A Brief History of Outsourcing

Genesis of an industry

Outsourcing has been changing the game since its inception.

What started in the early 18th century, as the import/export business took hold during the industrial revolution, has evolved into something much more.

It has become the catalyst for strategic shifts by smart companies to leverage a wealth of global talent and technological opportunities.

And it brings with it an opportunity for tremendous cost reduction.

Evolution of the game

As the world embraced globalization during the 1990s and 2000s boom period, outsourcing evolved beyond mere cost-saving

It became a strategic tool for business growth. 

Shanghai Lujiazui global financial district at sunset
Evolution of the game

The rise of information technology and the internet has only served to further facilitate this shift. 

Businesses began to outsource more complex functions, like customer service and IT operations, to specialized firms.

This marked a notable expansion period, with Business Process Outsourcing (BPO) sectors in lower cost countries like India and the Philippines exploding in popularity.

The current landscape

Outsourcing today is an integral part of the global business landscape.

It’s no longer just about cost-saving; it’s about adding value and innovation to any business smart enough to step up and take advantage of the increasingly globalized world.

With the AI revolution well and truly underway, the possibilities for outsourcing are seemingly endless.

Whether it’s Amazon with their cloud computing services, IBM with their data analytics, or Google with their AI, companies are redefining technology at a staggering rate, and all of these areas are rapidly becoming hotspots for outsourcing.

Challenges overcome

The road hasn’t been entirely smooth.

Outsourcing faces challenges like any business, with factors like quality control, data security, and cultural differences all playing a part in the evolution of the business model.

But the industry has adapted. 

Strict quality standards have been implemented, together with heavy investment in cybersecurity, and focusing on cross-cultural training.


The future of outsourcing will be more collaborative and technologically driven, that much is obvious.

Automation and AI will naturally play a part, changing how services are delivered.

But there is something else; a surge in ‘smart outsourcing’.

automation factory concept with 3d rendering control panel screen with robotic arms

Decision-making and processes becoming increasingly automated, leading to greater efficiency, more innovation, better customer service all round.

The net result of all this?

An ability for all businesses willing to take the ride the wave to foster deeper, more strategic partnerships between them and their outsourcing partners. 

Traditional models, redefined.

The question for your business

How will outsourcing shape the future of your organization?

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About OA

Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO).

The #1 outsourcing authority

Outsource Accelerator offers the world’s leading aggregator marketplace for outsourcing. It specifically provides the conduit between world-leading outsourcing suppliers and the businesses – clients – across the globe.

The Outsource Accelerator website has over 5,000 articles, 450+ podcast episodes, and a comprehensive directory with 3,900+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.