Report

Exploring the Value Proposition for Impact for Impact Sourcing

Through its Poverty Reduction through Information and Digital Employment (PRIDE) work, The Rockefeller Foundation has been learning about the potential effect of impact sourcing on the lives of the poor and vulnerable worldwide.

This feasibility study, undertaken by Accenture Development Partnerships with the support of The Rockefeller Foundation, seeks to examine the demand side of impact sourcing from the perspective of the buyers of outsourcing services, and determine whether it can be a viable business model. It aims to provide evidence that big businesses, such as large outsourcing companies like Accenture, as well as smaller ISSP players, have an integral role within impact sourcing and can realize significant benefits from such initiatives. Specifically, it offers guidance on scaling initiatives and provides a set of pilot options that outsourcing companies might consider if interested in developing impact sourcing as part of their core business offering. The current outsourcing market is estimated at $512 billion.

While the majority of outsourcing services are delivered from India, a growing number of outsourcers are establishing delivery centers or otherwise sourcing labor from other low-income locations, such as The Philippines, Mauritius and Brazil. Other emerging markets, including Kenya, Ghana, Rwanda, and Uganda, have included outsourcing in their national growth strategy. These countries are most likely to benefit economically and socially from sustainable job creation and growth. At the same time, Asia, Africa, and Latin America will account for 97 percent of population growth over the next 20 years, making the developing world the largest source of potential future employees.

One of the greatest issues facing developing countries is a growing population in need of employment. Countries with rapid growth rates are experiencing a “youth bulge”, with young people entering the workforce forming a significant percentage of the population. To employ youth entering the workforce and help decrease unemployment among the young by 50 percent, over 700 million jobs will need to be created by 2020.

Gartner forecasts that business process outsourcing and technology outsourcing will grow to $574 billion by 2015. Based on forecasts from Avasant, impact sourcing is predicted to make up 11 percent of the business process outsourcing market in 2015. One Potential Solution impact sourcing is one potential solution to the issues and opportunities present globally today. By providing previously unavailable employment opportunities to talented resource pools through impact sourcing, individuals, businesses and society benefit from harnessing untapped skills.

This feasibility study focused on answering the question of whether impact sourcing is a viable business model for large outsourcing companies such as Accenture, and for smaller ISSP counterparts.

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