The Benefits of Outsourcing to the Philippines

The Philippines is rapidly advancing and offers a particularly strong challenge to other more commonly known countries, like India and China, in the business process outsourcing sector. For instance, a research study on the global outsourcing market in 2016 revealed that Manila sits in second place for the biggest outsourcing city in the world. Bangalore, India, is the only city with a larger outsourcing market. Shanghai, China is the first Chinese city that shows up on the list, and that's not until 12th place.

The Philippines saw a 30 percent growth rate over the past decade, according to the Information and Communications Technology Office. The future continues to look promising with Deloitte predicting their BPO market share may increase to 20 percent of the global market with $48 billion in revenue. The Philippines' strong showing in the BPO market comes from the benefits it offers businesses worldwide, particularly in the United States.

Language Neutrality
English is an official language in the Philippines, alongside Filipino. As such, workers in the Philippines have strong English proficiency and are able to provide exceptional support through any channel, whether requiring verbal or written communications. Many have also developed a neutral accent that works well for voice communication, making it nearly impossible for customers to suspect they may be talking to someone halfway across the world. With a common understanding of the same language, your businesses can operate seamlessly between your U.S. team and Philippines-based support.

Strong Education System
You need highly skilled employees to handle specialized BPO tasks and you wouldn't' want the quality of your workforce to differ between your in-house and outsourced teams. With a 95% literacy rate, the Philippines is a great place to meet this demand. The ASEAN Briefing reported that 450,000 Filipinos graduate from higher education institutes every year. Special tuition rates for lower-income students help boost attendance and open up educational opportunities for all socioeconomic demographics.

Classes in the Philippines are typically taught in English. Some schools even offer BPO skills training to help prepare students for this particular industry. Continuing education, remedial skills training and distance learning programs target older workers seeking career changes.

Younger Demographic
The average age in the Philippines is 23 years old, a demographic that has grown up with technology. This population has access to growing BPO training opportunities through independent programs and higher education institutes. They are growing up during a time where the BPO industry is truly flourishing, so they are entering the marketplace well equipped with tools and knowledge to succeed. This peer group recognizes and believes that the BPO industry is one of the best employment options in the country. This also makes them better suited to adapt to the changing needs of the market, remaining agile and flexible so your business can too.

Cultural Influences
The Philippines has a fascinating combination of Southeast Asia and Western influences. English's position as an official language makes it easier to consume Western media. Its history also plays a part in this development as Mexico, Spain and the U.S. all governed this country at various points in its lifetime. U.S. popular culture is well received in the Philippines, so your Philippines-based workforce often times have similar interests, watch the same shows and listen to the same music. While these may be small factors, cultural alignment can play a significant role in the quality of your outsourcing services and experience.

Data Privacy Act
Outsourcing your operations or vital business processes often involves sensitive data, so some companies have shied away from using overseas outsourcing. However, the Data Privacy Act of 2012 brought the Philippines' policies up to international security standards. Personal and sensitive information have strict regulations protecting this data from unauthorized access and usage. More industries, such as healthcare, could use the Philippines as a viable outsourcing destination.

Improved Philippines Economy and Quality of Life
Before the BPO industry rose to prominence in the Philippines, many workers left the country to look for jobs. They didn't have opportunities at home, so they had to leave friends and family behind to make a living. Many people didn't see their loved ones for years at a time, if at all. At this time, the Philippines economy was heavily dependent on foreign remittances sent back to the country, rather than its own domestic industry.

Now the BPO industry provides 1.2 million jobs locally, with another 225,000 jobs projected in 2016. Filipino workers are able to stay in their home country, close to friends and family. The quality of life has drastically improved with these changes, which spills over into the local economy and the overall standard of living. Small business owners see better neighborhood stability as people settle into homes, rather than preparing to leave for overseas jobs.

The Philippines offers many advantages as an outsourcing destination. The combination of native English proficiency, Western cultural acceptance and widespread educational opportunities makes this an attractive prospect compared to other outsourcing destinations. Filipinos make great support teams that mesh well with U.S.-based companies. If your current BPO needs far exceed your resources, we can help you enter the Philippines to help you expand your business.

Sources:

  • http://www.tholons.com/TholonsTop100/pdf/Tholons_Top_100_2016_Executive_Summary_and_Rankings.pdf
  • http://www.ibpap.org/it-bpm-industry-road-map-2016-public-version-download
  • http://www2.deloitte.com/content/dam/Deloitte/ph/Documents/about-deloitte/ph-about-2015-philippines-competitiveness-report-noexp.pdf
  • http://www.aseanbriefing.com/news/2015/10/21/the-philippines-the-new-bpo-capitol-of-the-world.html
  • http://www.peza.gov.ph/index.php/about-peza/special-economic-zone-act
  • http://icto.dost.gov.ph/new-data-privacy-bill-to-bolster-it-bpo-industry/
  • http://www.rappler.com/business/industries/174-outsourcing/121357-bpo-revenues-offset-slump-ofw-remittances
  • http://www.census.gov.ph/content/age-and-sex-structure-philippine-population-facts-2010-census
  • http://www.rappler.com/business/industries/174-outsourcing/125889-information-technology-bpm-bpo-dole-jobs

Valerie Access

July 11, 2016