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Focus on Cost-Effective Business Operations to Create Opportunities for the Global Business Process-as-a-Service Market Through 2020, Reports Technavio
[June 29, 2016]

Focus on Cost-Effective Business Operations to Create Opportunities for the Global Business Process-as-a-Service Market Through 2020, Reports Technavio


Technavio analysts forecast the global business process-as-a-service (BPaas) market to grow at a CAGR of close to 12% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global BPaas market for 2016-2020. The report also lists human resource, e-commerce, payments, customer management, finance and accounting, and others as the six major segments based on services.

Technavio ICT analysts highlight the following three factors that are contributing to the growth of the global BPaas market:

  • Focus on cost-effective business operations
  • Growing demand for cloud services and standard operating processes
  • Rise in use of technology to drive business

Focus on cost-effective business operation

A growing number of global organizations are outsourcing back office operations, which otherwise require more infrastructure, capital investment, and human resources. Outsourcing these functions enable firms to cut costs and apply the lean model into their operations. SMEs with limited infrastructure outsource business processes to the cloud. These services are subscription-based and follow the pay-per-use model.

The cloud infrastructure used by organizations is becoming extremely complex due to the use of multiple application platforms and complex equipment. Hence, organizations need additional resources and money to manage these applications effectively.

According to Amit Sharma, a lead analyst at Technavio for ITO and BPO research, "Operational cost reduction and time savings are the most appealing traits of the global BPaaS market. By outsourcing the business processes in the cloud, organizations can focus more on their core business. This also increases the productivity of their IT department."

Growing demand for cloud services and standard operting processes



It is necessary to ensure that business processes comply with standard operating procedures. The basic requirement of any standard operating procedure is to understand the procedures and maintain the same standards across the units. BPaaS solution generates process documentation that helps organizations adhere to stringent standards. The ability of the business process solutions to document procedures and identify discrepancies is driving its adoption.

The demand for cloud services among business enterprises is rising, and this is enhanced by the presence of several cloud service providers in the market. The increase in demand also reduces the price of cloud services, creating more demand. It helps organizations reducing the overall cost of IT applications and services, which would otherwise be spent on purchasing their own equipment, software, and costly upgrades.


The less-complex interfaces and self-service provisions of cloud computing are helping many organizations with limited resources manage their cloud applications. Through the pay-per-use model of cloud computing, end-users are expected to pay only when the applications are used. Thus, the rising demand for cloud services is predicted to drive to the global BPaaS market during the forecast period.

Rise in use of technology to drive business

Many companies are trying to integrate their business and technology solutions to not just reduce costs but also to improve productivity and innovation. Neo-sourcing which is the integration of IT outsourcing and BPO, is an evolution of the BPO models offered by outsourcing companies. Neo-sourcing is a combined management of back office operations and technology, leading to process re-engineering, which will result in business transformation and optimization. Benefits of neo-sourcing include process optimization, cost reduction, reduced cycle time, access to the best global practices, and improved productivity. With the number of BPO deals dwindling, the integrated outsourcing strategy will help vendors remain competitive in the market.

With the evolution of cloud, enterprises are integrating their CRM tools and marketing to obtain consistent messages across all possible channels and focus on aligning customer service calls with marketing. The integration between the CRM and marketing channels is achieved by moving the contact center to the cloud. "It is expected that by 2019, chief marketing officers will adopt the cloud technology for marketing and move contact center completely to the cloud infrastructure," says Amit.

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About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

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