This IDC study is an overview of the major business process outsourcing (BPO) contracts signed in 2005 in the U.S. market for the four key horizontal functions of customer care, human resources, finance and accounting (F&A), and procurement. Per IDC observation, these segments have driven the greatest activity and interest in BPO during the past year. This study presents the vertical distribution of these BPO contracts, investigating the BPO adoption trends and drivers characterizing different industries and identifying those vertical markets that are at the forefront of BPO adoption in these four horizontal markets.

"As the BPO market moves forward steadily, a handful of industries continue to drive the majority of spending on key horizontal BPO services," said Romala Ravi, director, BPO Services. "Responding to mounting pressures around cost reduction and greater operational flexibility, companies in the manufacturing, government, and services sectors led the adoption of the BPO engagement model. At the same time, companies in these industries are moving fast along the BPO adoption curve and increasingly mapping their BPO pursuits to more strategic drivers beyond cost and operational efficiencies."