The public sector is under tight budget constraints, and there are pressures to find new cost effective and innovative ways to deliver services. As a result, private and third sector involvement in delivering public services is expected to grow and move into new areas, especially as the coalition government has openly stated its commitment to using markets, choice and competition to drive public service reform.
The outsourcing market will become increasingly diverse. The ICT-only outsourcing market is mature, and the focus will shift from back office infrastructure programmes to frontline service delivery, increasing the range of potential suppliers to government. The changing public service landscape will give rise to a new set of opportunities and threats to ICT suppliers. On the positive side, there are areas of growth for suppliers to target which, given the current spending constraints, is valuable. However, it also intensifies the competitive landscape as public service delivery specialists are moving into the market space that ICT service providers would prefer to occupy. The purpose of this report is to evaluate the current size of outsourcing opportunities, key drivers and suppliers, and provide a five year outlook on the future direction of travel.
Introduction and Landscape
Kable''s 2011 BPO report highlights key contract wins and changes throughout the year. It also highlights the big players in each public sector vertical.
Key Features and Benefits
The focus of this report is on outsourcing opportunities that include a significant ICT element. These range from the traditional outsourcing or management of the ICT infrastructure, where technology is at the core of the contract, to BPO agreements, where those processes require a significant investment in ICT to support delivery.
Naturally, there are a large number of support services, such as facilities management, that do not involve a significant ICT element. These types of outsources fall outside of the scope of this report, but are included within Kable''s wider UK Public Sector Outsourcing - The Big Picture publication, which looks beyond the use of ICT in the UK public sector to examine the broad range of services that are commissioned by public sector bodies.
For the purpose of this report, we regard outsourcing as including the following: