A new year, a new story to be written. 2020 took all of us by surprise, serving unexpected challenges to the world and forcing companies to keep afloat.
In 2021 change remains (still) the name of the game. So, what a better reason to ask you: did you integrate outsourcing software development on your business plan for this year? What’s your strategy for adopting new technologies? Do you have enough in-house resources to turn your goals into actions?
I bet you’ve already taken into account important shifts in your business’s core and regarding the technology you use to cope better with the “new reality.”
That’s why I’ve decided to come to you with additional support. So, I took a closer look on the market trends with a special concern for outsourcing software development services.
Hit the scroll to see what I’ve discovered!
First thing first: what stats say about outsourcing software development services in 2021?
- A significant increase in outsourced IT services companies revenues is announced – $413.72 billion by the end of 2021 (Statista);
- IT outsourcing market is expected to grow by about 5% each year in the years 2020–2024 (Global Industry Analytics report);
- The global outsourcing industry is predicted to reach $332.4 billion by 2025 (Grand View Research);
- The PaaS, SaaS, and IaaS markets grow by 24% annually. The global cloud computing market size is forecast to grow by US$190.32 billion until 2023 (Technavio);
- The talent shortage (including tech talent) is predicted to reach 85.2 million unfilled jobs – because there aren’t enough skilled people to take them – by 2030 (Korn Ferry report).
14 Key Outsourcing Software Development Trends in 2021:
- The new tech trends and employee shortages generate an overwhelming environment for industries, companies and entrepreneurs. This trend is experienced even by big corporations but not being able to keep up with the pace anymore.
- The role of outsourcing services providers is shifting from execution to partnership. As the importance of adopting new technologies has increased significantly, outsourcing services’ role has been redefined. Starting from 2021 it is expected for outsourcing dev providers to cover extended services like consultancy, research, and development, data analysis, technical analysis, etc.
- More independence in the technical process, more control over the projects’ delivery. The obvious trend of roles and skills diversity from the dedicated development teams makes room for keeping the client less involved in the technical process and allowing providers to control the projects’ delivery.
- Low skilled jobs lose ground to automation. To increase efficiency in costs and projects’ delivery time, outsourcing companies will invest more in robotic automation in 2021 and 2022. As automation takes over redundant and repetitive tasks, the staff must shift their attention to getting more specialized knowledge.
- Less focus on costs, more focus on product quality. Though money remains a sensitive topic due to the pandemic impact, now the key factor in outsourcing is more about enhanced security, customer experience, and business expansion.
- Cost cuts are not the answer. It’s more about getting cost-effective solutions. The companies become more aware of the real need to invest in cost-effective solutions. One of their top choices to minimize expenses: cloud storage.
- Hybrid workplace becomes a reality. And so are the dedicated digital solutions. Global Workplace Analytics: 2021 should see at least 25-30% of the global workforce working from home multiple days a week. In other words, in 2021 the companies have to keep their focus on providing a mixed digital ecosystem to their employees (project management, task management, security, communication solution, etc.). For achieving good results, companies might need to consider outsourcing.
- All eyes on cybersecurity. The greater the companies’ interest to migrate online is, the higher the cybersecurity risks become. Not only customers and entrepreneurs are interested in online market evolution. Black hat hackers pay great attention to it and try to find new and unexpected ways to get into the companies’ systems. That’s why the multi-level security approaches become mandatory to eradicate cybersecurity risks.
- AI and IoT get on the high-prio list. Great focus on solutions that allow replacing human interaction for: providing customers with guidance (by using AI) and for providing fast access to relevant data – statistics – and tools to personalize the communication & interactions (by using IoT)
- Native app development – most wanted by companies and users. The more users and companies look for remote and device-friendly apps to solve their daily problems, the greater the demand for native applications becomes. This trend is not exactly surprising, considering the advantages of native applications over web and hybrid ones: faster, more efficient, built-in functions, great focus on the user experience, use of modern languages (Swift, Kotlin), etc.
- Some languages become more preferred than others. When it comes to app development languages, specialists point to the trio Kotlin-Java-Scala and to Python, TypeScript, and Flutter.
- Higher interest in outsourcing development services, greater incomes for the IT companies. The global outsourcing industry is predicted to reach $332.4 billion by 2025 (Grand View Research).
- Eastern Europe is preferred for outsourcing. 70% of the global demand for software outsourcing comes from the United States and Western Europe. Surprisingly (or not), when it comes to choosing a reliable outsourcing provider, Eastern European companies are highly preferred.
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Why is the outsourcing market growing in 2021?
- the new economic environment forces companies to rethink their spendings;
- employees feel more engaged in their jobs with workplace flexibility;
- easier access to global talent pool – a WIN – WIN – WIN situation: for client, company, and employee;
- less logistic costs (e.g., according to research done by PGi, the average business with full-time telecommuters saves $10,000 per employee per year in real estate costs);
- great way to compensate for the lack of internal resources and know-how;
- real opportunity to increase business flexibility;
- no need to invest in long processes of creating internal structures.
*For providing accurate and relevant information, this article is based on multiple sources (Statista, Global Industry Analytics, Grand, Technavio, Korn Ferry, Clutch, etc.)
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