Frost & Sullivan - Global Shared Services And Offshoring

Companies worldwide have been using Shared Services and Outsourcing to cut down on costs and streamline their processes in an effort to improve overall business and strengthen their market position.

MNCs across industry verticals are not just continuing but increasing their SSO efforts. Frost & Sullivan has estimated the SSO market for 2006 at approximately US$ 930 billion and projected to grow to US$ 1,430 billion by 2009, growing at a CAGR of 15%. Offshoring, which constituted a miniscule part of the total pie, is expected to grow at double the rate for overall SSO.

The key drivers for SSO have continued to be cost benefits through standardization, leveraging of scale benefits, and cost arbitrage in countries like India and China. Other benefits include ability to free up of precious management time to allow them to focus on core competencies; ability to drive business innovation even in non-core areas; and reap benefits from standardization and resulting efficiencies.

These factors have forced large corporations to explore further expansion of their current SSO operations or setting up new centers. On the other hand, concerns with SSO such as threat of loss of control and compromising confidentiality; potential reduction in service quality levels; risk of breach of intellectual property and shortage of skilled people through high attrition resulting in escalating costs, have forced some companies to reconsider against ramping up their SSO operations. Restrictive government regulations and political backlash in “send” countries have also forced some companies to adopt a more cautionary approach towards SSO.

The Global Shared Services And Offshoring Summit focuses on the upcoming Shared Services and Outsourcing (SSO) trend of verticalization. The 2-day event will provide a unique blend of perspectives on the current and future state of the SSO landscape including key drivers and constraints, spending trends, location selection criteria and top of the mind locations for industries.