Procurement outsourcing 'key to business recovery'

31 August 2009

01 September 2009 | Allie Anderson

Business leaders believe outsourcing procurement can play a vital role in helping firms recover from the financial crisis.

Almost three-quarters - 74 per cent - of business executives quizzed by consultancy Capgemini said outsourcing functions such as procurement, IT, finance and HR can help organisations survive in the current economic climate.

According to 70 per cent of respondents, outsourcing "drives savings that can help a company grow". A further 60 per cent believe outsourcing "makes companies more flexible".

Capgemini questioned more than 150 senior executives at a range of Fortune 1000 companies about how public perception affects their outsourcing decisions.

It found 79 per cent are aware outsourcing may have a poor public perception, but 72 per cent would press ahead with decisions despite this.

David Poole, vice-president and head of business process outsourcing for the Americas at Capgemini, said: "Companies that outsource are better poised for the future, because they are able to reinvest their savings to drive innovation. Over time, the business can build, expand and emerge from the economic slump in a stronger position because, through outsourcing, they have been able to focus on their core business."

According to Capgemini, outsourcing spend has grown steadily in the past decade. In the UK, the market is also expected to pick up as firms look at ways to cut costs.

SMsep2009

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