
Which trends offer opportunities or pose threats on the European outsourcing market?
The European outsourcing market is influenced by many different trends. General trends include the demand for cybersecurity, the rising use of artificial intelligence (AI) tools, sustainability and the increased interest of European SMEs in outsourcing. Other trends are also influencing the ways in which companies do business. Buyers are increasingly looking for strategic partners that can add value, be flexible, implement agile working methods and have access to skilled people.
Contents of this page
- The European outsourcing market is transforming
- Generative AI and Large Language Models
- Robotic Process Automation
- European buyers demand sustainable solutions
- Cybersecurity remains a top priority
- Strategic partnerships: Outsourcing providers as part of the buyer’s team
- Value over price
- Agile working
- Customisation and flexibility
- SMEs are increasingly open towards outsourcing
1. The European outsourcing market is transforming
The European outsourcing market is changing quickly, driven by new business needs, technology and buyer expectations. The shift from the current situation (from roughly one year ago) to what is expected in the near future is presented in Table 1. The table highlights key changes, including a shift from working with multiple suppliers to focusing on a single, preferred partner. It also indicates how technology (like generative AI) is becoming more important in outsourcing, as well as how businesses are placing more value on sustainability and agility.
In addition to changing how companies work with outsourcing providers, these changes are making outsourcing services more accessible to small and medium-sized enterprises (SMEs), thereby creating new opportunities in the market.
Table 1: Sector transformation
Current situation (from roughly a year ago) | Trend (in the near future) | |
Doing business |
|
|
How you run your company |
|
|
Your product or service |
|
|
Economics |
|
|
2. Generative AI and Large Language Models
Generative AI and large language models (LLMs) are a transformative trend in outsourcing. These technologies are the key to innovation, efficiency and automation. The use of these tools can help you improve productivity, reduce costs, drive innovation and gain a competitive advantage. As generative AI and LLMs continue to evolve, outsourcing providers must embrace this technology to stay ahead within the changing landscape of outsourcing.
Figure 1: Generative AI vs General AI

Source: Globally Cool
Large language models (LLMs) are the technology behind generative AI for text, and generative AI uses these models to produce creative, human-like language outputs in various applications.
The following are several ways in which you could benefit from these technologies:
- Improved productivity: Generative AI helps outsourcing providers automate repetitive or time-consuming tasks, making them more productive. This allows companies to focus on more important activities and complete projects faster.
- Cost savings: Generative AI can reduce costs by automating tasks that would otherwise require substantial time and effort. Outsourcing providers can offer cost-effective solutions by using AI algorithms to automate processes, improve workflows and avoid mistakes.
- Innovation and competitive advantage: Generative AI enables outsourcing companies to provide innovative and unique solutions to their clients. By using AI-generated insights and designs, providers can stand out in a competitive market and offer customised services.
- Scalability and flexibility: Generative AI allows outsourcing providers to scale their services and adapt to changing client needs. With AI, providers can handle larger workloads and respond quickly to new demands.
- Data-driven decision-making: The models can analyse large amounts of data, thereby helping providers to make decisions based on evidence. By using AI-generated insights, outsourcing providers can offer data-driven recommendations and solutions to their clients.
For contact centres, generative AI has additional benefits. It can be a strategic decision to deliver more personalised customer interactions, and it can drive innovative business strategies. Research by Support Zebra reveals that 75% of consumers find chatbots convenient for handling routine inquiries. This allows contact centre service providers to allow their human teams to focus on more difficult matters.
Tips:
- As with any new skill, learning to work with generative AI will require some investment of time and effort. In the long run, however, these investments are very likely to pay off.
- Appoint an AI productivity team within your company. This team can explore how the current AI tools could benefit your business.
- Learn to work with generative AI, for both your internal processes and your products. Given the speed of developments in AI, you should regularly check sources to find new ways of using generative AI for your business. Useful sources include articles on How to Use Generative AI in the BPO Sector and The Impact of Generative AI on the Tech Outsourcing Business. This document could also be helpful: 9 Tips to go Digital in the Outsourcing Sector.
- Read more about what AI can do for the outsourcing sector in this news item: Is AI the future of software development?.
