Knowledge Process Outsourcing (KPO) Market Analysis By Service, By Application (BFSI, Healthcare, IT & Telecom, Manufacturing, Pharmaceutical, Retail), By Region, And Segment Forecasts, 2018 - 2025

Industry Insights

The global Knowledge Process Outsourcing (KPO) market size was valued at USD 28.94 billion in 2016 and is expected to grow over the forecast period. The increasing need for higher flexibility in Service Level Agreements (SLAs) and ease in change management practices along with cost cutting is anticipated to boost the growth of KPO industry.

Outsourcing critical processes involved in their system enables industries to save a significant amount of time and money. The rising demand for professional services such as training, research, managed services, and maintenance is further instrumental in accelerating the industry growth. In emerging economies such as China, India, and Philippines, there are highly skilled professionals such as engineers, lawyers, architects among others who are ready to provide professional services at lower costs as compared to their western counterparts.

The presence of abundance of data across the globe has made it difficult to extract useful information from the available sources. In such a case, companies approach KPO firms that hire knowledge experts in various fields and apply different tools for analyzing business processes and simplifying decision making.

However, increasing regulations pertaining to unemployment in specific regions, owing to lack of talent, are expected to hamper the growth of the market. Moreover, skilled workforces are paid average salaries and expected to perform tasks at a low cost as KPO firms are facing high attrition issues, thereby posing a challenge to the market growth.

Services Insights

Legal process outsourcing is estimated to emerge as the fastest growing service segment in the market, owing to the efficiency of services provided and reduction in cost. The segment is expected to grow at a CAGR of 21.5% from 2017 to 2025. Legal functions that are usually outsourced include legal analytics, contract management, and litigation management.

Analytics and market research services have captured the largest market share in the KPO industry due to an increased demand for business intelligence and analytical tools that reduce employee burden. The analytics and market research segment was valued at a market size of USD 10.54 billion in 2016.

Apart from these, other services, which include engineering & design, financial process, and research & development outsourcing, are expected to grow at a faster pace over the forecast period. Technological advancements have resulted in the development of new tools to provide knowledge-based services to clients.

Application Insights

The adoption of knowledge process outsourcing services in IT & telecom sector is gaining traction. The segment is presumed to grow at a CAGR of 20.8% over the next eight years. Owing to extensive database in the IT and Telecom sector that is fragmented and increasing over a period of time is expected to accelerate the market growth over the forecast period.

The BFSI segment is dominating the market owing to large number of applications in the segment. The BFSI segment includes sensitive information regarding customers and financial databases of numerous banks. In order to maintain information efficiently, companies outsource processes such as financial analytics, equity research, and data management, among others. Few companies that provide financial services to other firms are CRISIL Ltd., Credit Suisse Group AG., and WNS (Holdings) Ltd. among others.

Regional Insights

The Asia Pacific region was valued at USD 22.23 billion in the year 2016 that dominated the market with a maximum number of KPO firms and consultancies in the region. This can be attributed to the rapid off-shoring of critical processes and professional services. The increasing presence of skilled professionals such as engineers, architects, lawyers in emerging economies, such as India, China, and Philippines, is driving the market growth.

Latin America is expected to emerge as the fastest-growing region that is anticipated to reach a CAGR of 20.0% over the next eight years. Enterprises in the region are increasingly focusing on R&D and developing their analytical insights, which is estimated to propel the market growth over the forecast period.

Competitive Insights

Prominent players dominating the market include Accenture, EXL Services, Genpact, McKinsey and Company, Moody’s Investors Service, Inc., Mphasis, RR Donnelley & Sons Company, Wipro Limited, and HCL, among others.

Industry players are primarily focusing on exploring opportunities in order to develop newer ways and techniques for offering their services to clients. In a bid to maintain a strong position in the market, companies have appointed different teams for performing research on tools and implementing them while providing services to clients. For Instance, in 2016 McKinsey launched a new brand named Digital McKinsey, that comprised special team of data engineers, developers, designers, and advanced analysts among others. On the similar grounds Accenture PLC (U.S.) launched a Digital Hub in 2017, responsible for development and delivering solutions to the clients.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the Knowledge Process Outsourcing (KPO) Market on the basis of services, applications, and regions:

• Service Outlook (Revenue, USD Million; 2014 - 2025)

  • Analytics & Market Research

    • Customer & Marketing Analytics

    • Operations & Supply Chain Analytics

    • Competitive Intelligence & Industry Analysis

  • Engineering & Design

  • Financial Process Outsourcing

  • Legal Process Outsourcing

  • Publishing Outsourcing

  • Research & Development Outsourcing

  • Others

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

  • BFSI

  • Healthcare

  • IT & Telecom

  • Manufacturing

  • Pharmaceutical

  • Retail

  • Others

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

  • North America

    • U.S.

    • Canada

  • Europe

    • UK

    • Germany

  • Asia Pacific

    • China

    • Philippines

    • India

  • Latin America

    • Brazil

  • Middle East & Africa (MEA)