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The knowledge process outsourcing market size is estimated to grow by USD 90.55 billion at a CAGR of 15.5% between 2022 and 2027. The growing digital transformation, driven by the need for businesses to stay competitive and agile in a digital world, is driving market growth by increasing the adoption of digital technologies and solutions. The focus on reducing operational costs, driven by economic pressures and the need for efficiency, is also boosting market expansion by creating demand for cost-effective solutions and services. Additionally, the increasing demand for specialized knowledge and expertise, driven by the complexity of modern business environments, is driving the development of specialized solutions and driving market growth. Overall, these factors are driving the growth of the market and driving innovations in digital transformation and operational efficiency.
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This market report extensively covers market segmentation by type (legal process outsourcing, financial process outsourcing, R&D outsourcing, publishing outsourcing, and others), end-user (BFSI, healthcare, IT and telecom, manufacturing, and others), and geography (North America, APAC, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The market share growth by the legal process outsourcing segment will be significant during the forecast period. The segment involves outsourcing legal services to third-party service providers. These services generally include legal research, contract drafting and management, document review, patent drafting and filing, intellectual property management, and litigation support.
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The legal process outsourcing segment was valued at USD 18.45 billion in 2017. LPO services help companies save significant costs, as they do not have to establish an in-house legal processing department. Legal processes can be outsourced to LPO service providers in countries such as India, the Philippines, and South Africa, which have low labor costs. Moreover, LPO service providers have a pool of lawyers and legal experts with diverse backgrounds. The growth of the LPO segment is attributed to factors such as the increasing demand for legal services from businesses and law firms worldwide.
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North America is estimated to contribute 39% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
North America is a lucrative market, especially in the BFSI sector, as the region is an early adopter of advanced technologies. The presence of top companies fuels the market growth in the region. The KPO market in the region is expected to grow at a moderate rate during the forecast period, as the market is mature when compared with other regional markets. Various companies in the region are launching new technological platforms and are forming partnerships to ease business processes. For instance, In July 2021, Accenture acquired HRC Retail Advisory to strengthen its retail strategy capabilities. Thus, the increasing adoption of technologies, innovations with technological platforms, and partnerships across various industries are driving market growth in the region during the forecast period.
The market is witnessing significant growth driven by the need for operational efficiency and the use of third-party service providers for engineering design outsourcing. Companies are increasingly leveraging Engineering Services Outsourcing (ESO), particularly in automobile design and other industries requiring specialized expertise. The rise of data-driven organizations has led to a focus on data security and the adoption of cloud-based work platforms. The IT industry is a key player in this market, offering business intelligence and analytical tools to enhance KPO services. The market is characterized by its role in cost reduction and the outsourcing of labor-intensive tasks such as contract drafting. Clients benefit from access to skilled professionals in various fields, including engineers and architects, while protecting sensitive information and reducing real estate costs. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The growing digital transformation is notably driving the KPO market growth. Various companies are adopting advanced technologies such as AI, machine learning (ML), and robotics process automation. Implementing advanced technologies like AI, machine learning (ML), and robotics process automation effectively requires specialized knowledge and expertise. They involve outsourcing labor-intensive tasks, such as contract drafting, to specialized service providers. These providers have the necessary expertise and resources to handle sensitive information and deliver high-quality results. By outsourcing these processes, companies can access a pool of highly skilled professionals and advanced technologies.
Many companies use KPO to support their digital transformation efforts. For example, in 2020, Wipro partnered with Marelli to provide engineering services. Similarly, Accenture has assisted a leading healthcare company in developing and implementing a digital transformation strategy, emphasizing the importance of data-driven organizations and data security. Therefore, the increasing digital transformation across industries is expected to drive the growth of the market in the forecast period.
The growing number of delivery centers is a key trend influencing the KPO market. The market has been growing in recent years due to the rising number of delivery centers. These centers provide cost-effective solutions to companies that are looking to outsource their back-office operations, R&D, and analytics activities. The availability of a skilled workforce drives the growth of delivery centers, especially in developing countries such as India, the Philippines, and China.
The use of advanced technologies such as ML and AI is also contributing to the growth of delivery centers. Companies can outsource complex knowledge-based tasks to service providers globally with the advent of cloud computing, artificial intelligence, and machine learning. This helps companies lower their operational costs and increase productivity. For instance, in 2021, Tata Consultancy Services (TCS) announced the launch of its new delivery center in Texas, US. Therefore, the growing number of delivery centers is supporting the growth of the market.
The risk of data breaches may impede the KPO market growth. KPO involves the outsourcing of high-value, knowledge-intensive processes to specialized service providers. However, the outsourcing of knowledge processes can risk the confidentiality, integrity, and availability of sensitive data. Data breaches can lead to consequences such as financial loss, reputational damage, and legal issues.
The risk of data breaches can prevent companies from outsourcing critical processes, which can slow down the knowledge process outsourcing (KPO) market. For instance, in 2021, Wipro faced a data breach that impacted several clients. The breach enabled attackers to access sensitive information, including financial data, intellectual property, and personal information. Similarly, in 2020, a ransomware attack on Cognizant resulted in data theft and service disruption. Therefore, the risk of data breaches might hinder the growth of the market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
HCL Technologies Ltd. - The company offers knowledge process outsourcing services, which serve industries such as insurance, healthcare, banking and financial services, media, retail, and others.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market report forecasts market growth by revenue at global, regional, & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The market is witnessing significant growth, driven by the demand for specialized talent in fields such as engineers, lawyers, and architects. KPO providers are focusing on reducing the product and service introduction cycle time and alleviating the employee burden by offering expertise in specific industries, particularly finance. This includes outsourcing financial processes, research & development, and leveraging technological advancements and new tools for knowledge-based services. Customers, including banks and financial analytics firms, benefit from improved data management and access to specialized expertise. The market is also seeing growth in off-shoring and professional services, attracting investors, consultants, and business strategists due to its promising Concentration Ratio.
Knowledge Process Outsourcing Market Scope |
|
Report Coverage |
Details |
Page number |
176 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 15.5% |
Market growth 2023-2027 |
USD 90.55 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
14.56 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 39% |
Key countries |
US, China, India, Germany, and UK |
Competitive landscape |
Leading companies, market positioning of companies, competitive strategies, and industry risks |
Key companies profiled |
Accenture Plc, Capgemini Service SAS, Cognizant Technology Solutions Corp., CRISIL Ltd., Ernst and Young Global Ltd., HCL Technologies Ltd., Hexaware Technologies Ltd., Infosys Ltd., International Business Machines Corp., McKinsey and Co., Mphasis Ltd., Oracle Corp., SAP SE, Sutherland Global Services Inc., Tata Consultancy Services Ltd., Wipro Ltd., WNS Holdings Ltd., ExlService Holdings Inc., Genpact Ltd., and Moodys Corp. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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