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KPMG Deal Tracker - 4Q15

KPMG Deal Tracker - 4Q15

It gives me great pleasure to bring to you the year-end 2015 edition of the KPMG Global IT-BPO Outsourcing Deals Analysis.

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January to December 2015

It gives me great pleasure to bring to you the year-end 2015 edition of the KPMG Global IT-BPO Outsourcing Deals Analysis.

 

Key highlights: 

  • The number of BPO deals has been decreasing since 2013 with organizations typically looking for alternative options for cost reduction, such as greater use of shared services, it remains to be seen as to whether this is portent of a shrinking business process offshoring pie.
  • Of the three years (2013 - 15) analyzed, the year 2015 was the strongest year for outsourcing in terms of total contract value (TCV). However, the number of deals signed were lowest in 2015 during the period, indicating that larger size deals were signed in the year.
  • Worldwide in 2015, 721 ITO contracts worth USD136.2 billion and 114 BPO contracts worth USD14.8 billion were signed.
  • Globally, 56 IT-BPO Bundled deals were signed in 2015 with aggregate contract value of USD8.1 billion.
  • Average deal tenure for contracts in 2015 was 4 years 1 month which was shorter compared to the previous two years, indicating the continuity of the market’s proclivity towards shorter tenure deals. 
  • Defense was the top consumers of IT-BPO services contributing 53 percent of the total deal value signed in 2015. Telecom and Government sectors were the next big contributors by deal value IT Bundled Services and HRO Services
    contributed USD62.2 billion and USD4.3 billion respectively and were largely
    procured services globally within ITO and BPO outsourced services respectively, in 2015.
  • Average annualized contract value in 2015 was USD43.5 million as compared to USD23.4 million during 2014 showing an increase of around 86 per cent.

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