Top Business Process Outsourcing in the Philippines

 Whatever the size of an organisation the outsourcing business process outsourcing (BPO)  is a strong trend. In the year 2010 60% of CEOs at global enterprises believed that BPO played a very important function in helping business models (Forbes Insights Survey). Nowadays, almost all businesses have outsourcing of some or all of their operations. Oxford Business Group predicts that in the next two years, the global business-process outsourcing market will reach $250 billion. Business process outsourcing in the Philippines is responsible for between 10 and 15 percent of the world's BPO market, where the local BPO sector has grown at a compound annual rate of 10% over the last decade. The Philippines has also always been placed among the top five outsourcing destinations around the world.

 

Datamark has ranked Philippines the top BPO country in 2016 due its consistent expansion. Tholons ranked Philippines third in the 2017 TSGI Top 20 Digital Nations. The index assesses the quality of locations, ranks them and offers strategies for governments, countries companies, agencies as well as multinational corporations, and investors. Tholons considered digital innovations and changes as factors that determine the viability and competitiveness of countries and cities for the first time ever.

 

The Philippines' BPO sector is the largest private employer in the country with a total of 1.3million direct jobs as of 2017. It is anticipated to reach 1.7 million over the coming years. Despite a slowing of BPO growth investors from all over the globe continue to travel to the Philippines to expand their business or establish new ones.

 

 

What is Business Process Outsourcing?

Business process outsourcing refers to the contracting of a third-party company or professional to perform specific tasks and operations that are traditionally done within the company. BPO can be carried out locally, nationally or offshore. Businesses can outsource non-core tasks like back office work as well as highly-specialized technical services (data analytics, to consultancy) from high-skilled and technical companies.

 

Manufacturing firms were pioneers in outsourcing business processes, hiring external service providers to handle important parts of their supply chain. Global BPO was born out of the Internet and the global advancements in telecommunications. Companies could easily hire workers from countries that paid low wages.

 

In the early days control was a key issue for companies. Many executives were worried about assigning critical jobs to those who were located on opposite sides of the globe. This concern has been addressed by outsourcing providers through innovative management strategies and oversight strategies.

 

The globalization of technology and its advancement continue to impact the way businesses operate around the world. The same is applicable to the BPO industry, service providers, and BPO workers. BPO is in constant evolution. BPO is today a key strategy for a lot of businesses.

 

Although effective BPO campaigns are still able to reduce costs however, senior executives and veterans have learned to focus on the business, not only the bottom line. Managers are evaluating BPO projects on the basis of the long-term and short-term value to business such as improvements in productivity, technology, agility and satisfaction with customers.

BPO services are divided into two categories: back office and front-office activities. Back office is the part of the office where employees don't communicate directly with clients. Popular back office BPO services include finance, accounting, human resources, and IT.

 

Because the work is not considered core competency, it is possible to outsource it from the back office. Back office BPO offers many benefits, including lower labor costs and overhead costs, as well as rent, increased productivity, and accessing critical talent that isn't readily available in the local workforce.

 

Front office outsourcing refers to outsourcing of client-facing activities like contact center services. Some organizations consider customer service to be core business activities, but it is still one the most sought-after outsourcing services. This is why many people are familiar with BPO with offshore call centers. Due to their low labor costs and large pool of talent, India and the Philippines are top of the line in outsourcing voice services around the world for decades.

 

Outsourcing Opportunities

 

The Philippines was once a predominantly agricultural country, but the focus has been slowly shifting to manufacturing and services. This has led to more opportunities for entrepreneurs as well as expanded job opportunities. Because of the low cost of labor and the low cost of living and the talent pool which includes English-speaking people, foreign investors consider Philippines as a desirable location for outsourcing offshore.

The Philippines provides a variety of possibilities to outsource. While artificial intelligence is likely to replace lower-skilled BPO positions, more mediumand high-skilled jobs are likely to be created as long as the workforce is continuously improving its skills. From the beginning, government support was strong in the BPO business. Today, both the government as well as the private sector work together to ensure industry expansion. They offer training programs and similar programs that take advantage of the advantages of AI and automated.

The Philippine Development Plan by the government has the BPO sector essential to the country’s ten top priority areas for development. Government programs to promote investment include tax exemptions and tax holidays, as along with simplified trade procedures.

Outsourced Voice and Non-Voice Services

BPO Call Center Industry in the Philippines

India is no longer the world's largest call center capital to the Philippines. Call center firms are continuing to grow in terms of quality of service (with a focus on the customer experience across channels) delivery as well as scope of work technology. BPO companies are being set up in this region by companies from all corners of the globe. BPO expansion will be boosted by new investment promises from European and Asian Pacific companies. Voice will continue in its upward trend, according to economists.

Non-Voice Segment of Outsourcing Industry in Philippines

While the voice services segment continues to generate the most revenue, the non-voice segment (healthcare back office, health care software development, game development, animation and other services based on knowledge) is rapidly catching up. The non-voice sector is expected to grow because of the increased demand for higher-level skill.

What makes BPO one of the industries that is growing fastest in the Philippines?

There are numerous reasons why companies decide to relocate their processes from India or offshore to the Philippines.

Culturally compatible

The success of any outsourcing project is dependent on the ability to communicate between local staff and customers. The staff who is outsourced must possess a an understanding of local culture and language proficiency. This is an area where Philippines surpasses other outsourcing locations.

Low prices

The low cost of business is the main reason for outsourcing in any developing country. The Philippines also offers a wide variety of products and services, including rental offices, professional services and office equipment, food, lodging, and other services. The Philippines is less tax-exempt and health care costs than other developed countries.

Staff Highly-Skilled and Highly-Educated

Each year each year, the Philippines welcomes around 3 million more graduates from its top-of-the-line higher education system into the workforce. In addition, Manila offers a strong professional certification system and continuing education. You can find staff with virtually any specialization within the Philippines.

Economic growth and stability

The Economist has published a report on The Philippines that highlighted positive developments and hints at stability and continued economic growth.