3. Robotic Process Automation
Robotic process automation (RPA) is a rapidly growing and transformative trend in the European technology landscape. Using software robots, or ‘bots’, RPA handles routine and repetitive tasks that were once done manually. This technology can help outsourcing providers like you work faster, more accurately and at a lower cost.
Although RPA and AI are both tools for automation, they work differently. Whereas RPA follows clear, fixed rules to perform repetitive tasks (like copying data or processing invoices), AI is smarter, learning from data, recognising patterns and making decisions (like predicting trends or understanding text). Structured, repetitive work lends itself well to RPA, and more complex, flexible tasks are better suited to AI. These technologies can be combined to create powerful solutions that can perform tasks, in addition to thinking and improving over time.
The benefits of RPA are clear. It boosts efficiency by reducing the time and effort needed for standard tasks (like data entry, invoice processing and customer support). This gives human workers more time to focus on important activities (like strategy, innovation and solving complex problems).
European companies are increasingly asking for RPA, especially for tasks where speed and consistency matter most. Industries like finance, healthcare and logistics often use RPA to simplify processes, minimise errors and meet regulatory requirements.
In addition to the benefits outlined above, RPA supports the ongoing push for digital transformation. As European businesses look to modernise, they are relying on outsourcing providers to deliver RPA solutions that fit smoothly into their current systems. By offering RPA services, you can position your company as a forward-thinking partner that helps clients work more efficiently and achieve greater value.
Tips:
- Identify repetitive tasks in your clients’ processes and suggest RPA to improve speed and accuracy.
- Train your team in RPA tools and platforms to stay competitive..
4. European buyers demand sustainable solutions
Sustainability is a hot topic in Europe, including in the outsourcing sector. Once optional, it became a preferred quality, and it is now often a mandatory requirement.
There are two directions within sustainability: green sustainability and social sustainability. Green sustainability can be described as minimising harm to the environment and preserving resources for future generations through eco-friendly practices. Social sustainability has the goal of creating a fair, inclusive and equal society that meets the needs of all individuals. One term that is often used to describe both directions is Environmental Social Governance (ESG).
European companies are increasingly becoming intrinsically motivated to be more sustainable. One way to do this is by working with sustainable providers (this could be you). European governments are also pushing for sustainable solutions. In the EU, legislation is in place to ensure that sustainability is a legal requirement, and new regulations will be adopted soon.
Important Green Deal legislation has recently been approved (in spring 2024). This legislation includes the Corporate Sustainability Due Diligence Directive (CSDDD) and the Forced Labour Regulation (2024). EU member states will have two years to implement the regulations and administrative procedures to comply with this legal text.
This legislation requires larger companies (exact number to be found on the website of the European Commission) to identify and — where necessary — prevent, end or reduce any negative impacts of their activities on human rights and the environment. This applies to the company’s own operations, as well as throughout its value chains. This means that the new rules may apply to you indirectly, through your buyers.
The Forced Labour Regulation complements the CSDDD. It bans from the EU market any products that are made with forced labour.
Although these laws might not yet apply to you, it would be wise to familiarise yourself with them and be prepared for their implementation.
Experts in the outsourcing sector have also observed a trend in which buyers are actively supporting the efforts of providers to become more sustainable. For European buyers that have already made substantial progress towards becoming more sustainable, it can be hard to achieve full sustainability. For them, it might be easier to become more sustainable by helping their providers improve their sustainability.
An example of a social practise that benefits the well-being of employees is making sure your employees ‘clock off’ in time.
Figure 2: This small IT company in India has installed software that reminds the workers to ‘clock off’ in time
Source: YouTube
Tips:
- Write your own sustainability policy. It does not have to be perfect, and you do not need to have an answer to all sustainability issues within your company or the sector. The most important point is that many buyers appreciate the fact that a provider has a CSR policy. It indicates that you understand what it means and that you are motivated. Once a deal has been achieved, your buyer can help you improve your strategy.
- Read the documents on the CBI website concerning sustainability in the outsourcing sector: 7 tips on how to go green in the outsourcing sector, and 7 tips on how to become a socially responsible exporter in the outsourcing sector.
