1. Cloud Computing

As Azure Microsoft notes, cloud computing entails providing computing services, which encompass servers, storage, databases, networking, software, analytics, and intelligence, through the internet (referred to as “the cloud”). This approach facilitates rapid innovation, resource flexibility, and economies of scale. Typically, you are billed solely for the cloud services you actively utilize. This cost-effective model allows you to reduce operational expenses, enhance infrastructure efficiency, and adapt to evolving business requirements.

How will it be applied in ITO?

In the context of IT outsourcing, this technology will be utilized by businesses that leverage cloud-based services and show heightened concern over cybersecurity. To safeguard against potential threats, they will opt to outsource security services. ITO providers will prioritize offering solutions based on cloud computing. Through strategic partnerships, companies can delegate their responsibilities and entrust cloud storage and security management to external experts. This evolving trend empowers organizations to attain enhanced scalability, cost-effectiveness, and elevated data security. Among the trends in the realm of ITO services, cloud computing is for sure on top in 2023.

 2. Artificial Intelligence (AI) and Machine Learning (ML)

Artificial intelligence (AI)  is a subfield of computer science. The goal of AI technologies is to emulate or exceed human-like capabilities in computational systems. These capabilities encompass various aspects:

• Learning,
• Reasoning,
• Pattern-recognition,
• Problem-solving,
• Visual perception,
• Language-understanding.

The origins of machine learning (ML) trace back to the field of statistics. ML employs algorithms and statistical models to accomplish tasks without relying on explicit instructions, but rather by identifying patterns and making inferences. For example, ML applications can do:

• Text analysis,
• Music matching,
• Image recognition,
• Real-time translation,
• Accurate identification of faces, speech, and objects.

But statistics can say more than words. Following MarketsandMarkets, the AI market is anticipated to achieve an impressive value of $407 billion by the year 2027, showcasing substantial expansion from its projected revenue of $86.9 billion in 2022.

What does this trend mean for the industry?

In the year 2023, the pivotal role of IT outsourcing providers will involve the development and implementation of AI-driven solutions, encompassing chatbots, virtual assistants, and predictive analytics. These advancements are geared towards enriching customer experiences and catalyzing operational efficiency. This is explained by the fundamental goal of artificial intelligence, which is to streamline human efforts by handling routine tasks, thereby affording individuals the capacity to focus on overarching business objectives.

AI holds the potential to address prevailing challenges in the outsourcing realm, including sluggish response times and security vulnerabilities. The synergy of AI’s machine learning and blockchain technologies empowers automation, endowing software applications with the ability to learn and evolve rather than merely executing predefined commands.

For instance, artificial intelligence substantially elevates the quality of customer service, which  extends to the sphere of outsourcing as well. Through AI, distinct client journeys become possible , which provides invaluable guidance for informed decision-making. Notably, chatbots emerge as indispensable helpers  providing requisite advice essential for service acquisitions.

Moreover, the realm of artificial intelligence extends its influence to the realm of financial transactions. AI’s capability to decipher invoice terms and render judgment-based determinations fosters automation, which  mitigates errors and increases  productivity thanks to  seamless information processing.

 3. Internet of Things (IoT)

The Internet of Things refers to devices equipped with sensors, processing capabilities, software, and related technologies, which establish connections and exchange data with other devices and systems via the Internet or alternative communication networks. IoT encompasses the domains of electronics, communication, and computer science engineering. The term “Internet of Things” has often been deemed a misnomer, as devices need not be linked to the public internet. Instead, they simply require connection to a network and the ability to be individually addressed.

IoT has gained immense importance potentially transforming our lifestyles and workplaces. This technology’s prominence stems from its capacity to enhance people’s quality of life. Internet of Things devices enable health monitoring, physical activity tracking, and provide individuals with disabilities with increased independence . Additionally, IoT is used in smart homes, enabling remote device control and customization according to personal preferences.

How to implement IoT in IT outsourcing?

