Industrial IoT offers faster return on investment for global service providers striving to meet enterprise demand
Internet of Things (IoT) is among the top three priorities for digital transformation for enterprises across industries; however, to move forward, companies will have to overcome key challenges, among them a complex ecosystem, data privacy and security issues, critical infrastructure and platform decisions, and investment challenges, according to Everest Group.
Currently, enterprises in the manufacturing and energy & utility sectors are the leading IoT adoptors. Industrial applications of IoT (commonly referred to as IIoT) are instrumental in increasing machinery uptime, enabling end-to-end supply chain visibility, reducing energy costs and preventing infrastructure failures. Service providers, too, have a high interest in IIoT, because IIoT offers faster return on investment than consumer IoT such as wearables and smart home devices.
Everest Group describes IoT and IIoT trends and the investments that service providers are making to capitalize on this new growth opportunity in its recently released Market Vista™: Q2 2017 report.
In addition, the report discusses outsourcing transaction trends, GIC-related developments, global offshoring dynamics, location risks and opportunities, and key service provider developments.
“Although transaction activity declined slightly in Q2 compared to Q1, it was a good quarter for the sourcing industry in many other aspects,” said H. Karthik, partner at Everest Group. “GIC market activity increased; location activity in Q2 was at an all-time high, with Europe, in particular, witnessing significant growth in activity compared to Q1; and most service providers reported sequential growth in revenues.”
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Everest Group held a webinar on August 17 in which the findings of the “Market Vista: Q2 2017” report were reviewed. During this one-hour webinar, Everest Group experts discussed the factors disrupting the sourcing market—including digital technologies, regulatory changes and geo-political dynamics—and shared how multiple startups have emerged to fill the innovation gaps with new solutions and platforms. A particular focus of the webinar was the increasing adoption of U.S. domestic sourcing. Everest Group experts described the drivers behind increasing adoption and the experiences of firms in managing their domestic sourcing strategies.
Key Market Trends in Q2 2017
- GIC activity continues to be driven by existing adopters, with focus on establishing R&D centers for next-generation technologies.
- Outsourcing demand from the United Kingdom continued to remain low due to uncertainty with Brexit and reduced outsourcing by cash-strapped healthcare and government sectors.
- Reduced revenue growth is pushing service providers to form partnerships rather than invest in acquisitions.
- Leading locations—India in Asia Pacific, Northern Ireland and Romania in nearshore Europe, and Brazil in Latin America—witnessed a spike in new delivery center setups
***A complimentary 4-page preview of the report is available for download here.*** (Registration required.)