Companies must review outsourcing to mitigate geopolitical risk: Gartner

Bengaluru: Fears of geopolitical instability may impact the global offshore services market, as sourcing, procurement and vendor management executives review their options to mitigate risk, according to Gartner, Inc.

The offshore outsourcing market has been relatively stable in recent years, with organisations using a mix of onshore, nearshore and offshore resources with relatively stable demand and supply patterns, the research and advisory firm said.

However, recent events like the Sri Lankan terrorist attacks, the US-China trade dispute and political tensions in Hong Kong are raising fears of delivery disruptions, it said.


“Political and economic stability is an important factor in offshore outsourcing arrangements,” said Jim Longwood, research vicepresident at Gartner.

“Gartner has started fielding more questions from clients about how to address these scenarios. This includes whether to stop sourcing services from a particular country, move services to another country or bring them back onshore. Each option is quite costly and can disrupt service delivery in the short-to-medium term,” he said.