The North American strategic document outsourcing (SDO) market is projected to total $17.6 billion in 2011, a 2.8 percent increase from $17.2 billion in 2010, according to Gartner, Inc. The market is expected to reach $18.3 billion in 2012 and reach $20.8 billion in 2015.
"Business conditions through the latter half of 2011 and into 2012 will play a big part in the continued growth of the market," said Pete Basiliere, research director for Gartner. "If recessionary conditions persist, then the inability to access capital needed to fund equipment or software refresh projects may drive more buyers to abandon and sell off their costly in-house operations, which could result in greater revenue increases for the providers. However, many organizations will be reluctant to actually sign an SDO contract for fear the transition may negatively impact their ongoing operations at a time they can least afford a disruption that cuts into revenue or profits, which could impact the outlook for the market."
SDO is the subset of business process outsourcing (BPO) focused on the publication of customer communications, including content creation, multimedia presentation and incoming document processing. The outsourced documents may be transactional forms, sales collateral, direct-marketing materials and more. The documents can be published in physical or electronic media, or a combination of multiple media.
The inbound services segment will experience strong growth over the forecast period, beginning with a 5 percent revenue increase from 2010 to 2011 and averaging 6.5 percent revenue growth through 2015. This growth is spurred on by the clients' need for completely automated workflows, competitive price pressures over the longer term and the SDO providers' ability to supplement inbound services revenue with other value-added SDO services.
In-process management services will experience a 2.9 percent increase in 2011. Growth in this segment is driven by print supply chain management, which will grow mainly because large organizations have lost the expertise necessary to purchase marketing materials and other printed matter and not because organizations are printing more.
"Enterprises can save 20 percent to 40 percent by outsourcing print purchases to an SDO provider who works with the enterprise not only to select the right printing companies, but also to enforce the common design elements that save money while protecting the brand image and more," said Mr. Basiliere.
Outbound services will grow 1.9 percent in 2011. The multimedia publishing segment of outbound services has significant revenue potential and is expected to grow 5 percent in 2011. Multimedia publishing incorporates all of the marketing materials and related campaigns, whether in print or electronic form, or, ideally, in both.
Repository services, often known as archiving, involve storage of the clients' documents and other materials in physical and/or electronic format, as well as subsequent retrieval when needed. Cost containment, reduction of primary on-site storage capacity associated with archiving and e-discovery are the primary drivers for outsourcing the archive function. This segment is forecast to grow 2 percent in 2011 and 4 percent in 2012.
Additional information is available in the Gartner report "Forecast: Strategic Document Outsourcing, North America, 2010 - 2015.” The report is on Gartner's web site at http://www.gartner.com/resId=1780515.
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