One-third of organisations plan to outsource more in the next two years as war for talent intensifies and client satisfaction with service providers reaches its highest score to date
2022 UK IT Sourcing Study results published
LONDON, May 20, 2022 /PRNewswire/ — The 2022 UK IT Sourcing Study, conducted by Whitelane Research in collaboration with PA Consulting, the consultancy that’s bringing ingenuity to life, investigates more than 660 unique IT sourcing relationships and more than 575 cloud sourcing relationships held by over 270 participants of the top IT spending organisations in the UK.
The findings reveal that for the first time in the UK study, cost reduction is no longer the number one driver for organisations planning to outsource more. Instead, they are outsourcing to focus on core business (57%) and gain access to resources/talent (56%). Research also found that 91% of participants rated their IT service provider(s) satisfactory and the average satisfaction has increased by one percentage point to 73%, the highest score to date.
Key findings from the 2022 study include:
- Two-thirds of organisations in the UK plan to outsource at the same rate or more in the next two years, with 32% confirming they will outsource more. 18% of survey respondents are planning to outsource less (one of the highest percentages in Europe), driven predominantly by the need to build and retain their own intellectual property to drive the business.
- The manufacturing and chemicals sector predicts most outsourcing, with one in two organisations planning to outsource more in the next two years (18% above the overall average for the UK). In contrast, the public sector intends to outsource below average (28%), although it is the only sector reducing its level of insourcing compared to last year, down by eight percentage points.
- Overall, respondents are satisfied with their IT service provider(s), with 91% of all 663 IT sourcing relationships rated satisfactory.
- TCS is the highest-ranked provider with 82%, followed by Fujitsu (81%). Atos tops the ranking for security with a score of 84%, while Computacenter achieves first place for sustainability with 78%.
- Clients consider transition and change management one of their weakest governance capabilities, with 29% responding that (very) significant improvements are required. 62% of survey respondents say that in-house capability is the principal challenge to deliver complex transitions.
- More than half of respondents (52%) predict that 50% or more of their application portfolio will be in the cloud in two years, with 86% moving to the public cloud to achieve more agility and scalability. One in two clients reveal that it is difficult to change cloud providers, while one in five would consider moving their cloud load to a European provider.
- Amazon Web Services (AWS) remains number one on the ranking for infrastructure cloud platforms with a score of 80%, with providers performing best on the security and compliance KPI with an 81% average. Microsoft Office 365 is number one again for software cloud with 81%, while providers score best on pricing transparency with 81%.
Manish Khandelwal, IT Transformation expert at PA Consulting, says: “The pandemic years have accelerated the pace of digital transformation across sectors, and organisations have no choice but to be agile, innovative and ingenious. Businesses are aggressively using opportunities presented by digital transformation to drive growth which is resulting in significant demand for technology services. The market has matured, and clients are focused more on value rather than costs.
“The outsourcing industry has used the pandemic years as an opportunity to transform its operating model and has emerged stronger. The war for talent has reached unprecedented levels and will only intensify in the short term, however the industry has the unique opportunity to drive global workforce transformation. As the world economy enters a potentially turbulent period, winners will be those that are able to meaningfully co-create with clients, help them reduce time to market and contribute to both the top line and the bottom line”
The UK study is part of Whitelane’s annual IT sourcing studies, which interviews sourcing executives (CIOs/CFOs or their direct reports) about their outsourcing plans and their opinions on service providers. The studies are conducted in 13 different European countries and provide a comprehensive overview of the IT outsourcing landscape in each country. The survey shows the main outsourcing trends, evaluates and ranks the main IT service providers based on a set of key performance indicators (KPIs), and analyses trends in outsourcing governance and the impact of new technologies.
For more information visit: www.paconsulting.com/insights/2022/uk-it-sourcing-study-2022/
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About Whitelane Research
An independent organisation uniquely focused on and dedicated to IT (out)sourcing research across Europe.
IT Sourcing Research Studies: Extensive IT outsourcing studies in different countries based on the opinion of CIOs of the largest IT spending organisations on their outsourcing plans and service providers.
End-User/Service Provider Events: The objective of our events is to exchange ideas between end-users and service providers about different outsourcing themes and how to achieve better (win-win) sourcing relationships.
Best Practices Groups for End-Users: A forum exclusively for corporate executives who use sourcing as a significant part of their business strategies, allowing them to confidentially share ideas and information about their sourcing relationships.
For more information please visit www.whitelane.com
SOURCE PA Consulting