Cost-cutting, GenAI propel contact center outsourcing: ISG
CONNECTICUT, UNITED STATES — Global enterprises are increasingly outsourcing contact center functions in a strategic move to enhance customer experience while cutting costs.
This trend is highlighted in the latest ISG Provider Lens report, which notes a decline in the annual contract value for business process outsourcing (BPO) from $1.2 billion in the first half of 2023 to $0.8 billion in 2024.
Despite this drop, the number of contracts has risen, indicating a shift towards more frequent but smaller agreements as companies adjust to post-pandemic market conditions.
Cloud and AI integration drive technological advancements
The rapid advancement of customer service technology, particularly through cloud computing and artificial intelligence (AI), is prompting companies to integrate their IT resources with those of BPO providers.
This shift is essential as businesses seek solutions that combine cutting-edge technology with workforce expertise and streamlined processes. The transition from traditional on-premises systems to cloud-based contact centers is accelerating, driven by the needs of remote employees and consumer demand for multi-channel digital engagement.
Generative AI revolutionizes customer service operations
Generative AI (GenAI) is becoming a key component in transforming contact center operations. The technology offers significant benefits, including reduced query handling times, higher first-call resolution rates, fewer errors, and improved satisfaction for both customers and employees.
Currently, GenAI is most commonly used in bots that assist agents, but companies are exploring more advanced applications such as customer self-service bots and real-time translation.
“Enterprises are keen to explore and invest in GenAI,” remarked Jan Erik Aase, partner and global leader at ISG Provider Lens Research. “It is raising their expectations for productivity and efficiency gains.”
Strategic consulting enhances AI implementation
As companies implement AI technologies, many are turning to strategic consulting services to optimize these tools and achieve significant returns on investment (ROI).
By employing transformation frameworks and maturity assessment tools, enterprises can enhance their contact center operations and align with industry best practices.
Industry leaders and emerging stars identified
The 2024 ISG Provider Lens report evaluates 32 providers across three categories: Digital Operations, Intelligent Agent Experience, and Intelligent CX (AI & Analytics).
Foundever, Genpact, HGS, Sutherland, Teleperformance, Transcom, and WNS are the leaders in all three categories.
Additionally, Firstsource, Hexaware, IGT Solutions, and Startek have been recognized as Rising Stars for their promising portfolios and high future potential.
In customer experience excellence, HCLTech has been named the global ISG CX Star Performer for 2024, achieving top scores in ISG’s Voice of the Customer survey.
