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Gartner figures show BPO contracts on the rise with Asia Pacific suppliers in the lead

Karl Flinders

Business process outsourcing (BPO) contracts will continue to increase with suppliers in emerging economies in Asia/Pacific to the fore as multinational companies return to a period of growth.

According to the latest Gartner research, sales of business process outsourcing (BPO) from suppliers based in Asia/Pacific will increase 17.9% in 2011 compared to the global average of 6.3%. Western European BPO sales will increase above the global average at 8.9% in 2011, while North American BPO suppliers will see sales increase 3.8%.

Gartner says the combination of best-of-breed processes and technology, faster time-to-market and improved quality of service makes suppliers from emerging economies in Asia/Pacific attractive.

Most growth in the Asia/Pacific region will come from suppliers based in India, China and Australia, where BPO services for HR, finance and accounts, banking and financial services, billing services and supply management will be in high demand in 2015

Cathy Tornbohm, research vice-president at Gartner, said: "Emerging markets are faring far better and, generally, multinational companies continue to look to BPO as a means both to reduce costs and to buoy their business operations during the protracted return to a growth environment. We also see an increase in transaction volume, especially in payroll, recruiting, accounts payable, and customer data analytics and knowledge process outsourcing (KPO) activities."

Gartner said BPO services in continental Europe are held back by language requirements, labour laws and a lack of labour arbitrage benefits.

BPO and IT services are increasingly becoming available from a single source.

Capita recently bought contact centre business Ventura for £65m in a further sign of IT and BPO consolidation. The UK-based acquisition gave Capita private sector clients O2, Orange, British Gas, Tesco Bank and Google, as well as customers in the public sector such as the Department of Work & Pensions.

In April this year Indian BPO supplier Genpact acquired IT services firm Headstrong.

Peter Brudenal, lawyer at Lawrence Graham, said there could be a trend for large service providers attempting to become more like Accenture in building large IT and BPO services.


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