Through 2006, sales of business-process outsourcing services will grow 13.7% annually, compared with 7.7% for the overall IT industry, according to Soundview Research.
Businesses are more likely to work with several outsourcers. As a result, service providers say customers are demanding new tools to more easily stay on top of the many business functions they've outsourced. Human-resource outsourcer Hewitt Associates LLC has created an advanced portal from which HR executives can get a real-time picture of staffing levels, turnover rates, benefits costs, and the like. "The information we provide to them has to be at least as good as what they would have if they were running operations internally," says Ed Rumzis, technology leader at Hewitt's workforce-management practice.
Adecco Employment Services also is rolling out systems to control outsourced HR. It used the J2EE development language and BEA Systems Inc.'s WebLogic Server to build in just three months AdeccoClub, a Web-based portal that gives users access to a full range of HR data.
Service providers themselves are turning to outsourcing to keep a lid on costs. Bowne & Co., a document-management-services provider, has moved much of the typesetting and document preparation work it does for clients to a service provider in India. To ensure quality, Bowne gave the service provider intranet access to its own tools. It's the first time Bowne has let a third party access its proprietary software.
Service companies can expect growing demand for their offerings. Service-sector activity surged in July, the fourth straight month of gains and the best reading on the sector in six years. The Institute for Supply Management reported its nonmanufacturing-business index jumped to 65.1, the highest level since the gauge was introduced in July 1997, from 60.6 in June. Readings above 50 indicate growth in activity, while those below point to contraction. The index's previous high occurred in October 1997, when it hit 63.2.
|Rank||Company||Revenue in millions||Income (loss)
|18||Adecco Employment Services||$17,900||$259||905|
|28||Hewitt Associates LLC||$1,720||$190||2,040|
|63||Bowne & Co. Inc.||$1,003||--||305|
|86||Volt Information Sciences Inc.||$1,488||($33)||200|
|99||Equity Office Properties Trust||$3,613||$770||90|
|115||Ogilvy & Mather Worldwide||--||--||290|
|132||Ernst & Young LLP||$10,124||--||1,100|
|190||Waste Management Inc.||$11,142||$822||346|
|205||Iron Mountain Inc.||$1,318||$58||400|
|276||Booz Allen Hamilton||$2,200||--||186|
|286||ABM Industries Inc.||$2,182||$47||75|
|351||Pitney Bowes Inc.||$4,410||$476||610|
|361||Day & Zimmerman Group Inc.||$1,400||--||141|
|445||American Management Systems Inc.||--||--||6,625|
|476||Kelly Services Inc.||$4,323||$19||--|
|Financial data is from
public sources and company supplied.
Revenue is for latest fiscal year.
Employee data is from InformationWeek 500 qualifying survey.