- For details on the Forced Labour Regulation, consult the Questions and Answers and the Factsheet on the website of the European Commission. Regularly check for updates to stay up to date on the proposed rollout of the new CSDDD and the Forced Labour Regulation.
5. Cybersecurity remains a top priority
As cyberthreats continue to increase, one of the most prominent trends in the outsourcing market is the growing demand for cybersecurity. Buyers are becoming increasingly aware of the potential cyberthreats. It is your job to make sure your products or services are secure. In line with this trend, the demand for managed security services is increasing.
Globally, 2023 saw the most data breaches ever, with an increase of 72% since 2021. Industry experts are convinced that this upward trend will continue in the next five years, and possibly even further. Cybersecurity has always been a concern for companies. Now that most businesses are using the cloud, they are much more easily exposed to data and privacy exploitation, at many levels.
As a result, European companies are increasingly turning to third-party providers for advanced cybersecurity solutions. This includes everything from managed security services to cloud-based security platforms, which can provide an additional layer of protection against malicious attacks.
European companies are increasingly hiring managed security service providers (MSSPs) to address growing cybersecurity threats. Evolving regulations (such as the GDPR) are requiring companies to maintain high levels of data protection, and MSSPs bring specialised knowledge to help ensure compliance. By providing round-the-clock monitoring and rapid response to cyber incidents, MSSPs offer a level of vigilance that many companies find challenging to maintain in-house.
Another benefit of hiring MSSPs is that it allows companies to scale their security operations without needing to recruit and retain their own cybersecurity talent, which is hard to find. By outsourcing to experts like you, businesses can focus on their core activities whilst being protected against the increasing number of cyber threats.
Table 2: Differences between MSP and MSSP
MSP | MSSP |
Primary focus on IT operations and performance | Primary focus on cybersecurity |
Provides administration, IT and some cybersecurity services | Provides 24/7 cybersecurity services |
Often partners with the client’s IT, Administration and Ops teams | Often partners with in-house security professionals |
Source: Globally Cool, inspired by Proactive-info.com
European companies are also becoming increasingly concerned about how their outsourcing partners (actual or potential) are handling cybersecurity and data compliance. This is especially the case, now that the GDPR and other regulations are enforcing strict data privacy requirements across the EU. Buyers expect partners to handle all personal and sensitive data in a compliant and secure manner, meeting legal requirements and protecting privacy.
For this reason, you should ensure that the products or services you deliver include good security practices. You can do this by (if applicable):
- Implementing secure coding practices
- Using a secure development environment
- Encrypting sensitive data
- Implementing strong authentication
- Regularly scanning for vulnerabilities
- Implementing security monitoring and logging
- Having a plan for incident response
- Educating employees about cybersecurity
- Having a backup and recovery plan
- Working with memory safe programming languages (see the section below)
One current cybersecurity trend is the development of memory safe programming languages. Traditional programming languages (like C and C++) provide high levels of performance, but they prioritise speed and efficiency over safety. This makes them susceptible to memory management vulnerabilities (such as buffer overflows and memory leaks), which are often used by attackers. As a result, European buyers are increasingly preferring to use memory safe languages, such as Rust, Go and Java.
Memory safe languages apply rules that prevent common memory-related errors during development. This reduces the likelihood of security vulnerabilities that can arise from improper memory handling.
By implementing privacy-focused solutions (such as data anonymisation, access controls and consent management) you can show buyers that you prioritise both security and data privacy. In addition to reducing regulatory risks, such compliance can build trust with clients who rely on you to protect their sensitive data.
Adopting memory safe languages can allow you to reduce risks at the code level. This can complement other security measures that you can take (like encryption and vulnerability scanning).
Tips:
- Communicate how seriously you take cybersecurity to your clients. Emphasise this in your marketing message. Do this in your general marketing (for example via your website, advertisements) and your personalised marketing, when you are sending proposals and in collaboration communication.
- Highlight your commitment to data compliance and privacy as well, thereby demonstrating that your services align with GDPR requirements and other relevant regulations. Emphasise these compliance measures in all communications with clients.
- Consider offering services concerning cybersecurity like managed security services, cloud-based security platforms or hiring out managed services providers.
