More Than 75% of All Outsourced Projects in the United Kingdom Are Mobile, Research Says

May 24, 2012 - PRLog -- IT Sourcing Europe, a UK-based market intelligence company, has recently published its 3d Annual UK IT Outsourcing (ITO) Intelligence Report 2012, based on the results of the UK ITO vs In-House Software Development Survey.  This year the survey sample was comprised of 801 UK companies, of which 416 were IT / software development outsourcing companies and 385 – companies developing their IT solutions in-house.

According to the research findings, this year the highest demand for the outsourced IT / software development services comes from b2b focused IT / software companies (almost 65%), financial services companies (nearly 20%), b2c focused IT / software companies (around 15%) and mobile development companies (15%).

Regarding the major factors driving corporate decisions to outsource software development in the United Kingdom, in 2012 they are:

•   Reduction of operating expenses (reported by 70% of companies, which is up 5% from 2011),

•   Focus on core competences (reported by 50% of respondents, which is up almost 20% from 2011), and

•   Freeing in-house IT resources for other business critical purposes (reported by 40% of participants, which is up 17% from last year)

As the research shows, the top three challenges facing outsourcing companies in the United Kingdom in 2012 are:

•   Poor communication with their ITO service providers (reported by over 65% of respondents, which is almost double the response rate of 2011),

•   Change management (reported by almost 35% of survey participants, which is up 10% from 2011), and

•   Poor project management on vendor’s side (reported by almost 35% of those polled, which is up around 13% from last year)

In 2011, the Number One challenge was poor quality of delivered software products.
Other interesting research findings include:

•   More than 35% of the UK businesses outsource their IT / software development nearshore (to Central and Eastern Europe), while 22% of companies outsource offshore (to South Asia and Asia Pacific),

•   The volume of mobile development outsourcing has skyrocketed in 2012, with 76% of all UK companies polled reporting to outsource their mobile computing solutions,

•   The volume of Cloud-sourcing projects has increased by almost 10% this year, compared to 2011,

•   Fifty-five percent of the UK companies multisource their solutions, i.e. work pretty much in a distributed environment

Regarding the ITO business models used, more than 55% of companies polled admit having own software development setups, while cumulative 45% of companies engage with their service providers via “traditional” dedicated development center and fixed-price / time-and-material projects’ models.

According to IT Sourcing Europe’s research results, the majority of the UK outsourcing companies (almost 45%) pay up to 25% of overheads and 40% of outsourcers manage to save 10% to 24% of operating costs via their ITO engagements.

The findings of the survey of non-outsourcing companies suggest that the future outsourcing decisions in the United Kingdom will be driven by:

•   Slow time-to-market (reported by over 65% of companies),
•   High cost of domestic IT resources (reported by over 55% of companies), and
•   Scarce local IT Talent pool (reported by almost 35% of respondents)

More survey results are available at http://www.blog.ciklum.com/2012/05/more-than-75-of-all-ou....