Today’s technology is evolving rapidly, enabling faster advancement, which accelerates the rate of change. In addition to technological trends and emerging technologies, a lot more has changed this year as a result of COVID-19 outbreak, making IT professionals realize their role will not remain the same in the contactless world of tomorrow. IT professionals in 2023-24 will be constantly learning, unlearning, and relearning (out of necessity if not desire). 

As natural language processing and machine learning advance, artificial intelligence will become more prevalent in 2023. With artificial intelligence, we can better understand each other and perform more complex tasks. We are expected to see a revolution in the way we live and work with 5G. 

How does this affect you? Keeping up with the latest technology trends and emerging technologies is essential. In addition, it means keeping an eye on the future so you can learn how to secure a safe job tomorrow and how to get there. Global IT workers are sitting back, working from home due to the worldwide pandemic. These are the top 16 emerging outsourcing trends you should pay attention to in 2023. 

1. Computing Power 

Almost every device and appliance in the digital age is powered by computing power. It’s here to stay, since data science experts predict that the computing infrastructure we are building now will only improve over time. Meanwhile, we already have 5G; get ready for the 6G era with more power in our hands and devices all around us. Moreover, computing power is generating more tech jobs in the industry but candidates would need specialized qualifications to qualify. Every country will have the highest percentage of employment in this field, from data science to robotics and IT management. The more computing power our devices need, the more technicians, IT teams, relationship managers, and customer service professionals will be needed.

2. Smarter Devices 

Our world has become smarter and smoother thanks to artificial intelligence. Rather than just simulating humans, it goes the extra mile to simplify our lives. As data scientists work on AI home robots, appliances, work devices, wearables, and so much more, these smarter devices are here to stay in 2023 and beyond. Most jobs require smart software applications to make our work lives easier. As more companies transform into digital spaces, smarter devices are another requirement and demand in the IT industry. Nowadays, almost every higher-level job requires a good understanding of IT and automation. 

3. Datafication 

Datafication is the process of transforming everything in our lives into devices or software powered by data. It is the transformation of human chores and tasks into data-driven technologies. Whether it’s smartphones, industrial machinery, office applications, or AI-powered appliances, data is here to stay for a long time to come! As a result, it has become an in-demand specialization in our economy to keep our data safe and secure.  

With datafication, IT professionals, data scientists, engineers, technicians, managers, and so much more are needed. A certification in data-related specializations can be done by anyone with a sound knowledge of technology to find a job in this field. There are so many successful data leaders emerging from smaller cities and developing countries like India, and data jobs are more about skills than big-level qualifications. 

4. Machine learning and artificial intelligence (AI)

In spite of its notable effects on how we live, work, and play, artificial intelligence, or AI, continues to be one of the new technology trends in the past decade. Among the many applications of AI, there are image and speech recognition, navigation apps, smartphone personal assistants, ride-sharing apps, etc. 

In addition, AI will be used to analyze interactions in order to determine underlying connections and insights, to help authorities make better decisions about resource utilization by predicting demand for services such as hospitals, and to detect changing patterns of customer behaviour by analyzing data in near real-time, increasing revenues and personalizing service. 

Global spending on cognitive and AI systems will reach over $57 billion in 2023, making AI a $190 billion industry by 2025.  AI will create new jobs in development, programming, testing, support, and maintenance, among others.  

AI, a subset of machine learning, is also being used in all kinds of industries, creating a huge demand for skilled professionals. Several new jobs are predicted to be created by AI, machine learning, and automation in the U.S. by 2025, including robot monitoring professionals, data scientists, automation specialists, and content curators. 

5. Making quality a priority

Customers now expect high-quality services from companies.  

Generally, this requires skilled employees and high-tech equipment – both of which are costly.  

Companies are outsourcing software development, human resources, business processes, legal processes, etc., as a result. 

Between 2022 and 2023, software development outsourcing will increase by 70%, according to Commit research.  

Furthermore, outsourcing allows companies to offer customized solutions to their clients. Customizing solutions is more likely to be done by an outsourcing company than an in-house team due to its expertise, resources, and time.

6. Maintaining business continuity

Before the pandemic, companies preferred outsourcing to multiple vendors. In contrast, according to a recent report by the University of Cambridge, most organizations want to partner with one (or a few) vendors. 

Businesses believe they can save money and ensure business continuity by partnering with fewer outsourcing companies.  

Business continuity can be disrupted by frequently changing service providers.  

When a company works with the same team for a long time, it is more likely to build a strong relationship. Having a strong bond can increase commitment and trust, which makes it easier to accomplish goals.  

Further, businesses can ensure continuity with their outsourcing partner by extending their outsourcing contract.  

When you work with a trusted outsourcing partner, you’ll have access to services even during uncertain times. 

7. Recruiting niche talent  

75% of employers find it difficult to find talent in the US, according to a ManpowerGroup survey from 2022.  

There is a shortage of talent specialized in new technologies. In a Gartner survey conducted in 2021, 64% of modern technology used in fields like network and security is hindered by this shortage. 

The time-consuming process of upskilling in-house teams is driving companies to outsource services to a vendor with expert talent in a desirable location.  

An organization can instantly gain access to expertise it lacks in-house by outsourcing to a skilled vendor.

8. Flexible and adaptable business practices

The Covid pandemic and lockdowns that followed were chaotic and disruptive. Short-term economic shocks hit many countries hard.  

Businesses and service providers are becoming more flexible regarding work due to these conditions, according to Deloitte’s 2021 Global Outsourcing Survey.  

Outsourcing providers will need to meet the growing agility demands of companies. It is acceptable if the company abruptly suspends or pauses a project. Even if there are sudden obstacles at the outsourcing destination, ensure that the work is completed before the deadline.

