Global Sourcing Trends In 2010
Mondaq Business Briefing › United States Law Articles in English (2010)
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Global Sourcing Trends In 2010
Executive Summary of 2010 Outsourcing Trends
Global Economic Problems Recession and Recovery In outsourcing terms, the verdict on 2009 was "it could have been so much worse." Cost cutting was the main driver and re-negotiation the main activity. The key questions for the outsourcing world in 2010 are: What sort of recovery in the world economy will we see? Will the recession return after cost-cutting outsourcing deals have already been done? Will the predictions of different shaped recovery curves in the U.S.A., Europe, and Asia cause splits in global outsourcing deals as economies move out of recession at different rates? Outsourcing is one way for organizations to position themselves to capitalize on the recovery and show that their overall strategy is about value creation, not merely cost containment. It's All About Cost Cost remains the key for 2010. Outsourcing prices dropped in 2009 and that trend seems likely to continue in 2010, although the rate of decline will slow. Service providers may not be prepared to be as accommodating as they were in 2009. Many outsourcing projects were put on hold in 2009, so market activity in 2010 should be busier overall, which should slowly cause prices to stabilize. Flexibility: Doing More With Less Shorter deal cycles will remain the norm. Companies want to close deals as soon as possible. The trend of DIY sourcing by internal teams will continue with less reliance on outside help. This will favor incumbent suppliers, and service providers will be keen to win contract renewals to boost revenues even if margins remain slim. We may even see a renewed emphasis on shared services across the entire sector with competitor...See the full content of this document
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