6. Strategic partnerships: Outsourcing providers as part of the buyer’s team
The working relationship between buyers and providers of outsourcing services is changing. Buyers are looking for strategic partnerships. Outsourcing providers are increasingly perceived as part of the buyer’s team. A good relationship is therefore necessary. This is leading buyers to shift away from multiple supplies to one or a few preferred suppliers. In addition, some buyers are entering into relationships with outsourcing providers to make them their research and development partner.
From multiple suppliers to preferred suppliers
In the past 10 years, most European buyers had multiple outsourcing suppliers, even for the same or similar tasks. Their main reason for working with multiple suppliers was that they thought it would be more cost-efficient. This model is now changing. European buyers are currently looking to work with preferred suppliers. This practice is also referred to as strategic partnerships.
In recent years, European organisations have been increasingly relying on outsourcing to optimise their operations, reduce costs and access specialised skills. The COVID-19 pandemic dramatically changed the dynamics of the workplace, however, posing a challenge to traditional outsourcing models. When remote work became the norm and virtual collaboration tools facilitated seamless communication, the difference between in-house and outsourced employees became smaller. This provided an opportunity for buyers to re-evaluate their outsourcing strategies.
European companies are realising that it can be very beneficial to have a strong bond with their suppliers. It increases commitment and trust, making it easier to achieve desired project outcomes.
You would obviously like to be that preferred supplier or strategic partner. Being a preferred supplier does not mean that you must expand (diversify) your range of services. It might require you to be able to scale up to do more of the work that you are currently doing for a particular buyer.
In general, you become a preferred supplier when your buyer stops outsourcing small projects to several different suppliers, but instead chooses a single supplier (you) with whom they form a strong bond. Your working relationship will transform from one in which you do a few small, isolated projects into one in which you and the buyer cooperate more on larger projects.
Outsourcing providers as external research and development departments
Outsourcing partners are increasingly being seen and treated as external research and development (R&D) departments. This trend is due largely to the lack of available talent in many European countries.
New technical developments are creating possibilities for great progress, but it is hard to find the right people to work on them. Many European companies have tried to hire talent themselves, to research and develop new ideas for their businesses, but they have often been unsuccessful. For this reason, they are increasingly interested in outsourcing. Companies are looking for outsourcing partners to serve as their research and development departments and come up with innovative solutions.
Imagine a scenario in which a buyer has decided to partner with you. Your buyer operates in the healthcare industry and would like to develop an innovative telemedicine platform. The buyer lacks the in-house expertise and resources for extensive R&D in this field.
In this scenario, you are acting as an extended R&D department. You start by conducting a thorough market analysis, in which you assess current trends, competitor offerings and emerging technologies related to telemedicine. You also investigate regulatory requirements and user preferences. Based on what you have learned, you identify key opportunities and challenges relating to telemedicine. You then propose a range of innovative features and functionalities that could differentiate your buyer’s platform in the market.
Next, you start prototyping and testing various components of the telemedicine platform. You could develop proof-of-concept models, conduct usability studies and fine-tune the user experience.
Throughout this process, there are continuous collaboration and feedback loops between you and your buyer. These loops provide insight based on domain knowledge and specific requirements, and you provide technical expertise and creative solutions.
As the project progresses, you fine-tune the platform based on feedback and insight gained from testing. You ensure that the technology is scalable, secure and compliant with industry standards.
Ultimately, you deliver a telemedicine platform that not only meets your buyer’s initial vision, but that also incorporates innovative features that set it apart in the market. In this way, you have acted as a valuable R&D partner, using the buyer’s expertise to drive innovation and enhance your buyer’s competitive edge in the healthcare industry.
In this scenario, success requires a combination of technical expertise, industry knowledge and strong communication skills. Examples of such skills include:
Technical proficiency:
- Expertise in software development, including relevant programming languages, frameworks and technologies;
- Knowledge of technologies, protocols and best practices in telemedicine;
- Experience in developing platforms that are scalable, secure and compliant.
Innovation and creative problem-solving:
- Capacity for innovation;
- Creative problem-solving skills;
- Ability to translate technical concepts into understandable insights for the buyer, and the other way around;
- Openness to incorporating domain knowledge and specific requirements provided by the buyer into the development process.
