Cost benefits, business transformation and reengineering activities have underlined the remarkable growth of global shared services and outsourcing (SSO) over the past decade. The need to focus on core business activities to remain competitive has propelled global companies to rapidly develop SSO operations.
The Frost & Sullivan study on Global SSO Hub Potential Analysis surveyed more than 300 of the Global Fortune 500 companies across seven verticals to understand the factors influencing their SSO decisions.
According to estimates in the Frost & Sullivan study, the global SSO market was worth $758.1 billion in 2005 and will register a steady compound annual growth rate (CAGR) of 12 percent from 2004 to 2007. While onshore SSO currently contributes to over 90 percent of total SSO spending, growth rates for offshoring are expected to rapidly accelerate and achieve an impressive CAGR of 30 percent from 2004 to 2007.
Reflecting the intensifying vertical focus of the SSO industry, the Frost & Sullivan study established the finance vertical to be the biggest spender, with the energy vertical expected to register the highest growth in SSO spends globally from 2004 to 2007.
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