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Outsourcing ‘has become a mandate’ for recession-hit firms

Written by: Daryl James

Article Overview: Amid the recession, companies are increasingly using outsourcing to achieve specific cost-saving goals, the findings of a new survey suggest.

Outsourcing ‘has become a mandate’ for recession-hit firms

Amid the recession, companies are increasingly using outsourcing to achieve specific cost-saving goals, the findings of a new survey suggest.

According to EquaTerra’s 2Q09 Advisor and Business/IT Service Provider Pulse Survey, 65 percent of outsourcing service providers said they are experiencing continued growth in new deals.

Furthermore, 58 percent of respondents said the economic downturn has increased demand for outsourcing – the fourth quarter in a row that this figure has risen.

When polling its own client-facing advisors, EquaTerra found that the market for business process outsourcing and IT outsourcing continues to be strong, with 46 percent saying that demand remains steady.

Commenting on the results, Stan Lepeak of EquaTerra said that businesses are increasingly using outsourcing as a critical element in their strategy for weathering the recession.

"The fundamental motivation for outsourcing has always been cost savings," he explained. "Now, that aspiration has become a mandate, driving narrowly focused, low-risk deals with specific cost-saving targets."

A Reuters report recently suggested that outsourcing providers are likely to have growing opportunities to meet the needs of U.S. healthcare organizations, as companies in this sector are pressured to reduce costs.

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Article Tags: aspiration, business process outsourcing, critical element, economic downturn, equaterra, fourth quarter, fundamental motivation, healthcare organizations, mandate, new survey, outsourcing providers, recession, respondents, reuters report, rsquo, service provider, service providers, stan lepeak, targets, weathering



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