EquaTerra Survey Reveals Steady Growth of Cloud Computing Outsourcing in 2011

EquaTerra Survey Reveals Steady Growth of Cloud Computing Outsourcing in 2011

Cloud computing will dominate IT outsourcing market while demand for outsourcing and third-party services is expected to grow moderately in 2011, the fourth quarter 2010 Pulse survey by EquaTerra revealed. The survey reflects business and IT service market activity during fourth quarter of last year, and those polled include global business and IT service providers like ACS, a Xerox company, Atos Origin, Caliber Point, Capgemini, Ceridian, Cognizant, CSC, HCL Technologies, HP, IBM, ICG Commerce, Mercer, Outsource Partners International, Steria, Syntel, TCS, and Wipro.

The Pulse surveys focus on using outsourcing and other third-party services to support the following functional areas: customer care/call center, finance & accounting (F&A), human resources (HR), information technology (IT), knowledge process outsourcing (KPO), procurement/ source-to-pay, and vertical industry business services.

Overall, BPO (business process outsourcing) and ITO market demand in the last quarter followed the same trend of slow pace of growth reported previous quarters in 2010, the survey showed. The use of cloud computing as a means to enable outsourcing or in lieu of outsourcing in some cases continues to become more prevalent, EquaTerra analysts concluded. The survey also showed that it is quite improbable to witness new mega-outsourcing deals in foreseeable future due to a more pragmatic, realistic and cautious approach in using third-party services.

Vertical industry services as well as functional and process ares are more likely to report significant outsourcing growth since these areas did not enjoy such massive outsourcing in the past. The challenge ahead of buyers will be their ability to manage multiple outsourcing engagements and growing number of relationships with service providers, the survey said.

Those polled cite the following main challenges:

  • Retained organization, relationship management and outsourcing governance
  • - Inadequate executive and management support
  • - Change management concerns
  • Internal political pressure

The top trends that will dominate the IT sector and IT service market in 2011 include the following:

  • Cloud computing overall
  • Cloud computing in lieu of outsourcing
  • Global sourcing/globalization
  • Poor economic conditions, debt crisis, etc. driving MORE outsourcing
  • Social media/networks used for business purposes

Adoption of Cloud Computing will dominate the market in 2011 while buyers will switch their efforts to aspects of Cloud Computing like business case development and validation, pricing and pricing model assessment, legacy systems migration plans and time-line development, the survey showed.

Cloud computing uptake in 2011 will cover the following top expected areas of care:

  • SaaS (software as a service) desktop applications (e.g., email, collaboration, messaging). EquaTerra advisers ranked this aspect first while service provided voted it third
  • Infrastructure (e.g., data center services, storage,back-up, development/testing – IaaS (infrastructure as a service)/PaaS (platform as a service)): service providers acknowledge it is as the top aspect while EquaTerra advisers rank it second
  • SaaS customer relationship management (e.g., CRM, such as Salesforce.com)
  • Business process as a service (BPaaS) or cloud-based “platform BPO”

Overall, IT sector will witness further globalization of business and IT services in 2011, which is not unexpected, and buyers will diversify even more the locations of outsourcing services. Broader range of services will go offshore while the growth of global sourcing will keep its faster pace of growth challenging buyers’ abilities to manage these growing complex efforts, the report concluded.  Thus, potential benefits could be jeopardized and failed efforts would be observed.

By Kiril Kirilov

One Response to EquaTerra Survey Reveals Steady Growth of Cloud Computing Outsourcing in 2011

Cloud Infographic – Interesting Big Data Facts

Cloud Infographic – Interesting Big Data Facts

Interesting Big Data Facts You Didn’t Know The term Big Data has been buzzing around tech circles for a few years now. So much, in fact, that you’re probably getting sick of hearing about it. Here are some interesting facts you might not know about big data via The Visual Capitalist: Big Data got its start in…

Cloud Infographic – Cyber Security And The New Frontier

Cloud Infographic – Cyber Security And The New Frontier

Cyber Security: The New Frontier The security environment of the 21st century is constantly evolving, and it’s difficult to predict where the next threats and dangers will come from. But one thing is clear: the ever-expanding frontier of digital space will continue to present firms and governments with security challenges. From politically-motivated Denial-of-Service attacks to…

The Industries That The Cloud Will Change The Most

The Industries That The Cloud Will Change The Most

The Industries That The Cloud Will Change The Most Cloud computing is rapidly revolutionizing the way we do business. Instead of being a blurry buzzword, it has become a facet of everyday life. Most people may not quite understand how the cloud works, but electricity is quite difficult to fathom as well. Anyway, regardless of…

Cloud Computing Adoption Continues

Cloud Computing Adoption Continues

Cloud Computing Adoption Continues Nowadays, many companies are changing their overall information technology strategies to embrace cloud computing in order to open up business opportunities.  There are numerous definitions of cloud computing. Simply speaking, the term “cloud computing” comes from network diagrams in which cloud shapes are  used to describe certain types of networks. All…

Five Signs The Internet of Things Is About To Explode

Five Signs The Internet of Things Is About To Explode

The Internet of Things Is About To Explode By 2020, Gartner estimates that the Internet of Things (IoT) will generate incremental revenue exceeding $300 billion worldwide. It’s an astoundingly large figure given that the sector barely existed three years ago. We are now rapidly evolving toward a world in which just about everything will become…



Cloud Logo Sponsors

hp Logo CityCloud-PoweredByOpenstack-Bluesquare_logo_100x100-01
cisco_logo_100x100 vmware citrix100
Site 24x7

Contributor Spotlight

Established in 2009, CloudTweaks is recognized as one of the leading influencers in cloud computing, big data and internet of things (IoT) information. Our goal is to continue to build our growing information portal, by providing the best in-depth articles, interviews, event listings, whitepapers, infographics and much more.


CloudTweaks Media
Phone: 1 (212) 763-0021

Branded Content Programs