Europe’s BPO services drop 30% in Q1
LONDON, UNITED KINGDOM — First quarter demand for Business Process Outsourcing (BPO) services in Europe fell 30% to US$750 million year-on-year (YoY), said research and advisory firm Information Services Group (ISG).
In its latest EMEA ISG Index, ISG President Steve Hall said that more companies are becoming vigilant about spending.
“There continues to be more scrutiny on deal signings, especially in discretionary spending areas. Enterprises are revisiting cost optimization, efficiency gains, and vendor consolidation deals,” he added.
Still, the BPO segments that grew in the year’s first quarter include engineering, finance, accounting, and facilities management services.
Meanwhile, IT outsourcing (ITO) rose five per cent YoY to US$3.0 billion, with strength in application development and maintenance services boosting the segment with US$1.9 billion.
Overall, the annual contract value (ACV) of managed services in the European region reached US$3.7 billion in Q1 2023 with 292 contracts within the quarter.