Project management:
- Project management skills;
- Communication skills regarding project status, potential challenges and proposed solutions;
- Assurance processes to ensure the platform is compliant and that it meets the required standards.
Although this trend is relatively new in the outsourcing industry, experts predict that it will grow significantly within the next 10 years. This is mainly due to the significant talent shortage in Europe at the moment. No direct solution to this shortage is in sight, as it is expected to continue to grow.
Another reason that this trend is likely to grow has to do with the opportunities it offers for European companies. When they see their competitors are working with their outsourcing partners as research and development departments, they might decide to follow their example.
If you think your company has the potential to act as an outsourced research and development department for your buyers, consider steering your company in that direction. There are opportunities for both ITO and BPO providers.
Tips:
- Invest in the relationships you have with your buyers. Examples could include proactive engagement, actively seeking feedback and being a collaborative partner. Regularly ask buyers about their evolving needs and offer innovative ideas and solutions to help them stay ahead in their industry.
- Understand your buyer’s business. Take the time to understand each buyer’s business, industry and specific needs. Go beyond surface-level knowledge, and delve into their strategic goals, difficulties and market challenges. Once you understand a buyer’s operations, you will be able to customise your services and solutions to align with the goals of that buyer. This will demonstrate to buyers that you are committed to their success.
- Build trust by consistently delivering high-quality services and meet or exceed agreed-upon deadlines. Maintain open and transparent communication channels, provide regular updates of your progress and address any concerns quickly.
- European companies prefer suppliers who can scale up when needed. Have a plan ready in case you need to scale up and attract new talent. Present this plan to current or potential buyers to show that you are prepared. In addition, do not forget about the talent you already have. Invest in your people.
- If you are aiming to become a R&D department for your buyer, be sure to emphasise how you can contribute to the development of your buyer’s company in this way. Illustrate your vision with real-life examples of how outsourcing providers have contributed to the business success of their buyers by coming up with new business ideas or improvements.
7. Value over price
In the ITO and BPO industry, experts are seeing a shift towards prioritising value over price. Buyers expect higher levels of service and are increasingly seeking suppliers who can meet these new standards. As a result, the industry is witnessing a shakeout, in which companies that cannot meet these higher expectations face the prospect of losing their former buyers.
Another aspect of this trend is an increasing demand for niche talent. Buyers are looking for suppliers who can provide specialised expertise, industry-specific knowledge and innovative solutions customised to their unique business needs.
This change is in line with the trend in which generic outsourcing approaches are no longer sufficient to address complex challenges and achieve strategic objectives.
Figure 3: Prioritising value over price

Source: Globally Cool
Below is an example of how you can offer added value to your buyer.
Your buyer is an SME specialising in organic skincare products. The company has decided to outsource its e-commerce website development to you.
The SME provides you with a basic outline of requirements, including features like product listings, a secure checkout process and a simple customer account system.
Your added value is industry knowledge. Because of this knowledge, you are aware of the competitive nature of the skincare industry. You suggest additional features to add value to the project. You propose integrating a system for customer reviews and ratings, which would allow shoppers to provide feedback on products. In addition to building trust, this system would provide valuable insights for product improvement.
Your added value also consists of knowledge about e-commerce websites. Based on this knowledge, you could recommend incorporating a newsletter subscription feature to capture and nurture leads. This emphasises the importance of engaging customers beyond the initial purchase, potentially leading to repeat business.
You could even suggest integrating a chatbot for customer support, thereby enhancing the user experience and providing timely assistance to potential buyers.
The SME appreciates these suggestions and agrees to implement the additional features. As a result, the e-commerce website is able to facilitate smooth transactions whilst also providing a platform for customer interaction and relationship-building.
This example illustrates how an outsourcing provider can add value to SME projects by understanding the client’s industry, anticipating needs and proposing enhancements that go beyond the initial scope, ultimately contributing to the market success of the SME.
You will have a competitive advantage if you can offer:
- Access to niche talent pools;
- Good domain expertise;
- A demonstrated track record of success in specific areas;
- Customised solutions.
Tips:
- Emphasise quality. Do this in your marketing, as well as on your website.
- Regularly ask your buyers how you can improve on quality, and make your own suggestions for quality improvement.
