The increasing popularity of IT service outsourcing has brought an increase in complexity and capabilities. The field has spent much of the previous decade innovating and developing more specialized offerings to match customer needs.
In particular, the explosive 27.5% CAGR of the Software as a Service (SaaS) business model has created far more demand for IT service outsourcing as more companies build decentralized, agile, and cost-effective digital businesses. As a result, in 2020, the entire global outsourcing market, including both B2B and B2C, was valued between $10-12 billion USD.
However, this combination of factors has made it more difficult than ever to fully understand the various types of outsourced IT services and which are appropriate for your needs. Below, we break down the 3 primary types with an eye on empowering you to make the best choice.
1. Traditional global Contact Center (CC) providers
When you think of outsourced support centers, you’re likely thinking about traditional CC providers. They are generally designed for low-cost and low-complexity B2C support.
Often, the providers themselves maintain contact centers in multiple low-cost geographies, allowing them to cover 24/7 support cost effectively. This setup also enables them to quickly scale up and down based on their customers’ needs.
The flip side, however, is that obtaining these low costs and quick scaling means these providers rely on hiring generalists and then upskilling them based on the specific requirements of the job. The result is they are generally only able to handle low technical complexity Level 1 (L1) queries.
Outside of their narrow support role, these traditional providers often provide consulting to support customer journey mapping and transformation. This can be useful in extracting more value out of high-volume transactions.
2. System Integrators (SIs)
This is a far more specialized category of providers focusing on supporting companies that are implementing and integrating technology products in client ecosystems. Their place on this list is due to the fact that they often provide technical support once they have completed a system integration.
This support, much like traditional providers, is generally based in multiple low-cost geographies to provide round-the-clock support at a low cost. One key difference is that they usually provide higher levels of technical expertise and are therefore able to handle L2 and L3 queries. Notably, that expertise is narrower, limited to IT, application, and related areas.
Despite these capabilities, however, SIs do not have the capabilities to handle large-scale 24/7 technical support operations or to provide analytics-led consulting support. These capabilities instead come from the final category.
3. Specialist technical service and support providers
For the most specialized and advanced cases, you have specialist technical service and support providers. These are far more niche companies focusing on blending high-level technological expertise with consumer experience skills and the ability to leverage both to drive business outcomes.
This comes in the form of delivering consulting-led transformations of technical support as well as off-the-shelf accelerators to drive KPIs around efficiency and client satisfaction. In other words, specialist technical support providers can go beyond providing a reactive service to acting as an integrated, proactive, and value-generating part of a business.
Due to their need for far more specialized skills, specialist technical support providers typically deliver from onshore or nearshore locations, which can sometimes result in higher costs and less ability to quickly scale up or down.
However, this is not true for all specialists. At Tek Experts, we are utilizing partnerships with specialized skilling companies to develop the capabilities of specialist technical support providers at offshore locations. This points to a potential future in which some specialist technical support providers will be able to combine the advanced capabilities of their niche with many of the cost, location, and flexibility benefits of CC and SI providers.
Understanding the future of IT outsourcing
Ultimately, technology and new business models are transforming this space and the previously well-defined niches within it. That’s why it’s more important than ever to have a deep understanding of where IT outsourcing is today and how the field is evolving. To get that better understanding, we recommend you read the latest Everest whitepaper on Emerging Trends and Provider Landscapes in Enterprise Technical Support.