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Outsourcing Activity Drops in the EMEA Region

by: Sarah Joson

Monday, July 30, 2012 | Outsourcing News |

Decline in BPO activity

According to the EMEA (Europe, the Middle East, and Africa) TPI Index released by the Information Services Group (ISG), the volume of outsourcing deals has declined 29 percent over the years. ISG added that the total contract value dropped 21 percent during 2011’s Q2 up to present. For this year alone, outsourcing deals dropped 11 percent during Q2.

Two outsourcing segments were identified at ComputerworldUK as to have noticeably dropped in total contract value. IT outsourcing (ITO) posted a 26 percent decline and dropped to €9.1 billion. On the other hand, business process outsourcing (BPO) fell to €5.1 billion, a 27 percent decline.

Duncan Aitchison, EMEA Partner at ISG, said the situation is driven by the lack of mega-deal activity and fewer contract deals in general - even small ones. He added that there is still a possibility for the UK to recover as he sees that companies based in the region will turn to multi-sourcing to resolve outsourcing issues.

Meanwhile, the UK region was hit hard by the unstable economy in the eurozone with outsourcing deals dropping 16 percent year-on-year. KPGM Institute noted that those who are planning to outsource have in fact dropped 25 percent from 2010. Moreover, 12 percent were not happy with their service provider, while 46 percent remain unsure.


Source:
http://www.supplychaindigital.com/

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