- Add value to your product or service by offering customised solutions.
- Invest in your employees so that they can provide the desired quality.
8. Agile working
After years of working with the waterfall approach, most of the outsourcing sector has shifted to ‘agile working’, which essentially amounts to flexible working. Developments in IT are occurring at such a rapid pace that both buyers and providers of outsourcing solutions must be flexible.
In the outsourcing sector, agile working involves bringing together people, processes, connectivity, technology, time and place to find the best working method for a specific task. It emphasises working within the guidelines of the task, whilst allowing flexibility in how it is performed. It involves finding the most appropriate and effective approach, breaking free from rigid boundaries to adapt and optimise the work process. Agile working encourages collaboration, adaptability and leveraging technology to achieve desired outcomes.
The most recent trend in agile working is ‘T-shirt sizing’ — a combination of the agile and waterfall approaches. Its goal is to gain a better grip on agile working. The concepts of ‘grip’ and ‘agile’ could largely be regarded as opposite ends of a spectrum. The following question is an example of T-shirt sizing in outsourcing: ‘What are we going to develop today: small, medium, large or extra-large?’ Most agile teams make such estimates, as it helps teams to understand, discuss and plan what they are going to work on next.
Outsourcing providers who apply agile working methods approach projects in a way that allows for flexibility, collaboration and rapid adaptation to changing requirements. For example, suppose a client has outsourced the development of a software application to you. In an agile working environment, you would start by breaking down the project into smaller, manageable parts known as ‘sprints’. Each sprint typically lasts two to four weeks.
During the first sprint, you and your buyer work closely together to define the specific features and functionalities needed for the application. The buyer then prioritises these features based on current needs.
Your development team then focuses on building and testing the highest-priority features during the first sprint. At the end of the sprint, you demonstrate the working features to the client and ask for feedback.
Based on the buyer’s feedback, you make adjustments and improvements in the sprints that follow. This process creates room for continuous improvement and ensures that the final product will be closely aligned with the buyer’s vision.
Throughout the project, regular communication and collaboration between you and the buyer are essential. This might involve daily or weekly meetings to discuss progress, address any challenges and make decisions together.
Figure 4: A visualisation of Agile working

Source: Globally Cool
By adopting agile practices, you can deliver a product that is both technically sound and closely aligned with the buyer’s evolving needs and priorities. An additional benefit of this approach is that it helps build a strong and collaborative relationship between you and your buyer. This is also in line with the ‘preferred supplier’ trend.
DevOps in Agile Working
A complementary approach to agile working involves the integration of DevOps practices. This streamlines collaboration between development and operations teams. DevOps focuses on automating and optimising processes (such as code integration, testing and deployment), thereby ensuring faster and more reliable delivery. By combining the flexibility of Agile with DevOps’ emphasis on automation and continuous delivery, you can enhance efficiency and adapt quickly to changing requirements.
Tips:
- Make your company’s culture one of collaboration and communication. Encourage open collaboration and effective communication amongst team members. Emphasise the importance of sharing ideas, feedback and progress updates regularly. Promote a supportive environment in which everyone feels comfortable contributing their insights and perspectives. Agile working thrives on effective collaboration and communication to ensure alignment and quick decision-making.
- Empower cross-functional teams. Form cross-functional teams with members from different disciplines or departments. These teams should have skills and expertise relevant to the project or task at hand. By bringing together individuals with different perspectives, you can create innovation, creativity and efficient problem-solving. Encourage team members to work together, share knowledge and take ownership of their tasks.
- Embrace flexibility and adaptability. Promote a mindset that embraces change, flexibility and adaptability. Agile working acknowledges that requirements and priorities may evolve, and plans may need adjustments along the way. Encourage teams to be responsive to changes, identify opportunities for improvement and adapt their strategies accordingly. This flexibility will give you continuous improvement and will ensure that the company remains responsive to evolving market dynamics.
