Will the outsourcing market grow or shrink in 2020?

Share on linkedin
Share on twitter
Share on facebook
Share on xing

As 2019 wrapped up, we had a couple of different client conversations that were, admittedly, all over the map. Some clients were excited for another year of outsourced sales and lead generation work, and some were reluctant. This does happen every year and people’s attitudes change based on the needs of their business, any “pivots,” and the cost structure they think they can take on — but it feels a bit different this year. There are concerns about a global 2020 recession, for one, and the U.S. has a big Presidential election later in 2020 that could shift that economy. Plus: in the UK, the Conservatives got a big victory in December 2019 and now it looks like Brexit could be full steam ahead. Things are changing, for sure. What does that mean for outsourcing as a function?

A couple of different inputs

The global outsourcing market varies size-wise by different studies, but it’s somewhere around $100 billion, if not more. Most are expecting it to grow, which actually makes sense in a global recession or slow-down: Why wouldn’t you outsource non-business critical functions, and even some business-critical ones, like business development and sales? Hiring full-time is a costly risk if done poorly. Outsourcing allows you to save money, and saving money are most executives’ two favorite words. 

This list of emergent job skills for 2020 is U.S.-based, but LinkedIn also did a “hot job skills” list for the European market. In both cases, you find the stuff you’d expect at the top — AI expert, etc. — but there are a lot of roles around the SDR/BDR/customer success space. It’s perceived there is a “skills gap” in those areas; we’ve mentioned this before, but many hiring managers and recruiters think BDR and SDR roles are the hardest to hire for. Don’t gamble if you view these skills as “hot” or “critical.” Invest in people who already have those skills and are willing to help your business without needing a full salary + benefits structure.

Now, there is a group of people out in the digital ether who think outsourcing is dead, using the argument that “cloud killed it.” That argument is more geared towards HR and accounting functionalities, i.e. why hire someone to run payroll if there’s a cloud-based SaaS that can do it for you? I think we all kind of realize that most executives would love to fully outsource HR, and we may see that within the next 15 years. That is not considered a “revenue-add” department by many, and thus it will be gone. Biz dev and sales functions? That’s a different discussion. Execs desperately need those functions to perform well, so they will spend for expertise — and when you hire in-house, you are not always guaranteed expertise.

TOP 300 COMPANIES IN DACH

Get Instant Access To The List Of The 300 Largest Enterprises In Germany, Austria, Switzerland.

Who runs the world?

Beyonce says “girls,” and that’s true to an extent. In reality, the world is run by cost-cutters. So long as the tech stack enables communication across different locales and teams, and so long as executives can save some money on outsourcing functions, outsourcing will continue to grow. Nothing that’s a potential cost savings to stakeholders and decision-makers will ever “be dead.” That’s not how business works.

Like this article?

Share on linkedin
Share on twitter
Share on facebook
Share on xing

Recent Articles

Lead Generation & Sales in DACH