Outsourcing greatly affected but more relevant after COVID-19

The outsourcing sector has been greatly affected by COVID-19, and there is no immediate recovery in sight. However, when recovery begins, the bounce-back will be fast, and the outsourcing sector will be more relevant and popular than ever. Read more to understand why.

The main challenges for the sector

Outsourcing service providers around the world are dealing with travel restrictions for their staff. Empty offices are a result of this. Many SMEs in developing countries provide outsourcing services to companies in Europe. But, they do not have the equipment, infrastructure or management tools to let their staff work from home. They have almost no staff and are having great difficulties trying to deliver work.

With work not getting done, many outsourcing partners have to take the work back in-house. This may result in them stopping outsourcing their work altogether, even when the crisis is over. Even companies that can deliver have to deal with projects that are now on hold and the lack of new incoming projects.

There is good news

European companies are also facing the challenges of staff working from home. They are also dealing with processes they wished they had automated before most of their employees had to work from home. These circumstances will be the deciding factor for many European companies to open up towards digitisation and automation of their work processes. This will lower the threshold for outsourcing in the future. So, in the long run, European companies may be more likely to outsource their IT or business processes to other countries.

There is a lot of understanding among companies from all around the world. This is a crisis that affects us all. When deadlines are not met, and schedules have to be changed, most companies will understand and be flexible. The best advice is: keep communicating with your outsourcing partners. Be transparent about the status of the project and how you will try to deliver. Make sure your clients see that you are doing the best you can, and stay strong.


The quickest recovery is expected in strong European countries, like the countries in North- and Western Europe. But, it is also expected in the formerly more conservative countries and sectors. These are pretty much being forced to move toward IT-enabled work environments. We expect the fourth quarter of 2020 to show strong signs of recovery. Many projects may be able to resume their normal course if the companies are still standing.

That will be the biggest challenges of this crisis; staying in business until the first phase of this crisis is over. Once it is, there will be a bigger demand for outsourcing services. This is especially the case in the areas of security, digital working environments, cloud services and artificial intelligence.

Stay informed on the situation

Many online resources will help you to stay informed on the situation in the outsourcing sector.

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This news article was written for CBI by Globally Cool.

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