On The Rise; Outsourcing Trends for the Year 2020
The digital era has come out of its dawn and is steadily working its way towards its brightest peak, remodeling the world in a pace that humanity can barely keep up with. And as 2019 draws to a momentous close, the stage prepares to accommodate the incoming year and its attendant changes.
In anticipation of these events, here is a list of events and trends that would potentially influence and sculpt the landscape of the outsourcing industry in the year 2020.
The Sino-American Trade War
The Sino-American Trade War, or better known as the Chinese-American Trade War, is the ongoing heated battle between two of the world’s largest and most powerful economies. It infamously originated from current United States President Donald Trump’s imposition of tariffs on imported Chinese goods, which of course led to China's retaliation by imposing its own tariffs on imported US products. After a long exchange of threats and even more tariffs and trade barriers, both camps appear to finally be reaching a less hostile common ground – although perfect amicability still seems off the table for now.
The United States is one of the biggest consumers of outsourced products and services. On the other hand, the People’s Republic of China according to Business Insider is the world’s top outsourcing country with an outsourcing market that grows by 30 percent each year. It’s not such a leap of faith to say that United States probably outsources a lot of its processes to China – but with the existing conflict between the two countries, it’s more than a distinct possibility that US based corporations are likely to look for other popular outsourcing destinations like the Philippines and India to avoid being hit as the economic battle rages on.
Customer Service Outsourcing
In this digital age, everyone who has an opinion to share have enumerable ways to express themselves. This is a double edged sword for businesses. As the White House Office of Consumer Affairs states, a single dissatisfied customer will likely tell 9-15 people about their disappointing experience – magnified by the power of the social media, this single dissatisfied customer might just prove detrimental to the company’s reputation and revenue.
Even now, brands like Ford Motor Company, Cisco, American Express, JP Morgan Chase and others utilize this power to their own advantage, and are relying on offshore BPO companies to handle their customer relations. With these names fanning the understandable hype of focusing on client satisfaction, we anticipate that there would be a definite rise in the number of businesses who outsource their customer service in the coming year.
Social Media Management Outsourcing
As of 2019, the social media platform Facebook alone amassed a total of 2.45 billion of monthly active users. This equates to 31.4 percent of the world’s total population, which is estimated to be currently at 7.8 billion. As the number of people who have access to the internet and the many different social media platforms rise, businesses and corporations hasten to establish a formidable social media presence. Small and mid-size enterprises, however, often cannot afford to hire a full-time on-site employee for the sake of social media management alone. For these companies, outsourcing is an alternative that would allow them to reap the full benefits of being on social media without having to break the bank.
Staff Acquisition and Recruitment Process Outsourcing
As outsourcing is predicted to overtake other industries in the very near future, more and more processes are also expected to be widely outsourced. Recruitment Process Outsourcing, or RPO, is no exception. RPO is simply the act of entrusting the hiring process of a company to a third party. The company usually provides their own candidate qualifications, requirements, and a highly specified screening process. For many businesses, but especially for startups and SMEs, outsourcing is a solution that allows them to nitpick their potential employees to their hearts’ content without having to spend too much on unnecessary expenses. This is why we expect to see RPO outsourcing to become more mainstream by next year.
Healthcare Finance and Administrative Outsourcing
The Center for American Progress projects that by the end of 2019, U.S. payers and providers would have spent almost $500 billion on healthcare-related billing and administrative costs alone. As inflation hits the economy, and as healthcare regulations turn more rigid, this amount is expected to hike up even further in the near future. To cut back on expenses, many healthcare organizations have turned to outsourcing in the past years. Even more are anticipated to join their ranks -- according to a survey by Healthcare Finance News, up to 98 percent of hospital leaders are deciding whether to offload their day-to-day non-core processes to third party outsourcing providers in the attempt to reduce operational costs.
Due to a number of factors such as geopolitical conflicts, emerging economies, new innovations and rising technologies, the world is constantly on the cusp of change.
Tech giants are continually looking for ways to establish themselves as modern pioneers. Billion-dollar industries are perpetually devising strategies to gain more customers and increase revenues.
Amidst all this, we at Big Outsource believe that there is a middle ground that would allow even SMEs to succeed. We also believe that information is power – which is why we think it’s essential to look at the past months to be able to at least partly anticipate the changes that might occur in the future. Because ultimately, we believe that one of the most vital keys to success is realizing the power of making informed decisions.
