BPO Trends and Predictions: Staying Ahead in a Rapidly Changing Industry

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Written by Dion Jay Tality


Global business process outsourcing (BPO) has become a viable solution for achieving growth and success. But to maximize the strategy’s full potential, companies should keep up with the latest trends in the industry. That is one way to stay ahead of the curve in a fast-paced business landscape.

Wondering what the current and future trends in the outsourcing industry are?

This page shares the top BPO trends and predictions to help you make informed outsourcing decisions. Read below.

BPO Overview: Its Significance and Market Changes

BPO Overview_ Its Significance and Market Changes

Let us begin by asking: What is BPO? BPO involves subcontracting non-core business processes to a third-party service provider instead of handling them in-house.

Companies of all sizes have various reasons for employing outsourcing. BPO for small businesses and startups allows farming out of secondary activities to service providers so that these businesses can focus on their core competencies. Big companies also outsource certain functions to reduce labor and operating costs.

Over the years, BPO has experienced significant market changes. What started as a business strategy in the manufacturing sector has expanded to cover almost all industries, from e-commerce to healthcare. In addition to handling front-office (customer-facing) functions, BPO firms now offer back-end operations. Even call centers have transitioned to contact centers.

Learn about the factors influencing the BPO industry below.

Key Factors Driving BPO Market Changes

Technology, consumers, and business demands significantly drive BPO trends and predictions. Let us delve into the factors that are changing the BPO market:

  • Advancing Technology. The use of technology has become such a game-changer in business. Deloitte cites the top digital enablers as automation, single-instance enterprise resource planning (ERP), case service management, and cloud computing. The rise of artificial intelligence (AI) has also shown much potential amid recent controversies.
  • Evolving Consumer Demands. Customers today have higher expectations than ever before, according to 93% of service teams surveyed by Hubspot. The rise of the internet and social media has made consumers more informed and empowered. They now demand personalized, on-demand service and an excellent customer experience.
  • Tight Market Competition. The BPO market has become highly competitive, with providers offering different outsourcing services. Key players and emerging providers can offer as much value depending on your needs. For businesses seeking to outsource, this means finding a BPO partner to suit their niche, size, budget, and needs is easier.
  • Changing Business Landscape. The business landscape changes due to several factors, such as world events. Let us take the COVID-19 pandemic as a perfect example. The pandemic led to the rise of remote work, which further supports digitalization. 

Six BPO Market Trends and Predictions

BPO Market Trends and Predictions

The BPO industry has been constantly evolving and expanding. The global BPO market size can grow from $292.3 billion in 2022 to $477.7 billion by 2030 at an expected compound annual growth rate (CAGR) of 6.3% during the forecast period

As such, businesses looking to outsource should stay updated with the latest market trends and predictions. That allows them to make informed outsourcing decisions and partner with the right BPO service providers.

Let us explore the current and future trends of the BPO market below.

1. Digital Transformation: Harnessing the Power of Technology

Digital transformation is one of the BPO trends and predictions triggered by the pandemic. According to McKinsey, the COVID-19 crisis accelerated this shift in business. Many companies have adopted the latest digital tools and technologies to gain a competitive advantage. Some businesses outsource to BPO firms to leverage the following:

  • Automation. Robotic process automation (RPA) is a game-changer for the BPO industry. This technology automates various tasks, helping reduce manual work and accelerate business processes.
  • AI. This technology simulates intelligence in machines, allowing them to work like humans. A chatbot is a perfect example of AI used for customer service; it assists customers with simple inquiries.
  • Cloud Computing. This application delivers services by accessing software, databases, servers, and networks via the Internet. BPO companies use contact center as a service (CCaaS) technology for their customer service operation to enhance the buyer’s experience.

2. Omnichannel Solutions: Enhancing the Customer Interactions

Omnichannel is more than just providing customer support via multiple channels. It is about offering them a seamless and consistent experience across all channels. It is one of the BPO trends and predictions most BPO firms adopt.

According to Hiver’s 2021 report, 60% of service teams provide customer support via three or more communication channels. Many businesses hire BPO providers to offer this capability. Below are the percentages of respondents using different channels:

  • Phone Service (83%). The phone is still the most preferred channel for communication. BPO firms use computer telephony integration (CTI) for their call centers handling customer service, sales, and tech support.
  • Email Support (77%). Email remains useful for business and marketing. Aside from phone services, BPO companies offer email and chat support to assist their clients’ customers.
  • Live Chat (42%). Due to speed and convenience, real-time chat has become increasingly popular for customer service. BPO providers employ and train agents to respond to customers via online chat platforms.
  • Social Media Management (31%). Social media has become essential for business as people live and breathe on Facebook, Instagram, Twitter, YouTube, and TikTok. BPO firms leverage these channels to interact with customers and support them.
  • Self-service Portals (25%). Self-service portals provide resources and allow customers to solve problems independently. Examples of these used in the BPO industry are interactive voice response (IVR), AI-powered chatbots, and knowledge base centers.

3. XCaaS: Providing the Best Customer Experience

Experience communication as a service (XCaaS) solutions has gradually penetrated the BPO industry. But for the uninitiated, this software technology is a cloud-based communication deployment model that combines both:

  • Unified Communications as a Service (UCaaS). This platform is used mainly for internal communication. Employees access video calls, voice tools, chat applications, cloud-hosted emails, and other collaboration tools to conduct business with each other.
  • CCaaS. This software is a cloud-based, provider-hosted technology used for customer interaction. Employees and customers communicate via phone calls, emails, live chat, social media, and even short message services (SMS).

