KPMG: Outsourced support services in decline

By Rob Starr, Content Manager, Big4.com

According to KPMG’s latest global pulse survey, demand is expected to fall in the last half of 2012, matching the lower-than-expected levels of growth experienced earlier in the year.The declining confidence surrounding anticipated future demand for outsourced services stems from respondents’ experiences over the past three months. Today’s data reveals, for example, that 61 percent believe there is room for optimism
about business prospects, but this figure has fallen from 68 percent, at the start of the first Quarter.

Shamus Rae, partner in KPMG Management Consulting’s shared services and outsourcing advisory team commented:

“Negative market conditions in the Euro Zone continue to have a detrimental impact on business confidence as uncertainty forces buyers to delay
decisions.  The knock-on effect is also being felt as organisations maintain a tight rein over discretionary spending,” he said.  ” Amongst those
business customers who are renewing contracts, cost reduction has regained its position as the primary driver to outsource key services, but the ongoing market volatility is driving organisations to focus on short-term initiatives rather than projects that will boost performance over the longer-term.”