Business Process Outsourcing Market Size, Share & Trends Analysis Report By Service Type (Customer Services, Finance & Accounting), By End-use (IT & Telecommunication, BFSI), By Region, And Segment Forecasts, 2023 - 2030

Report Overview

The global business process outsourcing market size was valued at USD 261.9 billion in 2022 and is projected to expand at a compound annual growth rate (CAGR) of 9.4% from 2023 to 2030. BPO refers to the process of outsourcing operations and responsibilities of many business functions to external service providers. These services find prominent demand due to their benefits such as increased flexibility, reduced costs, and enhanced service quality. Moreover, the market allows businesses to refocus on their core business activities to deliver incremental value to their customers. Owing to these benefits, BPO services witness demand across end-use industries such as healthcare, BFSI, and IT & telecommunications. 

The factors such as the rising focus of enterprises on improving efficiency and organizations’ agility, reducing operating costs, and accelerating core competencies to survive the constantly changing business dynamics drive the growth of the business process outsourcing market. Moreover, many organizations are focusing on reducing the cost of conducting business to accessing worldwide resources to meet the increasing industry demands. These aspects have encouraged the adoption of market services across several organizations that focus on technological trends such as cloud computing and Artificial Intelligence (AI) for driving business efficiency. Additionally, the impact of COVID-19 raised the demand for standardized platform services which offer BPOs to resolve complex business processes, thereby generating avenues for business process outsourcing market growth.

The increasing popularity of cloud computing in business process outsourcing is one of the prominent factors influencing the adoption of BPO services. Cloud computing aids BPO operators in increasing the time to market, reducing costs, and improving the quality control process. Moreover, cloud computing in the market assures instant computing support and system access, universal access, and flexible provisioning whenever needed for required business purposes. These benefits are expected to positively impact the adoption of cloud computing in the BPO market during the forecast period.

Concerns related to security and intellectual property rights are expected to restrain the growth of the market in the forecast period. The urge to reduce operational price lands the outsourcer in countries that do not have an established regulatory framework that is responsible for protecting the outsourcer from breach of confidentiality and violation of intellectual property rights. As a result, outsourcing companies are often concerned with the way they outsource and handle the information shared and are observed to be reluctant as even a small error can result in a permanent setback with respect to the company’s market position. Additionally, the rising of government initiatives implemented to promote the adoption of cloud technology in the outsourcing sector is anticipated to the growth of the BPO market.

The impact of COVID-19 led to economic and social disruptions and created challenges in outsourcing functions. However, the changes brought to business activities due to these disruptions are expected to provide impetus to the market in the long run. BPO companies have changed their business models by restructuring their Business Continuity Plans (BCP) to a distributed workforce. Businesses have realized the importance of continuous operations planning and disaster recovery to build a more reliable business model that can survive an unprecedented disruption like the COVID-19 pandemic. In 2020, the major vendors of the market, including Accenture and Infosys Limited (Infosys BPM) stated that due to COVID-19, more than 80-90% of their employees were working from a remote location. The resultant disruption caused in the workforce management process, lack of infrastructure equipment, and increased data security risks led to a reduction in work efficiency and delays in project completions in the market.

Service Type Insights

The customer services segment dominated the market in 2022 with a revenue share exceeding 30%. The segment is anticipated to retain its dominance and lead the CAGR in the forecast period. This segment is attributed to the rising number of service centers across the globe that need offline and online technical support. Customer service-based business process companies are specialized in handling customer requirements and queries that are generated through social media platforms, chats, phone calls, emails, and other channels. Furthermore, most of them provide self-service support, so customers find answers to their queries at any time.

The finance and accounting segment is predicted to witness significant growth over the forecast period. This can be ascribed to the rising number of banking facilities and stringent regulatory requirements in the banking sector, resulting in the need for outsourcing services that can bring a significant reduction in operating costs. Moreover, the human resource service segment is also anticipated to grow substantially in the forecast period, due to the rising need for resources across areas such as payment processing, recruitment and relocation, administration, and other employee benefits services.

End-use Insights

The IT & telecommunication segment held the largest revenue share in 2022, accounting for around 34.0% of the overall market. The increase in the number of IT businesses and rapid industrialization globally are some of the factors boosting the demand for business process services across IT and telecommunication companies. IT & telecom BPO services cater to the increasing demand for connectivity, address security issues, and innovate new offerings for the latest devices and technology standards. Telecom companies outsource business functions, ranging from call-center outsourcing to billing operations to finance and accounting. Outsourcing enables telecom companies to reduce their capital expenses, access specialized resources, optimize current investments, create a flexible strategy for acquiring and retaining more customers, and manage cost pressures. 

The BFSI segment is likely to witness the fastest growth by 2030 and a CAGR of over 10.0% in the forecast period. Financial institutions are adopting BPO as an instrument to improve their cost efficiency. To advance BFSI customer services, many BFSI businesses are opting for outsourcing processes for various BFSI domains, including investment management and asset management.

Regional Insights

North America accounted for over 35% revenue share of the market in 2022 and is expected to grow steadily over the forecast period. The region is expected to retain its dominance due to the rising demand for business process outsourcing services from several tech giants in the region. Customization of service offerings to better meet individual needs, coupled with the increasing demand for cloud computing, is further expected to support regional growth. Similarly, the European market is also expected to record healthy growth, driven by the availability of a skilled workforce, coupled with the quality of service and operational efficiency.

