MANILA, August 21st, 2017 — The total outsourcing services spending in the Philippines is expected to exceed US$500 million by 2021, according to the latest forecast from the IDC APeJ Semiannual Services Tracker. Enterprises’ Digital Transformation (DX) initiatives, as well as changing patterns of IT procurement and rapidly evolving service delivery models, will drive the Philippines outsourcing market to continue growing. 

Digitalization has created opportunities for new areas of business and organizational structures. However, as companies increasingly embark on a DX journey, outsourcing has been a way for them to address business challenges, such as growing complexity of ICT, lack of ICT budget, and the need for proper governance. 


“The Philippines outsourcing market is undergoing a dramatic transformation propelled by the increasing adoption of disruptive technologies. CIOs and technology leaders tap external capabilities to support their DX initiatives, meet ever-changing customer demands, implement solutions faster, and reduce cost,” said Alon Anthony Rejano, Market Analyst for Services, IDC Philippines. “In the age of greater automation, standardization, and modernization, external providers need to keep up and redefine their value proposition, offering new delivery and consumption models,” he added.


However, multi-year and multimillion-peso outsourcing deals are decreasing as end users look at cost cutting and show the inclination toward the cloud. This, in turn, is adding price pressure on providers, which drives vendor consolidation. IDC recommends that end users must understand where each outsourcing deal fits on the sourcing spectrum so that appropriate governance mechanisms can be created and managed.

“The outsourcing market will remain a tough market for competition in the coming years. Local customers want to see the vision and a strong offering, and while they want a partner for the long term, they are also willing to consider new partners that offer innovation,” Rejano added. “Providers need to demonstrate thought leadership throughout the lifetime of the contract and provide high-quality service to help transform customers with DX agenda.”

For further information on this report, please contact Alon Anthony Rejanoarejano@idc.com. For media inquiries, please contact RushanthineVelayutham rvelayutham_ext@idc.com or Trista Efendi tefendi@idc.com

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC’s analysis and insight help IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world\’s leading technology media, research, and events company. To learn more about IDC, please visit http://www.idc.com. Follow IDC on Twitter at @IDC

For inquiries, please contact:

Alon Anthony Rejano
Market Analyst for Services
IDC Philippines
+632 862 9729
arejano@idc.com


Rushanthine Velayutham
Corporate Communications Executive
IDC ASEAN
+603 7663 2204
rvelayutham_ext@idc.com

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