Industry InsightOutsourcing

2014 One of the Best Years Ever for Outsourcing, Suggests ISG Index

The global outsourcing industry delivered one of its best years ever in 2014, capped by double-digit growth in the fourth quarter fueled by a buyer’s market in the Americas, a jump in mega-relationships, and a rise in contract restructurings, Information Services Group (ISG), a leading technology insights, market intelligence and advisory services company.

Data from the ISG Outsourcing Index, which measures commercial outsourcing contracts with annual contract value (ACV) of $5 million or more, show that fourth-quarter ACV surged 27 percent, to $5.8 billion, over the prior year as the number of contracts grew by 6 percent. For the full year, ACV reached $23.1 billion, up 16 percent, while contract counts edged up 4 percent, to 1,218, the second-highest level ever, the press releases said.

The biggest highlight from the report is result from Asia Pacific, ACV increased by 45 percent over the prior year, while contract counts climbed 11 percent.

By domain, information technology outsourcing (ITO) continued to log steady growth in ACV, up 13 percent for the quarter and 19 percent for the year, to close out 2014 at $17.3 billion. The uneven business process outsourcing (BPO) market had a strong fourth quarter, growing 80 percent to finish the year up 8 percent, at $5.8 billion.

In Asia Pacific segment NGA and Ramco stand out, only organization proving Human Capital outsourcing services. Both the organization were part of the Breakthrough 10 Sourcing Standouts category for the Asia Pacific and Japan (APJ) region based on annual contract value (ACV) won over the last 12 months.

NGA’s success in the Asia Pacific region can be attributed primarily to the rapid adoption of cloud HR systems and payroll outsourcing by Australian companies, both operating domestically and internationally,  press release from NGA cited.

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*ACV (Annual Contract Value)

For detailed report, click here.

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