Companies Choose to Outsource More This Year
NEW YORK – Half of major U.S. enterprises intend to outsource their application development and maintenance this year rather than hire more employees to do the work inhouse, a survey from KPMG LLP and Hfs Research finds. Of the half that intend to outsource, 40% plan to increase outsourcing in the area of finance and accounting.
Client expectations of outsourcing are becoming more value-focused, with information technology, finance and accounting administrative processes dominating, the survey, "State of the Outsourcing Industry 2013,” found.
Additional survey findings:
Core areas of strategic focus when companies outsource include accessing better talent (70%), gaining access to better technology (62%) and improving analytical capabilities (62%).
Mid-market enterprises ($1 billion to $5 billion in revenues) are much more motivated by strategic needs than high-end enterprises (more than $5 billion in revenues).
Of outsourcing customers, nearly 88% are satisfied with cost-reduction and standard delivery from service providers, but they indicate that service providers are falling short in strategic areas, such as improving analytical capabilities, access to talent and achieving innovation.
Outsourcing adoption is still formative for business processes, with only 23% using outsourcing as the predominant model for handling accounts payable, 19% handling purchasing and accounts receivables, and 11% for recruiting and staffing.
Published by The Business Journal, Youngstown, Ohio.
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