- Implement agile methodologies and practices (for example Scrum or Kanban), and implement related practices to support agile working. Break down projects into smaller, manageable tasks or sprints with clear objectives and timelines. Use visual management tools (like Kanban boards) to track progress and visualise work. Hold regular team meetings (such as daily stand-ups or sprint reviews) to foster transparency and ensure that everyone is aligned. You should also consider whether DevOps might be more suitable for your company. To make an informed decision, read articles about this subject (for example, DevOps vs Agile: Which one to choose in 2024).
- Keep learning and improving. Promote a culture of continuous learning and improvement within the organisation. Encourage teams to reflect on their work, identify areas for enhancement and implement changes to optimise performance. Provide opportunities for professional development and skill-building to support the growth of team members. Foster a safe environment where mistakes are seen as learning opportunities, encouraging experimentation and innovation.
9. Customisation and flexibility
Customisation and flexibility are important to European buyers, and they are often the reason they decide to outsource tasks instead of keeping them in house. The field of information technology is changing rapidly, with new technologies, methodologies and tools emerging on a regular basis. As a result, organisations need the flexibility to adapt to technological trends and incorporate customised solutions that are suited to their specific needs.
On-demand buying is a trend that corresponds to those of customisation and flexible contracts. An increasing number of current and potential European buyers of IT and business process outsourcing are looking to buy products or services on demand.
At first glance, this trend seems to be in conflict with the aforementioned trend of integrating providers as part of the team and choosing customisation and flexibility. In practice, however, both trends are important to European buyers.
On one hand, buyers are increasingly preferring to work closely with single suppliers, thereby building a strong, ‘one team’ partnership. This approach makes collaboration easier and creates a shared understanding that helps projects run smoothly. At the same time, however, buyers also need flexibility and customised solutions, especially as technology changes quickly. They expect even a single supplier to be adaptable, customising services to their specific needs rather than offering a standard approach. Even as buyers seek long-term partnerships with fewer suppliers, therefore, they also want those suppliers to be responsive and able to adjust to new demands.
As demonstrated by the trends outlined above, buyers are not choosing between integration and flexibility: they are expecting both. A provider who can be a trusted partner whilst staying adaptable and responsive will therefore have a strong advantage in the European market.
Tips:
- If you offer products or services focused on achieving specific business objectives and measurable results, consider working with outcome and value contracts. This will make you more innovative, accountable and aligned with the strategic goals of your buyers. This will lead to a stronger partnership and greater value, but it also requires careful planning, monitoring and collaboration to ensure success.
- Customise your services to meet the specific requirements of each buyer. Avoid a one-size-fits-all approach, and demonstrate your flexibility in adapting to their unique needs. Be receptive to feedback and willing to make necessary adjustments to optimise processes, workflows and deliverables. The ability to provide customised solutions demonstrates your commitment to the buyer’s success and reinforces your value as a preferred supplier.
10. SMEs are increasingly open towards outsourcing
In the European market, the outsourcing of IT and business processes has long been a practice used primarily by larger companies. For SMEs from emerging countries, however, larger companies are relatively difficult to target, thus making it harder for them to enter the European market.
There is good news: European SMEs are increasingly open to outsourcing. This is because they are increasingly realising that outsourcing offers significant benefits, including for smaller companies. In particular, small companies are less likely to have experienced employees, and outsourcing enables them to access the best talent.
According to a survey conducted by Clutch in 2022, 83% of all small US businesses reported that they would maintain or increase their spending on outsourced business processes in 2023. Industry experts consider these figures equally representative of the European market.
This outsourcing trend will make the demand for IT and business process outsourcing grow, and it will make the European market more accessible to SMEs from emerging economies.
Tips:
- Highlight the benefits of outsourcing in your promotional materials, and particularly on your website. You can use examples from other SMEs that have benefited from your outsourcing services.
- Read this Clutch document that highlights 7 Benefits of Outsourcing for Small Businesses to find ideas on how your company could provide such benefits for current or potential buyers.
- Consider profiling yourself as a company that can offer flexible services and that can be scaled to fit the unique needs and budgets of smaller companies. You can do this by offering personalised solutions.
- Read more about how to find buyers (including SMEs) in our study: 10 Tips for Finding Buyers on the European Outsourcing Market.
Globally Cool B.V. carried out this study in partnership with Laszlo Klucs on behalf of CBI.
Please review our market information disclaimer.
Search
Enter search terms to find market research