Asia Pacific is predicted to register the highest CAGR from 2023 to 2030 due to reduced labor costs, rising demand for talented professionals, and significant digital investments by key vendors such as HCL Technologies Limited, Infosys Limited., Accenture, and Wipro. For instance, in December 2020, HCL Technologies Limited entered Vietnam. The business expansion allowed the company to hire highly skilled expertise and offer enhanced IT solutions across the country. Furthermore, it also allowed the company to expand its market presence in the Asia Pacific.

Key Companies & Market Share Insights

The key market players that dominated the global market in 2022 include Accenture, Amdocs, Infosys Limited, HCL Technologies Limited, CBRE, Wipro, and Capgemini. Companies engage in inorganic growth strategies such as mergers & acquisitions, partnerships, and geographical expansion to stay afloat in the highly competitive market. For instance, in September 2022, Capgemini acquired Aodigy Asia Pacific, specializing in digital transformation on the salesforce platform. Aodigy Asia Pacific enables Salesforce customer engagement solutions such as customer interaction, sales optimization, business process automation, and cloud migration via its operations in Vietnam and Singapore. This acquisition will provide sustainable business values to customers across the region with cloud, digital, and data services. Furthermore, in October 2021, Amdocs signed a seven-year partnership with VEON Ltd., a connectivity and internet service provider, to offer innovative digital services to customers of VEON from Uzbekistan and Kazakhstan.

Apart from increasing their size and broadening their reach, companies focus on market trends to develop technologically advanced and differentiated services to gain a competitive edge. The rising flexibility of business process outsourcing services is helping strengthen market growth as several end-use industries, including IT and telecom, healthcare, banking, financial services, insurance, and manufacturing, employ these services. In September 2020, Infosys McCamish announced the launch of a new industry platform called Infosys McCamish NGIN. Aimed at the global life insurance and annuity industry, the platform is based on an evolutionary architecture and can be configured to address the regional and global requirements of insurance carriers. Some prominent players in the global business process outsourcing market include:

• Accenture

• Amdocs

• Capgemini

• CBRE

• HCL Technologies Limited

• Infosys Limited (Infosys BPM)

• NCR Corporation

• SODEXO

• TTEC

• Wipro             

Recent Developments

• In June 2023, TTEC Holdings announced the opening of the TTEC Digital Innovation Studio in Hyderabad. This development is expected to enhance TTEC’s capabilities in offering improved customer experiences globally, while accelerating its development and integration with notable CX technology platforms, such as Amazon, Microsoft, and Google, among others

• In June 2023, Wipro Limited inaugurated the company’s new office at Sable Park in South Africa’s Cape Town, emphasizing the company’s focus on investing and expanding its presence in the country. This is expected to accelerate the employment and skill development opportunities for the booming BPO sector in Cape Town in the near future, which contributes significantly to the regional economy

• In May 2023, TTEC Holdings inaugurated a new customer experience delivery center in in San Pedro Sula, Honduras, enabling the company to offer digital CX services to clients across various industries. TTEC also expects this development to open up several job opportunities in the region, which has a sizeable English-speaking talent pool

• In May 2023, HCLTech announced that it would be expanding its partnership with SAP, by becoming a customer of and a global strategic service partner for SAP SuccessFactors Human Experience Management Suite, for driving the digital transformation for enterprises. HCLTech will leverage this solution for improving employee experience and create a more agile recruitment and onboarding process

• In March 2023, HCLTech announced the company’s plans of operational expansion in Romania through the hiring of over a thousand people in the country by 2025. As part of this process, the company would scale up its offices in Iasi and Bucharest. HCLTech currently offers employment to around 1000 people in the country, and 33% of the future roles would be offered to graduates from Romanian universities

• In March 2023, Accenture announced its plans to acquire Optimind, a leading Paris-based consulting firm that specializes in the areas of risk management, digital transformation, compliance, finance & accounting services, human resources, and business process outsourcing

• In July 2022, NCR Corporation announced the addition of Stater Bros. Markets to the NCR Commerce Platform (NCP), for improving customer experience and minimizing infrastructure complexity. Stater Bros. Markets, which is the biggest privately-owned supermarket chain in Southern California, is utilizing the NCR Emerald cloud-based POS solution, which uses NCP to unify technologies that are needed to operate stores 

Business Process Outsourcing Market Report Scope

Global Business Process Outsourcing Market Segmentation

The report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global business process outsourcing market report based on service type, end-use, and region.

• Service Type Outlook (Revenue, USD Billion, 2018 - 2030)

  • Finance & Accounting

  • Human Resource

  • KPO

  • Procurement & Supply Chain

  • Customer Services

  • Others

• End-use Outlook (Revenue, USD Billion, 2018 - 2030)

  • BFSI

  • Healthcare

  • Manufacturing

  • IT & Telecommunications

  • Retail

  • Others

• Region Outlook (Revenue, USD Billion, 2018 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Rest of Europe

  • Asia Pacific

    • China

    • India

    • Japan

    • Rest of Asia Pacific

  • Latin America

    • Brazil

    • Mexico

    • Rest of Latin America

  • Middle East & Africa (MEA)