Outsourcing contracts awarded, extended, and implemented in the first quarter of the year 2010 have witnessed a rise. As per industry analysts and leading financial firms, only slightly more than a third of the outsourcing service providers have managed to meet buyer objectives satisfactorily.
Turbulent worldwide economies and the pressure to stretch performance despite reduced resources made an impact on the global outsourcing sector as well. The most visible impact was in the rise in the number of outsourcing deals to 301 in Q1’09 from about 250 in Q4’08.
The continuing economic turmoil and frozen credit markets affected the volume of M&A activity was lower during the first quarter of 2009, as compared to the year ago period, as it. The situation was further complicated as government intervention in the markets increased because of the bailout programs.
The fundamental drivers for offshoring are the same as they have been for the past decade, but the challenges and the risk of making decisions that result in suboptimal outcomes have changed.