Software Outsourcing Trends In 2021

software outsourcing trends for 2021

The significance of outsourcers in software development is progressively increasing. ACCORDING TO GARTNER, global IT spending is expected to reach an extraordinary value of $4 trillion at the beginning of 2021. At the same time, Statista stated the revenue of the global outsourcing industry was $92.5 billion in 2019 and rising. As system development lifecycle and software outsourcing shape the global market, revolutionizing how companies perceive their development and bringing unrivaled opportunities to seize, outsourced development teams have long ceased to function as simple contracted hands (or rather brains) instrumental in performing commissioned tasks. We know at Bydrec that given the complexity of projects and their core impact on the successful operating of entire enterprises, outsourcers will be recognized as decision-makers on the same basis as the managerial staff. They will share in strategic planning, risk prevention, system architecture design and generally act as visionaries responsible for policy-making in organizations.

Today, the pace of scientific progress is so swift, and the scope of digitization is so vast that it is hard for an in-house IT department (if the company has one) to stay in the know of all that is going on in the high-tech realm. Innovations and new applications of existing technologies crop up almost every week, so attempts to touch all the hot buttons are doomed to defeat no matter how well-versed in modern technologies a group of specialists might be. 

How Big Is the IT Outsourcing Industry? 

(According to Outsource Accelerator and technavio)

Depending on whose statistics you look at, the global IT outsourcing industry was worth between $92.5 billion and $388.65 billion in 2019. The reports show us that we can expect it to reach $114 - $486 billion by 2025. However, whichever way you count it, outsourcing is growing at a rapid rate.

As we work through the year, we will witness a growing demand for high-quality experts, some in narrow fields, that can bring maximum value to the project they are assigned to. However, if an outsource supplier has a whole list of experts who can provide a full-cycle system or product development, they will get a serious edge over competitors and will be searched for more eagerly. 

The majority of organizations across sectors are accelerating their digital transformation, especially fintech, healthcare, and telecom. Businesses in these industries are following IT outsourcing trends and are the most likely clients searching for IT outsourcing services.

Given the global changes, 2020 has brought, outsourcing trends for 2021 have seen more agility, diversity, and automation. Outsourcing trends for 2021 are promising, and the IT outsourcing industry can help businesses cope with new challenges caused by the crisis of Covid-19.

Is Outsourcing Increasing or Decreasing?

According to Deloitte, due to the pandemic, the outsourcing industry is expected to increase. 

  • First of all, since companies started to incorporate a remote working model, people have become more comfortable with virtual meetings, interviews, and hiring. 
  • Secondly, the companies are trying to preserve their money due to the economic crisis, leading them to turn towards outsourcing. 
  • Thirdly outsourcing is still one of the essential tools for client organizations and strategies. 

Here are some of the trends we and others are looking at for 2021:

In-demand Tech Skills

Fintech, AI, connected technologies, and quantum computing are all expected to be in-demand jobs in 2021

Flexible Vendors

The nature of relationships with vendors is changing, and so outsourcing providers will need to be flexible

Strategic Partners

Nearshore teams will become part of the clients' organization. Relationships between the external software developer and the client's representative are increasingly human-oriented, focusing on the quality of both cooperation and implementation and simplification of processes – and not just the price. This leads to more robust competition among the outsourcing industry, translating into a higher quality final product. Thus, the most important thing for the IT outsourcing providers is to be a reliable partner who understands their client's processes well.

Quality Takes Over From Price as a Priority

While a few years ago, the demand for outsourcing services was greatly influenced by the need to cut costs, in 2021, companies will focus on quality rather than lower prices.

It's Not Only for Big Companies

IT outsourcing is an exceptional opportunity for the micro and small enterprise sector, which often face the need to reduce costs. At the same time, they want to access the latest technologies and solutions that allow for flexible management of business processes.

Core Business Services Outsourced

Instead of just handing over the non-core services to a service provider, more and more companies are now outsourcing even their core business to outsourcing companies.

Cutting Edge Technologies

More and more clients are placing orders on custom mobile app development using Blockchain technology. Outsourcing companies will need to invest more in these technologies or to partner with a leading company in the field to provide more options to existing and new customers.

Outsource Software Development

IT outsourcing is undergoing constant changes trying to address the challenges posed by ever-shifting external conditions. Businesses that don't want to fall behind are already investing their time and money into digital transformation. Still, there are several challenges, one of which is the speed of innovation. While even huge companies with well-equipped teams cannot keep up with the pace and are in dire need of outsourcing specialists, companies of smaller size cannot embrace all the digital changes without a supporting outsourcing team. Companies will be looking for outsource partners to share risks and together create better value.

Bydrec is an outsourcing company that specializes in nearshore software development. We provide dedicated software developers to companies who need resources to ensure high-quality output and timely completion of their projects. To learn more about nearshore outsourcing, contact the expert team at Bydrec on (866) 219-7733 or Email:

Topics: software development outsourcing, outsourcing company, software developer, system development life cycle, Software Outsourcing Trends In 2021


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