IT outsourcing is becoming increasingly popular and bringing fundamental changes to businesses around the world. According to Gartner’s report, global IT spending, which expects to reach $3.8 trillion in 2019, will continue to grow. At the same time, Statista estimates global outsourcing industry revenue at 92.5 trillion in 2019, with a sharp increase expected by 2021.
Outsourcing is shaping the global market, changing how companies think about development, and offering unimagined opportunities. Here are ten trends in software development outsourcing in the unprecedented era of 2021, so get ready for all the hype to benefit your business.
Trends in software development outsourcing.
1 The rise of narrowly focused software companies.
Opinions may divide, but some people prefer to work with outsourcing companies. Others say they enjoy the benefits of multi-vendor services.
But the fact is that more and more companies need a company specializing in a narrow range of services. One of the reasons for this trend is the rapid changes in technology. It is impossible to have an in-house team with all the necessary skills to keep up with the new technological innovations emerging every day.
Companies are looking for skilled external providers who can deliver the highest quality to them, and working with more than one provider is a no-brainer if you can get the results you want. However, when a leading outsourcing company provides full-cycle software development with a diverse team of skilled professionals, it also has the significant advantage of being a great vendor to build strong and transparent relationships.
2 Customers will demand enhanced experiences through AI and IoT.
Online shopping has long become a part of our everyday lives. Moreover, according to Forbes magazine, it has become the new norm with the outbreak of COVID-19, with even the 65+ category stating that they are more likely to shop online than offline. With the growing demand for online shopping, companies are investing more in improving the user experience (UX). Customers are 140% more likely to spend more if they have a positive experience.
Solutions with AI and IoT capabilities will improve e-commerce by providing a more personalized customer journey.
AI-driven chatbots are already replacing human interactions to provide customers with the guidance and advice they need.
Gartner reports that 85% of customers would order products and services without human intervention; 80% of customers prefer companies that provide a personalized customer experience to those that do not.
3 High demand for blockchain services
Global spending on blockchain expects to reach $16 billion a year by 2023, which has made it a primary focus of IT outsourcing. From intelligent contract design to instant microtransactions, distributed ledger technology has established itself as improving security, transparency, and innovative fundraising solutions for start-ups.
As the demand for competent and capable blockchain services grows, so does the need for well-trained professionals. Today, there is still a shortage of blockchain professionals.
Therefore, from financial institutions to private companies, many industries are looking for outsourcing companies with an experienced team of blockchain specialists.
4 The growing need for greater cybersecurity
Data has long been the most valuable asset. That’s not news. But because of this, protection has never been more critical.
As cybercrime increases, more companies will invest their money to become GDPR (General Data Protection Regulation) compliant. The requirement now is that all data must be well protected.
Especially when government agencies fall victim to cyber-attacks, whether it’s an IT company or a small family business with a website, owners turn to outsourced cybersecurity services to address security concerns, protect their business data and comply with GDPR standards.
5 Booming global cloud computing market
Another prediction from many sources, including Gartner reports, is that demand for cloud computing will only grow. Forecasts predict that global spending associated with the shift to the cloud will be close to $1 trillion.
As the amount of data that needs to be stored increases, companies turn to outsource to create efficient cloud platforms. The need for cloud outsourcing services will go hand in hand with the demand for security services. The number of public cloud storage platforms is already increasing.
6 The high-tech industry, healthcare, and telecoms are becoming highly digitized
Trends in outsourcing go hand in hand with trending technologies that impact specific industries.
Fintech, healthcare, and telecom, in particular, will have a strong demand for outsourcing services necessary for their digital transformation.
AI, blockchain, and peer-to-peer transactions will become the new norm in the fintech industry. Simultaneously, medical institutions, both public and private, will be looking for AI-enabled VR outsourcing services to expand their diagnostic horizons.
Not to mention the impact of the 5G network on the telecoms industry, opening the door to unprecedented mass IoT connectivity opportunities.
7 Expansion of the IT outsourcing center in Eastern and Central Europe.
While a few years ago the demand for outsourcing services was strongly influenced by the need to reduce costs, in 2021 companies will continue to focus on quality rather than lower prices.
This will lead to favorable conditions for outsourcing being explored in Eastern and Central Europe rather than China and India.
Ukraine, Poland, and Belarus are already becoming attractive centers for experienced offshore development teams to work together.
The development market in Eastern and Central Europe is expanding due to the high quality of services, well-trained teams, and still moderate prices.
8 The explosive growth of AR and BP markets.
By 2021, the AR market is expected to grow to US$133.78. In turn, the entry of smartphones into the global market is increasing the demand for AR and VR solutions.
The shopping experience is expected to be enhanced by AR technology. The recent launch of Pokemon Go is a prime example of the interactive nature that AR will bring. These technologies will continue to make inroads into the markets for tourism, e-learning, manufacturing, etc.
While the AR and VR market is still somewhat uncertain, companies are looking for outsourcing services to implement interactive elements and increase their revenue. Large companies such as Mercedes or Apple are already using these technologies.
9 The Hype around robotic process automation
Lower operational costs, improved work coordination, and fewer manual errors are just some of the benefits of RPA technology that is trending.
Business automation is the No. 1 priority in the ever-evolving digital environment. Logistics management, payment processing, and a more personalized experience will all benefit from RPA technology.
Virtual assistants and bots are just the tips of the iceberg in terms of shifting the burden from menial and repetitive tasks to humans. This is why IT outsourcing companies are investing heavily in business automation and advanced analytics.
10 Increased interest in progressive web applications
With the increased need for a better user experience, the need for PWAs is also growing. They are designed to create such an application on websites.
The first wave was Google facilitating a website without a mobile version. The second wave is the customers themselves, who will not welcome a website with a negative UX. Therefore, companies will look for outsourcing companies to use PWAs and meet the growing demands of their customers.
Summary: Why is the trend of IT outsourcing growing so fast?
Today, we are faced with a rapidly growing technology environment. Companies that do not want to fall behind are already investing their time and money in digital transformation.
However, there are some challenges. One is the speed of innovation. While even large companies with well-resourced teams can’t keep up and are in desperate need of outsourcing specialists, even smaller companies can’t manage digital transformation without a supportive outsourcing team.
The high demand for outsourcing support will make such collaboration more transparent and interpersonal. In addition, companies will focus on costs rather than lower costs.
For this reason, collaboration with multiple providers, each specializing in specific services, will be a common practice.
In summary, to keep up with the times and in line with the quality standards that 2021 will dictate, companies will look for outsourcing partners to share risks and create better value together you can contact top software outsourcing companies in India for reliability and on-time delivery projects.