9. The use of modern technology

By keeping up with emerging technologies, companies can automate processes, increase efficiency, and simplify operations.  

Nevertheless, software development, automation, IoT (Internet of Things), and other modern technology are constantly changing. Companies are outsourcing technology updates to service providers since updating technology is challenging. 

Providers are experts in their fields. Due to this, they are more likely to stay up-to-date on technological advancements than in-house staff. 

10. Enhancing cybersecurity

Intruders can access inside data in several ways through digital transformation.  

In 2022, 82% of companies will be targeted by cyberattacks, according to a Forbes article. However, managing an in-house security team can be challenging. 

Hence, companies are hiring Managed Service Providers (MSPs). It is a third-party service provider that manages a specialized operation, such as data security.  

Because MSPs have cybersecurity experts and advanced solutions, companies are outsourcing cybersecurity to them. According to Statista, the market for MSPs is expected to grow to $274 billion by 2026 from $152.02 billion in 2020. 

11. Startups and small businesses are outsourcing more than ever before

By outsourcing, small businesses or startups can access the best talent and tools at an affordable price. 

Businesses outsource repetitive tasks to save time and money. As small businesses have limited payroll budgets, they are also less likely to have experienced employees. Outsourcing allows them to access top talent. 

In 2022, 90% of small US businesses plan to outsource a business process, an increase of 10% from 2021.  

The outsourcing trend will continue in 2023 and disrupt a variety of industries.

12. Nearshore outsourcing is preferred over offshore outsourcing

Nearshore outsourcing involves hiring a third party from a neighboring country to handle a business task. In contrast, offshore outsourcing involves outsourcing to a country far away, usually in another time zone. 

Nearshoring has increased in the post-pandemic world.  

In Latin America and the Caribbean, nearshore outsourcing will add $78 billion to the export sector by 2023, according to the Inter-American Development Bank. 

Bloomberg reported in 2022 that 80% of North American companies were actively considering nearshoring. 

There could be a reason for this change in companies’ supply chain management experience over a shorter distance and more minor differences in zones.  

In addition, navigating time zones and labor regulations in distant and culturally different countries, such as Malaysia, South Africa, and the Philippines, can be challenging. Some of these barriers may be overcome through nearshoring without affecting businesses’ bottom lines.   

Looking for the best place to outsource? Don’t miss our advice here.

13. Outsourcing IT to Eastern Europe

In spite of India and China dominating the IT outsourcing industry, many tech companies today are outsourcing tasks to Eastern Europe.  

In 2022, IT Outsourcing to Eastern Europe will reach $2.69 billion, according to Statista. 

Due to their proficiency in English and cultural similarity, North American companies prefer East European countries for IT outsourcing, like Romania, Ukraine, Poland, and Belarus.  

Furthermore, Eastern Europe has a high percentage of skilled workers (including tech professionals), affordable talent, and a strong data security infrastructure. 

Additionally, several Eastern European countries have low salaries compared to other countries, such as the United States or Canada. 

14. Remote work is preferred

As a result of the Covid pandemic, remote work has become the norm.  

A 2022 study by SCIKEY found that 82% of respondents prefer remote work. 

According to the study, 64% of employees feel less stressed and more productive when they work from home. 

In 2023 and beyond, this trend is expected to continue. 

15. Enhancing customer satisfaction and experience

In 2022, customer experience will remain the key brand differentiator for businesses and give them a competitive edge.  

Businesses may need to invest more in customer support and social media coverage in order to provide a better user experience.  

Companies can benefit from focusing on customer experience in the following ways: 

• Acquire customers more easily. 
• Enhance customer satisfaction. 
• Build customer loyalty and strengthen customer relationships. 

Customer call volumes can be unpredictable, however.  

In order for a company to function properly, it may need to scale up and down quickly and manage the workforce. Outsourcing customer service becomes easier as a result. 

Global Call Center Outsourcing Market’s 2022-2026 report predicts $21.72 billion in growth for the call center outsourcing industry. CAG will accelerate by 3.96% between 2022 and 2026, according to the report. When customer support is outsourced, the customer experience is enhanced and operating costs are significantly reduced. 

16. Taking steps to reduce costs

Prior to the pandemic, companies were prioritizing quality and scalability over cost reduction.  

According to Deloitte’s Global Survey 2021, 88% of surveyed companies are now outsourcing primarily to reduce costs.  

Despite clients wanting agility, scalability, and technology enablement, the primary factor influencing outsourcing decision making was the reduction of operational costs. 

While the world economy recovers from the pandemic and recessions, this trend may continue in 2023.   

17. Transparency in workflow

Most companies were unaware of the decisions made regarding an outsourced project in the past because the outsourcing provider handled it entirely. As a result, there were frequent misunderstandings. 

There is, however, a growing demand for transparent communication with outsourcing companies. 

It was found that expressive communication is crucial for transparency in a study published by the American Scientific Research Journal for Engineering, Technology, and Sciences.  

According to a Deloitte study, outsourcing contracts such as SLAs can help increase transparency. By having an SLA, your business will be able to gauge the quality of the outsourced work and hold the outsourcing provider accountable for its performance. 

Conclusion 

Following the pandemic, outsourcing has seen several progressive trends. 

By studying these trends, you can develop successful business plans for 2023. Understanding outsourcing trends can also help you manage internal stakeholders more effectively and handle uncertainties in your business.   

The top outsourcing trends listed above can help you develop a strategy for successful outsourcing in the future. 

How do you select the perfect outsourcing partner? If you need help in finding the right outsourcing partner, book a FREE APPOINTMENT with Outsource Asia experts today.