Hexaware Positioned as a Visionary in the 2026 Gartner® Magic Quadrant™ for Custom Software Development Services
Hexaware Positioned as a Visionary in the 2026 Gartner® Magic Quadrant™ for Custom Software Development Services
Gartner, Magic Quadrant for Custom Software Development Services, By Jaideep Thyagarajan, Ryan McKinney, Nathan Davie, 28 September 2026. Gartner and Magic Quadrant are trademarks of Gartner, Inc. and/or its affiliates. Gartner does not endorse any company, vendor, product or service depicted in its publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner publications consist of the opinions of Gartner’s business and technology insights organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this publication, including any warranties of merchantability or fitness for a particular purpose. This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the context of the entire document. The Gartner document is available upon request from Hexaware.
Business process outsourcing (BPO) involves transferring the responsibility for a specific business function or process to a third-party provider. The core business process outsourcing definition has evolved; initially, the focus of BPO was on reducing costs through labor arbitrage but modern BPO has evolved to include the use of advanced technologies—such as automation, artificial intelligence (AI), generative AI (GenAI), agentic AI, machine learning (ML), and data analytics to deliver faster, more efficient, and innovative outcomes.
The benefits of business process outsourcing are numerous. BPO providers manage the people, processes, and technology involved, driving both operational efficiency and strategic business goals. By streamlining and modernizing processes, BPO services providers help businesses become more resilient, adaptable, and innovative, enabling them to launch new services quickly and maintain a competitive edge. Additionally, BPO can drive profitable growth through improved productivity, faster time-to-market, and access to specialized expertise.
The process begins when an organization identifies a specific business function as a candidate for outsourcing, often to improve performance or reduce costs. The company then develops a request for proposal (RFP) and evaluates potential BPO providers to find the best partner. Once a vendor is selected, they enter a contracting phase to finalize terms, pricing models (like fixed-price or time-and-materials), and establish a service-level agreement (SLA) that defines measurable performance metrics. This is followed by a transition phase, where the work and resources are carefully migrated to the provider. Finally, a governance framework is established for ongoing management, performance monitoring, and continuous optimization of the outsourced process.
Common business process outsourcing examples include:
There are several types of business process outsourcing, based on delivery models, geographic locations, and service scope:
Business process outsourcing risks can include data security and privacy concerns, loss of direct control over processes, vendor lock-in, hidden costs, and compliance/regulatory exposure—particularly when operations cross jurisdictions. Other risks are potential quality degradation, cultural or communication gaps, and geopolitical or continuity risks that can affect service delivery. Mitigation measures commonly used by BPO providers and clients include rigorous vendor due diligence, clear SLAs and exit clauses, strong encryption and data-controls, thorough compliance checks, and phased transitions with pilot programs. Proper governance and transparent performance reporting further reduce many business process outsourcing challenges and risks.