According to the latest annual report by Everest Research Institute, the Procurement Outsourcing (PO) market in 2007 continued on a growth path toward wider market adoption. With the number of new contract signings in 2007 matching that of 2006, the PO market is moving closer to entering a “rapid growth†phase as 2008 unfolds.
Several key dynamics took form in 2007, including:
- The emergence of a new PO value proposition representing the convergence of the traditional FAO and PO value propositions.
- Shifts in the competitive landscape in response to growing and morphing opportunities in the PO space
- Emerging buyer adoption trends around transactional PO, end-to-end processes, and “phased†engagements
In response to this increased market interest, suppliers continue to expand their capabilities in different ways and the market has even seen a few mergers and acquisitions. This report examines the global 2007 PO market and provides insights, detailed analyzes and implications for stakeholders into 2008 and beyond.
"Procurement outsourcing is redefining itself with the emergence of a 'phased' sourcing approach that benefits both buyers and suppliers," said Katrina Menzigian, Vice President, Everest Research Institute. "This phase-in approach is allowing the opportunity for testing of synergies, scaling up operations, developing industry-specific capability which, in turn, delivers better results and savings. Buyers are also able to 'experiment' with procurement outsourcing as they potentially migrate towards a full Source-to-Pay (S2P) strategy."
About Everest Research Institute.
Everest Research Institute (www.everestresearchinstitute.com) serves as a central source of independent and objective strategic intelligence, analysis, and actionable insight for leading corporations, service providers, and investors in the global outsourcing and offshoring marketplace.