Offshore Futures Report
Preparing for Global Sourcing
Intellect's Outsourcing and Offshore Group has launched its 'Offshore Futures Report', an insightful document highlighting the future trends within the offshoring industry. The paper was authored by Paul Morrison, Director, Alsbridge plc, and was edited by Hilary Robertson, BPO Strategy Director, Steria.
The 'Intellect Offshore Futures Report' is the most detailed assessment to date of the direction of global sourcing. Based on a survey of nearly 100 offshoring practitioners, users and analysts, the report identifies the seven most important offshore trends that will impact businesses over the next five years. Together they underline the increasing maturity and complexity of offshoring, in areas such as IT, finance and HR - and the urgent need for businesses to develop more consistent and coordinated strategies for tapping into global resource pools. In addition the report confirms that offshore business practices are well placed to maintain momentum or even accelerate during an economic downturn. At a time of pressure on operating costs, offshoring remains a vital tool for cost reduction and efficiency.
Offshore Futures Report - Preparing for global sourcing 
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The seven key themes identified in the report are:
- Expanding scope: Offshoring cannot be pigeonholed. In particular it will become increasingly common in higher value, middle market and European business contexts.
- Supplier Consolidation: 87% of respondents indicated that accelerating offshore supplier consolidation would have an impact on UK businesses.
- New Pricing Models: Offshoring will increasingly move away from traditional 'bodies and boxes' approaches to deal pricing. 84% of respondents thought that contracting for business outcomes would be a major trend in the future.
- Componentisation & standardisation: Technology trends such as 'software as a service' will reduce the complexity of global sourcing.
- Multi-location sourcing: 73% of respondents indicated that India will face increased competition as a hub for low-cost offshore sourcing, in particular from China. At the same time the UK and Europe will retain a competitive edge. 89% of respondents highlight 'onshore excellence' as a key trend, in which the UK will continue to be competitive in many activities that could theoretically be offshored to cheaper locations
- The need for expertise: The growing complexity of juggling multiple offshore activities, locations and suppliers will be the single most important offshore trend in the next five years. To handle this, businesses will increasingly look to ramp up their in-house offshore expertise, as well as turning to external advisers.
- End of the offshore backlash - for most: An acceleration in public sector offshoring was seen as one of the least likely scenarios (only 48% of respondents saw this as a key trend). As a result, public sector offshoring will continue to lag far behind the private sector. Nevertheless, only 47% of respondents thought that major economic downturn would result in a return to the politically heated offshore of recent years.
For more information contact:
Paul Morrison
Director
Alsbridge plc
Mobile: +44 7747 865 955
Tel: +44 2072 420 666
Email: paul.morrison@alsbridge.eu
The Offshore Futures Project was produced in conjunction with the Outsourcing and Offshore Group at Intellect - the trade association for the UK technology industry. Intellect provides a collective voice for its members and drives connections with government and business to create a commercial environment in which they can thrive. Intellect represents over 800 companies ranging from SMEs to multinationals. As the hub for this community, Intellect is able to draw upon a wealth of experience and expertise to ensure that its members are best placed to tackle challenges now and in the future.
For more information please contact
Ben Andersen-Tuffnell
(ben.andersen-tuffnell@intellectuk.org).
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