Oman might be known for its stunning landscapes and rich history, but a new story is unfolding in this Gulf nation: the rise of outsourcing. Driven by a bold vision for the future and a rapidly evolving business landscape, Oman is becoming a hotbed for companies seeking to make the most of external expertise and gain a competitive edge.
But what exactly is driving this outsourcing surge? And what trends can we expect to see in 2025 and beyond? In this blog post, we’ll explore the key factors shaping Oman’s outsourcing landscape, from government initiatives to the rise of new technologies. Let’s find out why Oman is emerging as a prime destination for businesses looking to outsource and thrive.
Oman’s Business Process Outsourcing Forecast
Oman’s Business Process Outsourcing (BPO) market is poised for significant growth in the coming years. This sector, which involves contracting specific business tasks to third-party providers, is gaining traction as companies seek to streamline operations, reduce costs, and focus on their core competencies.
In 2024, the BPO market in Oman is projected to generate $122.60 million in revenue. This indicates a healthy and growing sector. Looking ahead, the market is expected to expand at a compound annual growth rate (CAGR) of 3.41% between 2024 and 2029, reaching a total value of $145.00 million by 2029. This steady growth trajectory reflects the increasing adoption of BPO services across various industries in Oman.
Some of the key BPO services gaining traction in Oman include:
- Customer service and support
- Human resources management
- Finance and Accounting
- Data entry and processing
- IT support and maintenance
Another indicator of the BPO market’s strength is the projected average spend per employee. In 2024, this figure is estimated to reach $49.17. This demonstrates that companies are willing to invest in BPO services to enhance their efficiency and productivity.
Oman’s Vision 2040 Lends a Helping Hand to Outsourcing
Oman is on a mission to transform its economy, and outsourcing is playing a key role in this journey. Central to this transformation is Oman Vision 2040, a comprehensive roadmap guiding the nation’s development towards a diversified and sustainable future. This vision explicitly recognizes the importance of non-oil sectors, including Information and Communications Technology (ICT) and logistics, which are fertile ground for outsourcing.
Key Goals of Vision 2040
- Economic Diversification: Reducing reliance on oil revenue and fostering growth in sectors like tourism, manufacturing, logistics, and ICT.
- Private Sector Development: Encouraging private sector investment and entrepreneurship to create jobs and drive economic growth.
- Human Capital Development: Investing in education and training to build a skilled and adaptable workforce.
- Technological Advancement: Promoting the adoption of advanced technologies and innovation to enhance productivity and competitiveness.
How Vision 2040 Fuels Outsourcing
By prioritising the development of the ICT sector, Vision 2040 creates demand for IT outsourcing services, including software development, cloud computing, cybersecurity, and data analytics. Oman’s ICT spending is projected to reach $2.2 billion by 2024, driven by Vision 2040 initiatives. The contribution of the non-oil sector to Oman’s GDP is expected to increase to 90% by 2040.
Vision 2040’s focus on economic diversification and creating a business-friendly environment attracts foreign companies, many of which leverage outsourcing services. The emphasis on logistics and transportation infrastructure creates opportunities for outsourcing in areas like supply chain management, warehousing, and distribution. Investments in education and training programs help to build a skilled workforce, which is essential for the outsourcing sector to thrive.
Oman Vision 2040 lays the foundation for a robust outsourcing sector by promoting economic diversification, investing in key sectors, and fostering a skilled workforce. As Oman progresses towards its 2040 goals, outsourcing is poised to play an increasingly important role in driving economic growth and competitiveness.
Outsourcing as a Strategic Move for Oman’s Growth
Oman’s growing embrace of outsourcing isn’t a coincidence; it’s a strategic response to the evolving global business landscape and the country’s own ambitious development goals. Several compelling factors are driving Omani businesses to increasingly leverage external expertise and resources.
Accessing Specialized Skills
In this rapidly changing world, businesses need access to a wide range of specialised skills to stay competitive. That explains why a whopping 92% of G2000 companies outsource their IT services. Outsourcing provides a gateway to a global talent pool, allowing Omani companies to tap into expertise in areas like IT, engineering, finance, and customer service, often at a lower cost than hiring full-time employees.
Improving Efficiency and Productivity
Outsourcing allows businesses to streamline operations, improve efficiency, and focus on their core competencies. 57% of companies outsource to improve efficiency and productivity. By delegating non-core functions to specialised providers, companies can free up internal resources and dedicate more time and energy to strategic initiatives.
Reducing Costs
Cost optimization remains a major driver of outsourcing. By leveraging cost-effective labour and infrastructure in other countries, businesses in Oman can reduce operational expenses and improve their bottom line. Interestingly, cost reduction is the primary reason for outsourcing for 45% of companies.
Accelerating Digital Transformation
As Omani businesses embrace digital transformation, outsourcing plays a crucial role in providing access to the latest technologies and expertise. Outsourcing providers can help companies implement cloud computing solutions, adopt data analytics tools, and enhance their cybersecurity posture. Did you know 70% of companies are using outsourcing to help with digital transformation initiatives?
Supporting SMEs
Outsourcing is particularly beneficial for small and medium-sized enterprises (SMEs) in Oman. Globally, 24% of SMEs outsource to increase their operational efficiency. It allows them to access specialised skills and technologies that might otherwise be out of reach, enabling them to compete with larger players and expand their operations.
What’s the Final Takeaway?
For businesses looking to optimise operations, reduce costs, access specialised skills, and drive innovation, Oman presents a compelling case. Whether it’s leveraging the expertise of established BPO providers or tapping into the growing pool of tech talent, Oman offers a gateway to achieving strategic goals and gaining a competitive edge in the global marketplace.
The message is clear: Oman is not just open for business; it’s open for outsourcing. As the country continues its journey towards Vision 2040, the outsourcing sector is poised for continued growth, making Oman a destination worth watching for businesses seeking strategic partnerships and sustainable success.
Also Read: Saudi Arabia’s Outsourcing Market Growth Forecast for 2025
