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BPO is an abbreviation for business process outsourcing.
It is contracting another firm to do a procedure that the company needs to function. To put it simply, when a company hires a third party to manage its non-core business operations, they engage in business outsourcing. Here are the latest BPO statistics, trends, and facts:
General BPO Statistics
- The worldwide business process outsourcing market was estimated at $245.9 billion in 2021 and is predicted to increase at a 9.1% compound annual growth rate (CAGR) from 2022 to 2030. (Grandviewresearch, 2021)
- The military industry accounts – the most significant outsourced transactions — earned $100 billion in income. (City University of New York, 2009)
- 40% of help desk employment in the banking business is outsourced. (Credit Donkey, 2015)
- Before the pandemic, the worldwide outsourcing market was worth $92.5 billion. (Statista, 2019)
- Every year, around 300,000 jobs are outsourced from the United States. (Zippia, 2022)
- To improve outsourcing, more than 93% of firms are contemplating or have already implemented the use of cloud services. (Deloitte, 2018)
- Data security is a key issue for 68% of outsourced organizations contemplating cloud computing. (Digitalguardian, 2020)
- The global financial services outsourcing market is valued at more than $130 billion. (Fortunly, 2021)
- 29% of businesses with fewer than 50 employees outsource, compared to 66% with 50 or more employees. (Fortunly, 2021)
- 24% of small businesses outsource to improve efficiency. (Fortunly, 2021)
- The most commonly outsourced jobs in small businesses are accounting and IT services. (Clutch, 2021)
- 52% of executives say they outsource business functions. (Deloitte, 2022)
- 76% indicate that they outsource IT functions. (Deloitte, 2022)
- 89% of companies develop or deploy their cloud services via service providers. (Deloitte, 2022)
- 96% of executives report using third-party data and analytics providers. (Deloitte, 2022)
- The top qualities that companies value in a service provider are transparency (54%), trustworthiness (41%), understanding of the business (36%), proven results (36%), and clear and frequent communication (33%). (Deloitte, 2022)
- In 2022, the average spending of SMBs on outsourcing was $198,550. (Clutch, 2023)
- 52% of small companies regularly use a firm or an agency for outsourcing. 45% use freelancers, and 45% use consultants. (Clutch, 2023)
- The three most important factors for small organizations when choosing an outsourcing provider are price, industry experience, and team diversity. (Clutch, 2023)
- In 2023, the business process outsourcing market is anticipated to generate US$0.35 trillion in revenue. (Statista, 2023)
- Market volume is projected to reach US$0.45 trillion by 2027, with revenue predicted to expand at a 6.48% annual rate. (Statista, 2023)
- In the business process outsourcing market, the average spend per employee is expected to reach $100.50 in 2023. (Statista, 2023)
- In terms of worldwide comparison, the United States is expected to produce the most significant revenue of $129.70 billion in 2023. (Statista, 2023)
Why Do Companies Outsource Processes?
- Outsourcing procedures help organizations focus on key processes, according to 57% of businesses. (Digital Learning, 2019)
- 78% of firms have a favorable connection with their outsourcing partners. (Deloitte, 2021)
- While cutting costs is a primary reason why 57% of companies outsource processes, access to new capabilities (51% of organizations) and keeping up business strategy and operating model shifts (49%) are vital drivers of traditional outsourcing. (Deloitte, 2022)
- The primary drivers of managed services are the increasing pace of technology and digital transformation (62%), gaining access to new capabilities (56%), and the rising and more complex cybersecurity threats (54%). (Deloitte, 2022)
- 49% of executives say they opt for operating services to gain access to new capabilities, 46% implement them because of business strategy and operating model shifts, and 45% believe they are vital to changing regulatory requirements. (Deloitte, 2022)
- The main reason why small businesses outsource tasks is to reduce expenses and bring industry experience onto the team. (Clutch, 2023)
What are the Outsourced Business Processes?
- 37% of businesses outsource their accounting functions. (Clutch, 2019)
- IT services are the largest outsourced process, accounting for 37% of all outsourced operations. (Clutch, 2019)
- Following accounting and IT services, 34% of firms outsource Digital Marketing tasks. (Clutch, 2019)
- Lead creation and cold calling are two more operations that are frequently outsourced. (Sopro, 2021)
- To save money, 28% of businesses will outsource company development. (Deloitte, 2020)
- The five most outsourced business processes are legal functions (64%), tax (61%), HR (57%), finance (51%), and manufacturing and supply chain procurement (48%). (Deloitte, 2022)
- IT functions are even more outsourced, with companies using external providers for cybersecurity (81%), app/software development (79%), IT infrastructure services (77%), next-gen tech (78%), data analytics (75%), app support (73%), and helpdesk and user computing (68%). (Deloitte, 2022)
- In 2023, small businesses will look for new outsourcing providers in marketing (27%), IT services (22%), and design (21%). (Clutch, 2023)
Outsourcing Statistics that Show the Impact of BPOs
- When attempting to move to cloud infrastructure, 68% of businesses encounter problems with BPOs. (Customerthink, 2020)
- 35% of firms are always concerned about the data exchanged with outsourcing agencies. (Customerthink, 2020)
- Despite their reservations, 44% of chief intelligence officers are eager to interact and exchange data with outsourcing firms. (Customerthink, 2020)
- The negative impact on company culture is a top third-party selection worry for 22% of executives. (Deloitte, 2022)
Concerns About Outsourcing
- When attempting to move to cloud infrastructure, 68% of businesses encounter problems with BPOs. (Customerthink, 2020)
- 35% of firms are always concerned about the data exchanged with outsourcing agencies. (Customerthink, 2020)
- Despite their reservations, 44% of chief intelligence officers are eager to interact and exchange data with outsourcing firms. (Customerthink, 2020)
- The negative impact on company culture is a top third-party selection worry for 22% of executives. (Deloitte, 2022)
Statistics Showing a Bright Future for BPOs
- 65% of organizations that use BPOs for application hosting are eager to increase their outsourcing investment. (Customerthink, 2020)
- In India alone, the information technology BPO business generated $154 billion in revenue in 2017-18. (Brandongaille, 2020)
- 57% of companies use business process outsourcing to concentrate on core issues, operations, and activities (Statista, 2021).
- Approximately 54% of businesses employ at least one third-party support staff to communicate with consumers (Fortunly, 2021).
- Currently, 74% of firms use the business process outsourcing industry for their information technology needs. (Statista, 2021)
- 65% of firms that utilize BPO for application hosting expect to raise their spending in the coming year. (Intelligent Bee, 2022)
- 67% of companies will increase their budget for operating services, 57% will invest more in managed services, and 32% plan to spend more on traditional outsourcing. (Deloitte, 2022)
- 83% of small businesses plan to keep or increase their BPO budget in 2023. (Clutch, 2023)
Human Resources & Customer Service
- Today, more than 40% of banking and financial institution support desk employment is outsourced. (Deloitte, 2021)
- 24% of businesses say that outsourcing HR and customer service allows them to focus on core operations. (Fortunly, 2021)
- Due to today’s business requirements, organizations spend significant time and money on accounting operations. As a result, accounting is the second most outsourced emphasis area, with 37% of organizations outsourcing their accounting procedures to BPO. (Clutch, 2019)
Conclusion
These BPO statistics show that businesses see outsourcing as more efficient than employing and paying a full team. In some cases, a more specialized organization can perform a business task better than the company can handle it in-house.
Written by shorlister editorial team
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