The business process outsourcing market in the Asia-Pacific region has more room to grow, according to a new study by Gartner.
In a statement yesterday, the analyst company said with the exception of Australia and New Zealand, the Asia-Pacific BPO market is still underdeveloped compared with the rest of the region.
Gartner research director T.J. Singh said this presents opportunities for BPO service providers, of which none have a clear lead in providing business functions such as customer management, HR operations, industry-specific processes like mortgage processing and supply chain management.
However, while enterprises are turning to BPO service providers to improve service levels and streamline workflow across the region, Gartner said few BPO providers have regional BPO capabilities for multiple processes.
Singh said: “The BPO service market in Asia Pacific, excluding Japan, consists of a wide range of local, regional and multinational (including India-based) service providers. Although the market is dominated by global and India-based service providers, there are also a number of fast-growing regional and niche BPO service providers”.
The fastest-growing BPO markets within Asia Pacific will be led by China and India. Industries such as banking and financial services, communications, government, technology, retail, and transportation will remain the largest consumers of BPO services.
As the BPO industry grows in the region, it is also likely to experience higher wage inflation and attrition, as demand for talent in the domestic market competes with offshore demand from the U.S. and Europe, Gartner said.
By 2016, the Asia Pacific BPO market is expected to reach US$9.5 billion, up from US$5.9 billion in 2011.
The largest BPO market last year was Australia, with a market size of more than US$4.63 billion. India, the region’s second largest market, raked in US$1.26 billion.
