NelsonHall BPO Index Identifies 118% Growth in BPO TCV in 12 Months to March 2008
Leading BPO Analyst Firm Issues Quarterly Update on Development of BPO Market
| Source: NelsonHall
BOSTON, MA and LONDON and KOLN, GERMANY and PARIS--(Marketwire - April 14, 2008) -
NelsonHall, the leading BPO analyst firm, announced the results of its "BPO
Index" market monitor for the period ending March 2008. NelsonHall's BPO
Index shows that the BPO market is prospering with year-on-year TCV (total
contract value) growth of 118% and that the leading indicators for BPO in
2008 remain strong.
The defense sector is becoming an increasing source of "white-collar" BPO
and two U.S. military contracts worth a combined total of $17.4Bn made a
major contribution to BPO TCV growth over the past 12 months. Removing
these contracts to show the underlying level of BPO TCV growth in the
commercial sector and civil government agencies gives year-on-year global
BPO TCV growth of 20%. Europe recorded particularly strong performance with
year-on-year BPO TCV growth of 30%.
Front-office and middle-office (industry-specific) BPO continued to
strengthen over the past twelve months at the expense of back-office BPO,
with front-office and middle-office BPO now accounting for 82% of BPO TCV
compared to 56% for the 12 months ending March 2007. This reflects both the
absolute increase in activity in customer management service and
industry-specific BPO activity, particularly in the government and
financial services sectors, and the decline in back-office BPO.
While the level of F&A outsourcing contract activity continues to grow and
Capgemini's contract with Unilever to support its Latin American businesses
further validates the outsourcing of finance and accounting shared service
centers, major multi-process HR outsourcing have been notable by their
absence for the past three quarters with a number of contract negotiations
failing to come to fruition. Indeed the principal HR outsourcing activity
in Q1 2008 was the continuing build of specialist single service line
capability in support of talent management functions. For example, Kenexa
acquired Quorum International to strengthen its recruitment process
outsourcing capability in Europe, while Manpower acquired CRI and Vitae.
Hewitt focused on extending the global reach of its compensation consulting
capability through the acquisitions of New Bridge Street Consultants and
CSi.
At the same time, there were signs in Q1 2008 of the anticipated increase
in mortgage processing BPO activity. IBM was awarded a mortgage services
processing contract by Coastal Federal Credit Union, while Zenta also
expanded its mortgage processing services capabilities in the U.S.
NelsonHall's quarterly BPO Index reports are available as part of
NelsonHall's BPO subscription services. For more information about
accessing this report and NelsonHall's BPO subject matter experts, please
contact the following NelsonHall representatives:
Tony West at tony.west@nelson-hall.com, or call 617-520 6699
Rob Hughes at rob.hughes@nelson-hall.com, or call +44 (0) 870-770-5967
Paul Connolly at paul.connolly@nelson-hall.com, or call +44 (0)
870-770-5967.
About NelsonHall
Founded in 1998, NelsonHall is the leading global independent analyst firm
in Business Process Outsourcing (BPO). The company provides buy-side and
sell-side organizations with deeper research and analyses in major BPO
disciplines than any other research firm in the world. These include
Finance and Accounting, Human Resources, Procurement, Banking, Insurance,
Government and Customer Management Services. The company's
subscription-based model provides subscribers with robust market analyses,
case studies, vendor assessments, contract analyses, market reports and
access to a content-rich BPO contracts database. The firm covers a wide
range of industries, including financial services, government and utilities
sectors, and tracks worldwide and regional BPO activity. For more
information on NelsonHall, please visit www.nelson-hall.com.