Frost & Sullivan: Asia Pacific to Drive Global Services Industry in 2013
KUALA LUMPUR, Malaysia, Jan. 29, 2013 /PRNewswire/ -- The global services industry looks to maintain strong growth momentum heading into 2013, with the Asia-Pacific market as a major driving force. Asia-Pacific continues to be preferred locations of choice with India, China, The Philippines, and Malaysia followed by Indonesia, Thailand and Vietnam.
In 2012, the complex and uncertain global economic conditions, persistent struggle in the Europe markets, combined with sluggish growth in the US due to impacted elections, and similarly tamed growth in developing markets (China, India and Brazil) affected the outsourcing industry as a whole.
The Asia-Pacific market outlook is prominently positive due to their domestic growth potential and with accelerated momentum they are likely to gain further from global outsourcing. However, Latin America is looked to benefit from the near-shore trend and is likely to come up as competitor to APAC destinations. With increasing focus on cost, rural sourcing is set to pick up with government interest.
According to Krishna Baidya, Industry Manager, ICT Practice APAC, Frost & Sullivan, "The large LATAM market is location-dependant and locations such as Brazil, Mexico, Chile, Colombia and Peru are likely to register outsourcing growth whereas destinations such as Guatemala, Costa Rica, Panama, Honduras are likely come up often while picking nearshore destination."
"Global services providers are likely to set or expand their presence in those markets to take advantage of the market sentiment," he added.
Changes in wage costs and shifts in currency in the volatile financial markets also affect location preference. Amid currency devaluation, Baltic States like Estonia and Latvia move up in the preferred destination list. Improving fundamentals and infrastructure has helped Egypt and United Arab Emirates (UAE) gain prominence.
Technology trends in cloud computing, mobility, social, big data and security will look to change the industry in 2013, with data security as the critical focus. The trends offer new growth opportunity, potential of better productivity and lead to the development of new innovative business models, which will address the stiffened market competition. There are also new opportunities for Business Process Outsourcing (BPO) as there is a fundamental shift in relationships between organizations and their customers, touch points and modes of communication.
Organisations will look to utilize a broad mix of service delivery options including shared services and cloud technology, with key emphasis on business value creation. Analytics capability will be a crucial component to future service revenue and to move up the value chain.
Organisations will also continue to leverage on outsourcing to optimize operations and gain productive returns. However, they are likely to work on cost-savings; prudent about outsourcing services and savvier in contract negotiation. Service providers will look to address such challenges and focus on relationship development with clients through enhanced value and quality service offerings.
Frost & Sullivan forecasts joint ventures; business outcome based pricing, revenue-sharing arrangements to become more commonplace in the near-term. Innovative pricing and engagement models, along with the evolution of the delivery model are also expected as competition in the market stiffens and pressure on profit margin rises. Business relationships between outsourcer stakeholders and organisations will be looked to develop into more efficient partnerships.
The overall growth within the global services industry is expected as nearshore forecast is poised for acceleration. Offshore outlook is predicted to maintain its strong position while onshore forecast will be a major driving factor with continued domestic market growth in the Emerging Nations.
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants.
Our "Growth Partnership" supports clients by addressing these opportunities and incorporating two key elements driving visionary innovation: The Integrated Value Proposition and The Partnership Infrastructure.
- The Integrated Value Proposition provides support to our clients throughout all phases of their journey to visionary innovation including: research, analysis, strategy, vision, innovation and implementation.
- The Partnership Infrastructure is entirely unique as it constructs the foundation upon which visionary innovation becomes possible. This includes our 360 degree research, comprehensive industry coverage, career best practices as well as our global footprint of more than 40 offices.
For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies?
Corporate Communications, Asia Pacific
Corporate Communications, Asia Pacific
SOURCE Frost & Sullivan
More by this Source
Demand for Upgrades and Support Services Lend Wing to US DoD Unmanned Aerial Systems Market
16 Apr, 2015, 16:57 BST
Frost & Sullivan Celebrates Malaysia's Best-In-Class Firms at the 2015 Excellence Awards
15 Apr, 2015, 08:47 BST
Get content for your website
Enhance your website's or blog's content with PR Newswire's customised real-time news feeds.
Contact PR Newswire
Send us an email at MarketingUK@prnewswire.co.uk or call us at +44 (0)20 7454 5382
Become a PR Newswire client
Request more information about PR Newswire products & services or call us at +44 (0)20 7454 5382