Market analysts claim that overall value of IT outsourcing market in 2020 alone, exceeded 220 billion USD. This number is going to grow by about 5% year to year in the next decade. Looking at multiple expert reports, analyses, trend reports, there seems to be one prevailing driver behind this trend: increased effectiveness. What’s hiding under this term is that all software development, updates or improvements are performed exactly how the client envisaged it.
Other key drivers behind the growth is lack of in-house resources or expertise, increased business flexibility and difficulties in creating internal structures (time requirements, budget constraints, high employee turnover etc.). Businesses are motivated to ensure high price-quality ratio. For many of them, outsourcing IT processes is the only solution to achieve satisfactory results.
Having taken what kind of impact import has on the IT outsourcing market for businesses globally into consideration, we present some of InfoSoftware’s expert insight in regards to the upcoming year.
Cloud-based systems and technologies are in steady growth since the day they were launched. One of the greatest advantages of this technology is grating access to the “latest and greatest” software solutions without the need to suffer costs of expanding IT infrastructure of your business. More importantly, cloud technologies allow easy integration of advanced tools including Big Data, advanced data analysis, IoT integration, AI and machine learning, digital automation and containerization of processes.
During 2020, popularity of cloud-based solutions exploded. Much of this can be attributed to AWS and Azure solutions facilitating all the work that needs to be done for a successful migration to cloud. COVID outbreak and the pressure to organise remote-friendly work environment certainly accelerated the trend. This is why we expect to see even more of cloud-based solutions and technologies in 2021.
Big Data, AI and machine learning
All of these technologies work in conjunction to cloud-tech. It’s a simple synergy. AI and machine learning depend on cloud for proper operation, and much of the cloud’s value for businesses is the ability to get AI and machine learning to work on the data a business is processing. According to PwC studies, the impact of AI on global economy will grow to about 15 trillion USD by 2030. Employing the power of these technologies gives business the necessary edge to perform advanced analytics and optimisation of business processes. processes. Digitalization and automation of production processes around the world will also cause the demand for AI and machine learning to grow. We expect that demand for advanced software will grow exponentially in the areas linked with industrial production.
One of the consequences of rapid development of IT tools, systems, and overall digitalisation of business processes is the need to increase security measures.
More processes are performed online, more data is gathered on company servers, bigger part your business operations depend on IT. Shifting back to analogue seems like going back to the stone age. This means that the data and systems are of crucial value to the company their operating for but also to potential competition. There is no doubt that in 2021will see a rise in the number of illegal attempts to access data or systems owned by businesses.
It should be no surprise for anyone, that external services aimed at ensuring the security of corporate networks and critical data are becoming more and more popular. Contracting the right team of specialists might be the key to success as data show that cybercrime costs are currently higher than those caused by natural disasters.
Web and Mobile Applications
The rise of mobile technologies changed the way the world goes around. Of course, native apps are safer and faster, but developing a separate version for Android and iOS usually takes time of two development teams, specialised in different programming languages. For that reason, the development of native apps is usually outsourced.
Not only the number of smartphones users is still at a fast-paced growth but also the number of functions that smartphones are fulfilling. Applications will play an increasingly important role. This is why we see a bright future for all technologies related to making the development process faster and more efficient.
One solution might be a swich to web apps, which can be developed once and function on all types of devices. Web apps are much cheaper to create and maintain, they offer the most innovative technical solutions and often can compete with the performance of native apps. Another option would be UI toolkits like Flutter, which offers the ability to design native apps out of a single source code without the need for two parallel development processes. Progressive Web Apps are much more than just a hype.
While e-commerce is nothing new, this sector never grew at such rates. Values and profits of online stores and logistic companies are at record breaking level all over the globe. The biggest change is that even people aged 65+ are now e-shop on a regular basis.
It is often pointed out that User Experience is the most important key to success for an e-commerce businesses. Many of the e-stores are willing to invest in improving UX and make use of AI technologies, such as chatbots or data analysis software. All of it will be aiming at delivering more personalised experience to a customer.
In times where up to 80% of e-commerce customers make their purchases without any human interaction, the quality of software and algorithms can be the life or death of a company.
Your IT is in Central Europe
Central and Eastern Europe is becoming more and more attractive as a location for outsourcing services. Studies show that about 70% of the global demand is being served in Poland, Ukraine, Romania and Belarus. There are several reasons behind this trend. The simple answer would be to point out at excellent quality and work ethics in conjunction with low costs of work (which is the biggest cost of software development).
Of course, reality is always more complex. Cultural aspect and communication can prove to be more important than any other aspect. Contracting the cheapest team might be tempting but it’s usually the biggest mistake.
The key to success is to ensure that all communication is smooth, and all information is conveyed smoothly between you and the team working on the job. This usually requires contracting an experienced, professionally managed team. Such teams will never be the least expensive to employ, but going with them will save you months of bug fixing and patching before the final product is ready for launch. These qualities are the biggest advantages of companies based in Baltic States and Poland, as these companies often achieve perfect results in various tests emphasizing quality of their work.
Companies that wish to avoid falling behind are already making investments in the digital transformation. The main challenge is still the speed of innovation. Even the biggest enterprises do not possess the talent pool and the resources to keep up on their own. External teams are the answer for growing needs. More importantly, maintaining quality standards will require getting the best specialist in a slim talent pool. Development potential of your business is likely to depend on your ability to efficiently organise IT outsourcing processes.