Outsourcing is a $280 billion industry — and it’s an industry in the throes of a (sometimes painful) revolution. The old days of “race to the bottom” labor arbitrage are dead, replaced by a race to drive value. But what does the future of outsourcing look like, and what outsourcing trends are shaping that future?

To answer these questions, we partnered with CMSWire to conduct a comprehensive survey of 488 leaders (68% were C-suite, owner, or partner) whose organizations leverage outsourcing in some capacity. The respondents represent a broad range of industries, with a notable 20% from the SaaS / tech sector, allowing for a deeper analysis of that space.

Our survey results revealed some significant paradigm shifts in outsourcing, as well as practical implications for the organizations that utilize their services. Be sure to check out the full report here.

Let’s dive into some trends in outsourcing that we uncovered.

1. Companies Choose Quality Over Savings When Selecting a Provider

Cost savings is table stakes in outsourcing, but when it comes to choosing a BPO partner, cost is no longer the primary consideration. 

Leaders instead demand top quality service from their outsourcing partners — 86% rated quality service as “critically important” when selecting a provider, compared to just 58% for cost savings (respondents could select more than one answer). 

The best outsourcers will continue to provide cost-saving solutions while driving value through high quality service.

2. Service Quality Matters, But It’s Also Subjective

Increased emphasis on service quality doesn’t stop at choosing an outsourcing partner — it also extends to how organizations measure the value of their BPO relationships. 

Not surprisingly, 59% of respondents identified cost savings as a key metric to measure the value of outsourced services. However, service quality ranked a close second at 51% (again, respondents could select more than one answer).

Quality is clearly important, but what quality means is less clear.

Users selected the factors we consider most closely tied to quality — like low turnover, scalability, and proven ROI — far less than quality itself, signaling significant subjectivity around what constitutes “quality” in the eyes of different organizations. But that’s okay. We’ll continue to explore (and provide!) the factors that translate to great service in a value-centric outsourcing partner.

3. Many Companies Pay More Than Expected for Outsourcing

A staggering 40% reported experiencing higher outsourcing costs than expected in the past year. This challenge resonates across industries — even in the tech sector, where cost savings are not the primary factor for measuring value.

For some organizations, “higher than expected costs” may simply mean they unexpectedly had to scale up their utilization of outsourcing services. But for others, it may suggest a disconnect between costs described in their provider’s contract and the actual costs of outsourcing services. 

As you’re inspecting an outsourcing contract, be sure to ask about any additional fees that may apply — what’s included, and what’s considered an add-on that comes with extra charges? What requires a change order? Will you need to submit a change order every time you want to scale up or adjust your strategy? Asking these questions ahead of time will allow you to better align your cost expectations with your provider’s policies. 

4. Satisfaction Isn’t Enough

Despite 45% of respondents being “very satisfied” with their current outsourcing vendors, 73% said their organization is either considering or actively seeking alternative providers. 

This high willingness to switch providers demonstrates that organizations are no longer settling for services that simply meet their needs. They know there are dozens of other vendors out there, and they’re always on the lookout for new partnerships that can deliver more value. 

At SupportNinja, we’re not satisfied being just another “good enough” BPO provider. We deliver agile, tech-enabled people solutions — and we’ve radically altered the way we do business to provide value at every step.

5. AI Matters, Especially in the Tech Sector 

AI is at the top of almost every “future of work” trends list, so it’s no surprise that it’s now a key component of outsourcing offerings — 78% say their outsourcing vendors have at least some AI capabilities. 

The tech sector is particularly eager to embrace AI. Here are a few ways that SaaS and tech showed higher enthusiasm for AI-enabled services than respondents in other industries:

• 84% say it’s either moderately or very important for their outsourcing vendors to have AI capabilities (compared to 71% of respondents in other industries)
• 96% agree that humans and AI working together provide better results than either on their own (compared to 87%)
• 52% rely on an outsourcer who is actively leveraging AI solutions to improve operational efficiency (compared to 38%) 

6. It Pays to Be Proactive

Among respondents who characterize their organizations as "proactive" about outsourcing, 62% report that the current economic climate has “no impact” on their outsourcing decisions. In contrast, only 23% of all respondents felt their outsourcing choices were unaffected by the economy.

What does it mean to be proactive about outsourcing? 

It starts with recognizing outsourcing as a tool to drive long-term growth and success, not just a band-aid solution for talent shortages and operational bottlenecks. 

Choosing to proactively incorporate outsourcing into your organization’s strategy can save time and headaches down the road. While a reactive approach might leave you scrambling to select a provider and onboard outsourced talent on a tight timeline, a proactive approach ensures that your outsourced teams are up and running before your operations are impacted. 

What outsourcing trends will define 2024? Read more. 

Finding Success in a Changing Market

As our survey results illustrate, the outsourcing landscape is changing. Instead of focusing solely on cost savings, companies are now prioritizing service quality — and they’re no longer settling for “satisfactory” performance from their vendors. 

In this market, BPO providers have to take a value-centric approach to outsourcing. And at SupportNinja, we do just that. We demonstrate quality by aligning with your objectives, remaining agile enough to scale with you, and maintaining industry-high talent retention rates.

Want an outsourcing provider that keeps up with the latest industry trends? Contact us today.