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Use of Business Analytics to Optimize Operational Costs and Improve Business Efficiency Will Boost the Global ITO and BPO Market Through 2020, Reports Technavio
[May 26, 2016]

Use of Business Analytics to Optimize Operational Costs and Improve Business Efficiency Will Boost the Global ITO and BPO Market Through 2020, Reports Technavio


Technavio research analysts are forecasting positive growth for many segments of the global information technology outsourcing (ITO) and business process outsourcing (BPO) market over the next four years as several markets including BPO business analytics, human resource outsourcing, and structured finance, will witness an increase in revenues.

According to Technavio, the need to achieve operational efficiency and regulatory compliance acts as a key driver for the growth of the global BPO business analytics market. Business analytics are used for strategic decision making, enabling organizations to understand their customers, optimize operational cost, and improve business efficiency and competitiveness. Also, enterprises in the BFSI and healthcare sector need to comply with regulatory norms such as Basel III and Solvency II. Business analytics outsourcing helps enterprises address such compliance requirements by increasing their transparency. With a market share of over 25%, the BFSI end-user segment led the global BPO business analytics market during 2015.

"The global BPO business analytics market is segmented into three key regions, including the Americas, APAC, and EMEA. As of 2015, the Americas were the market leader with more than 50% market share. North America is one of the key contributors due to the increased demand for business analytics outsourcing from sectors such as public, BFSI, and healthcare," says Amit Sharma, a lead analyst at Technavio for research on ICT.

Another segment of the ITO and BPO market that is exhibiting immense growth is the global structured finace market. The third party due diligence service is the primary growth driver for this market. Portfolio risk solutions are also expected to aid the market growth during the forecast period by providing real-time pricing and capital management of multi assets portfolio. Technavio anticipates the market to grow rapidly at a rate of 16% during the period 2016-2020.



Based on product, the global structured finance market is segmented into the following: asset-backed securities (ABS (News - Alert)), collateralized debt obligations (CDO), and mortgage-backed securities (MBS). ABS products improve the efficiency of the resource allocation such that there are more liquid securities and better risk sharing. This led to their dominance of the market during 2015 with a market share of approximately 37%.

View Technavio's entire ITO and BPO market report library


Technavio also considers the global human resource outsourcing (HRO) market as one of the fastest-growing segment. The need for cost reduction in business processes is expected to aid this market to post a remarkable CAGR of over 12% during the period 2016-2020. Organizations are increasingly adopting HRO services to consolidate their market position, enhance their operational efficiency, and maintain an edge over their competitors. For instance, RPO, a segment of HRO, is a cost-effective solution for organizations seeking to create intense competition in the marketplace.

Currently, organizations are adopting social media to source, advertise job vacancies, and generate leads for the best candidate. Payroll outsourcing firms worldwide are tapping social networking sites and the Internet to identify and screen potential talent and experienced people. This trend of social media recruitment is anticipated to gain traction in the coming years.

Some of the key vendors for ITO and BPO include Accenture, Capgemini, and Genpact (News - Alert) for BPO business analytics, Bank of America Merrill Lynch, Barclays, and Citigroup for structured finance, and ADP, Aon Hewitt, and IBM (News - Alert) for human resource outsourcing.

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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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