT outsourcing research identifying the following distinct shifts:

• From single-supplier megadeals to small multi-supplier contracts
• From ITO buyers’ reluctance to willingness to change their service providers who fail to meet their business goals and project milestones
• From dedicated development center and project-based models to more innovative business / engagement models able to provide maximum managerial control of the outsourced projects and transparent pricing
• From short-term cost saving goals to longer-term IT management strategic partnerships and cross-border knowledge exchange
• From offshoring to nearshoring