The Internet of Things has various applications in IT outsourcing. IoT sensors gather data on system health, performance, and environmental conditions. This information identifies patterns, detects anomalies, and predicts potential issues. Security threats, system malfunctions, and equipment failures can be detected by monitoring user behavior and application performance. Predictive maintenance based on IoT data enables proactive scheduling, reducing downtime and preventing costly breakdowns.

Furthermore, IoT technology provides insights into IT infrastructure usage. This data optimizes server and network settings and ensures efficient performance. IoT data also identifies server utilization trends, highlighting areas for optimization. Overall, IoT enhances IT outsourcing by offering data-driven solutions for improved efficiency and minimized risks.

 4. Cybersecurity 

Richard A. Clark, an American national security expert, once said: “If you spend more on coffee than on IT security, you will be hacked. What’s more, you deserve to be hacked”. Due to increasing cyberattacks, high-level data security can become a hot topic in upcoming years. According to recent data breach statistics, it takes nearly 7 months for most companies, including even the largest ones, to identify a data breach. 

How will this affect ITO?

While numerous cloud service providers offer security solutions, these often fall short of meeting the requirements for enterprise-level security. In response, IT outsourcing providers place a priority on delivering comprehensive security measures encompassing threat identification, data encryption, and incident management. These efforts are aimed at protecting sensitive data and ensuring adherence to regulatory standards. 

 5. Blockchain Technology

According to Investopedia, blockchain is a distributed database or ledger shared among a computer network‘s nodes. The technology is best known for its crucial role in cryptocurrency systems for maintaining a secure and decentralized record of transactions, but its usage is not limited to cryptocurrency. Blockchains can be used to make data in any industry immutable.

Since its inception in 2009, Bitcoin has catalyzed a proliferation of blockchain applications. This encompasses the emergence of diverse cryptocurrencies, decentralized finance (DeFi) platforms, non-fungible tokens (NFTs), and smart contracts. 

The transformative potential of blockchain technology is underscored by its capacity to heighten transaction transparency, mitigate risks and fraud, and enhance resilience against external attacks – all while remaining cost-effective. These attributes are driving transformative changes across a range of industries, spanning healthcare, real estate, insurance, and beyond.

How is it connected with ITO?  

IT outsourcing providers are poised to offer their expertise in blockchain development, smart contracts, and decentralized applications. This enables businesses to harness the advantages of this secure and transparent technology.

Developers have the capability to create applications using blockchain technology, ensuring the secure storage of data across a multitude of decentralized computers. Among the most prominent upcoming trends in IT outsourcing is the provision of blockchain services. This trend is propelled by the widespread appreciation for the concept of a decentralized web. As this transformation gains momentum, it will become a pivotal asset in the business landscape. An increasing number of businesses are transitioning to blockchain technology, creating a surge in demand for proficient software vendors.

Conclusion

 All these techniques are having a huge impact on IT outsourcing and making it more efficient, innovative and convenient. In HYS Enterprise, we always manage to stay up-to-date with recent technologies and trends. For major parts of our projects we utilize cloud computing and use Azure when cooperating with Microsoft . Furthermore, we leverage AI and ML technologies to create assistants, chatbots, and work with data. Contact Us Now to learn how we can use the power of the above-mentioned technologies to help you meet your business needs.  

Sources:

• NIBUSINESSINFO.CO.UK. Artificial Intelligence in business. Retrieved from https://www.nibusinessinfo.co.uk/content/what-artificial-intelligence-ai
• Joseph Foresi. (2020). Managed Services and As-a-Service Market Insights. ISG Index. Retrieved from https://isg-one.com/docs/default-source/default-document-library/4q19-global-isg-index.pdf?sfvrsn=53cc631_4
• Outsourcing and Shared Services. (2019-2023). Monitor Deloitte. Retrieved from http://outsourcing-outlook.com/assets/pdf/Deloitte-DOC-Whitepaper_outsourcing-and-shared-services2019-2023.pdf