XCaaS is one of the BPO trends and predictions to watch out for. This technology offers a unified platform for employees and customers for seamless communication. It integrates digital transformation and omnichannel solutions to enhance employee-customer interactions. 

BPO companies can capitalize on this technology to improve internal and external communication. BPO service providers can seamlessly communicate and collaborate with their clients using this centralized platform. At the same time, their BPO agents can utilize the same platform to assist their clients’ customers.

4. Remote Work: Carving the Future Business Landscape

Because of the pandemic, remote work has become more prevalent in business. Companies across different industries have seen the cost-effective benefits of flexible work arrangements.

According to Owl Labs, the number of employees choosing to work remotely rose by 24% in 2022 compared to 2021. While the demand for hybrid work increased by 16%, interest in in-house work decreased by 24%. Thus, remote work will likely shape our business landscape’s future.

The outsourcing sector is no exception, with remote work considered one of the BPO trends and predictions. Below are some types of work arrangements that apply to the industry:

  • Work-from-home (WFH) Setup. COVID-19 forced businesses to adopt the WFH setup, and some companies have continued such an arrangement. In the Philippines, for example, the government extended BPO firms’ requests to continue this arrangement without risking their tax incentives.
  • Hybrid Work Setup. The pandemic has also led to the emergence of hybrid work setups. Some BPO companies allow their employees to work from home on most days and go to the office occasionally for important business endeavors.
  • Gig Economy. The gig economy is a labor market where businesses hire part-time workers, usually independent contractors and freelancers. For their clients, some BPO providers tap into a pool of skilled freelancers such as virtual assistants and digital marketers.

5. Nearshore and Offshore Outsourcing: Expanding Operations

Nearshore and offshore outsourcing have long helped businesses scale operations and reduce costs. As some BPO trends and predictions suggest, companies plan to increase their adoption of these strategies for global expansion. To learn more about nearshoring vs. offshoring, consider the differences below:

  • Nearshore outsourcing entails contracting with BPO firms in neighboring countries, usually in similar time zones. For example, a retail company in the U.S. partners with BPO providers in countries in Latin America for its customer service operation. They hire bilingual agents to assist their American and Spanish customers.
  • Offshore outsourcing involves hiring overseas BPO service providers to handle certain business functions. For example, an e-commerce business delegates its customer support, data entry, and inventory management to BPO firms in the Philippines.

Top brands and tech giants have long outsourced to expand operations and access new markets. For example, The Coca-Cola Company initially outsourced its manufacturing and now has bottling partners operating worldwide. IBM is another example of a company that has outsourced 75% of its workforce globally to BPO providers.

The advent of globalization paved the way for nearshore and offshore outsourcing. The world has become a global village, and outsourcing has become instrumental.

6. Big Data and Cybersecurity: Leveraging and Protecting Information

The world of business deals with a massive amount of information that grows exponentially with time. Numerous providers in the BPO industry are responsible for collecting, recording, organizing, and securing their clients’ information.

As we live in a data-driven world, companies also employ big data analytics (BDA) for business forecasting and decision-making. Many BPO providers use BDA to effectively handle their clients’ data. The global BDA market is predicted to grow from $307.52 billion in 2023 to $745.15 billion by 2030 at a 13.5% CAGR.

Further, big data and cybersecurity go hand in hand as one of the BPO trends and predictions. Many businesses now hire service providers with cybersecurity solutions in place. These BPO firms set up strict network security and data privacy policies as they handle clients’ information. They seek to protect data against the following cyberattacks:

  • Password attacks. Hackers steal log-in credentials to gain unauthorized access to systems or networks.
  • Malware. Hackers use malicious software to gain unauthorized access or damage systems.
  • Phishing. Hackers trick vulnerable users into providing confidential information.
  • Distributed Denial of Service (DDoS) Attacks. Hackers flood a website or system with traffic, making it unavailable to legitimate users.
  • Man-in-the-middle (MITM) Attacks. Hackers intercept communication between two parties to steal data.

The Bottom Line

The Bottom Line - Stay up to date with the latest BPO trends

The outsourcing industry constantly evolves as it adapts and thrives in the digital age. Staying updated with the latest BPO trends and predictions is crucial for making informed outsourcing decisions. As such, consider the following trends:

  • Digital transformation
  • Omnichannel solutions
  • XCaaS
  • Remote work
  • Big data and cybersecurity
  • Nearshore and offshore outsourcing

Studying these industry trends helps you make the right decisions and stay ahead of the curve. Keeping abreast of predictions ensures your business is poised to achieve scalability, sustainability, and success.

Looking for a BPO partner aligned with current and future trends? Contact us, and let’s connect! Unity Communications offers various outsourcing services to businesses of all sizes across different industries. We will scale your business based on the latest BPO trends!


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Author - DIon Jay

About The Author

Dion Jay Tality is a content writer and one of the creative forces behind Unity Connect’s blog posts and marketing copy. Before joining Unity Communications, he spent over five years in the BPO industry, wearing various hats—from being a CSR and email and chat support specialist to being an SME and QA analyst. Name it; he tried it!

Passionate about writing, Dion loves to bring ideas to life through the power of words. When he’s not busy crafting content, you might find him working out, enjoying mindful walking, exploring conspiracy theories, or singing at the top of his lungs.

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