Business Process as a Service (BPaaS) Market Size, Share & Trends Analysis Report By Business Process, By Organization, By Application (BFSI, Telecom, Manufacturing, Healthcare, Government), And Segment Forecasts, 2018 - 2025

Industry Insights

The global Business Process as a Service (BPaaS) market size was estimated at USD 32.66 billion in 2016. The market is anticipated to witness considerable growth in the coming years owing to reduced operational costs, lower Total Cost of Ownership (TCO), and a faster time to market (TTM).

BPaaS covers a host of vertically integrated components of hardware infrastructure, database, middleware and business application software, optimized processes, and people. Nowadays, BPaaS models have demonstrated successful outcomes for various business processes and are being increasingly adopted by small and medium enterprises (SMEs).

Key players are allocating significant resources to identify key opportunity areas and keep up with growing competition in the market through continuous software upgradation. Introduction of government regulations and increased use of cloud computing have rendered the industry highly competitive.

BPaaS allows for improved customer experience. It provides end-to-end delivery for various business processes such as accounting, human resource management, customer services, sales, and marketing. These are flexible business models that help optimize capital expenditure (CAPEX), while making operational expenses (OPEX) predictable and proportionate to business volumes.

A major roadblock in the growth of the market for BPaaS is data security. Hampered productivity and data violation are some of the concerns plaguing the industry.

Business Process Insights

Customer service and support is anticipated to register a strong CAGR of 9.6% over the forecast period. Growth of the segment can be attributed to increasing number of organizations looking to revamp their customer service operations. Focus is on decreasing operational costs while dynamically scaling up operations/processes related to smaller product life cycles. Customer service and support platforms help in managing the entire customer service lifecycle, including customer care, asset/warranty management, contract management, field force management, and service performance management.

Accounting and finance held the largest share of over 27.0% in 2016. These business processes help in optimizing financial processes to drive revenue growth, improve margins, and expand cash flow.

Organization Insights

Large enterprises dominated the BPaaS market in 2016, accounting for USD 22.76 billion that year. The segment is expected to expand at a CAGR of 8.6% over the forecast period. Most large enterprises focus on managing associated operations and practices, which are prone to attacks by malware, spams, and viruses. BPaaS has emerged as an ideal solution to these threats. Large enterprises are mainly involved in systematic business operations such as HRM, maintaining company accounts, measuring sales and other financial records of a company, recording employee and customer data, and other procurement-related services.

Small and medium enterprises (SMEs) are expected to grow at the fastest rate over the forecast period. These enterprises are moving toward processing their services and gaining competitive edge. They are also taking advantage of reduced costs of operations and falling total cost of ownership. This is sure to benefit the segment during the course of the forecast period.

Application Insights

The banking, financial services, and insurance (BFSI) segment held the largest share of USD 8.26 billion in 2016. Increasing adoption of cloud computing has resulted in improved focus on attaining efficiency and rebalancing expenses on systems. This is anticipated to drive the BFSI application segment by 2025.

BPaaS helps SMEs and online retailers in improving their marketing, sales, and services, which in turn, is likely to boost its application in the ecommerce and retail sector. The segment is expected to register the fastest growth rate over the forecast period, supported by favorable government regulations and rising startups in the industry.

Regional Insights

The Asia Pacific market was valued at USD 4.90 billion in 2016 and is expected to register the highest CAGR during the forecast period. Growth in the region can be attributed to increasing number of startups coming up in the retail and consumer goods sectors in countries such as China, India, and Japan.

North America holds the largest share in the market. The U.S. government and the healthcare sector in the country have extensively adopted business process as a service owing to soaring adoption of cloud computing. In addition, strategic agreements and partnerships are helping to create awareness among users, further boosting the market. For instance, in 2017, Cognizant announced that it had entered into a definitive agreement to purchase Health Care Service Corporation (HCSC)’s subsidiary TMG Health.

BPaaS Market Share Insights

The global market is highly competitive in nature, particularly among existing players and new entrants. Key industry participants includeCognizant, Wipro, TCS, and Capgemini. Growing deployment of cloud-based solutions and adoption of BPaaS platforms by large enterprises have provided major opportunities for companies such as Cognizant, Accenture, and EXL, allowing them to gain a major share in the market.

Strategic partnerships, agreements, new product development, and acquisitions are some go-to growth tactics adopted by players. For instance, in February 2016, Wipro acquired HPH Holdings Corp. (Healthplan Services). HealthPlan Services offers technology platforms and a fully integrated BPaaS solution to health insurance companies. In November 2016, Genpact announced the launch of an innovative platform that drives rapid, largescale transformation and changes the business model for online commercial lending. This will help companies create agile systems to improve operations and gain a better position in the market.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis on latest industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global Business Process as a Service (BPaaS) market report on the basis of business process, organization, application, and region:

• Business Process Outlook (Revenue, USD Million, 2014 - 2025)

  • Human Resource Management

  • Accounting and Finance

  • Sales and Marketing

  • Customer Service and Support

  • Procurement and Supply Chain

  • Operations

  • Others

• Organization Outlook (Revenue, USD Million, 2014 - 2025)

  • Small and Medium Enterprises

  • Large Enterprises

• Application Outlook (Revenue, USD Million, 2014 - 2025)

  • BFSI

  • Telecom & IT

  • Manufacturing

  • Ecommerce and retail

  • Healthcare

  • Government

  • Others

• Regional Outlook (Revenue, USD Million, 2014 - 2025)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • Rest of Europe

  • Asia Pacific

    • China

    • India

    • Japan

    • Rest of APAC

  • Latin America

    • Mexico

    • Brazil

    • Rest of South America

  • Middle East & Africa