Cloud threat to traditional 'lift and shift' business process sales

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Cloud threat to traditional 'lift and shift' business process sales

Simon Quicke

Resellers selling business process services will have to make a move towards the cloud or face seeing their traditional business being squeezed by more flexible competitors.

The warning that change is coming in the next couple of years has been sounded by analyst house TechMarketView which forecasts that the business process services (BPS) market is set for growth.

The next three years will see a 7% annual compound growth rate in the BPS sector as the market reaches £6.6bn by 2014, a 31% increase on the revenues in 2010.

The public sector is expected to be a major customer of services that will help streamline business processes and reduce costs as it looks to do its bit to reduce the deficit.

But with the cloud becoming a more popular method of delivering BPS to customers those suppliers that stick to traditional sales options will find their business getting squeezed.

"Organisations across both the public and private sectors are increasingly adopting business process platforms such as life and pensions, HR, payroll, and revenues and benefits (R&B) administration systems, to benefit from their greater flexibility, performance and cost of delivery," said John O'Brien, research director at TechMarketView.

"The emergence of 'the cloud' is the catalyst for many of these changes, and over the next few years, it will encourage organisations to seek alternatives to straight 'lift-and-shift'," he added.

TechMarketView expects customers to move towards a business process as a service platform in increasing numbers over the next few years with it taking just shy of a quarter of the market by 2014.

From that point onwards the analyst house expects to see non-platform-based BPS enter into terminal decline.

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