This year investors are considering around five to seven cities across the Philippines as potential key locations for business process outsourcing (BPO) companies, most of which are outbound and inbound call centers. This is according to the Commission on Information and Communications Technology or CICT. This will increase the total number of the country’s cities hosting outbound and inbound call centers from 35 in 2009 to more than 40 this year.
Most outbound and inbound call centers in the Philippines are concentrated mainly in the big cities within Metro Manila and in the bigger metropolis like Cebu City in Central Philippines. For example, many outbound and inbound call centers are operating out of Makati, Ortigas and Quezon cities in the Philippines’ capital.
The problem is the availability of many call center jobs are contributing to high rates of employee attrition as skilled workers can easily move from one company to another. The competition among outbound and inbound call centers to attract and retain highly skilled employees has driven up costs. As a result investors are now considering other places to set up outbound and inbound call centers. These new locations are known as the next wave of cities for the BPO industry.
Last year the next wave of cities for outbound and inbound call centers included Metro Laguna and Metro Cavite, and Lipa City in Batangas, all located south of Metro Manila. Bulacan East and Bulacan West are also emerging cities north of the country’s political capital. Other new cities that attracted outbound and inbound call centers were Iloilo Bacolod City in Central Philippines and Davao and Cagayan De Oro in Mindanao.
CICT Commissioner Monchito Ibrahim declined to name the specific cities to be included in the list, saying instead that the goal was to achieve a 65-35 percent ratio for BPO investments in the country by year-end. That is, the CICT is hoping to locate 35 percent of outbound and inbound call centers outside Manila while reducing the share of Manila-based BPOs to 65 percent.
At present 75 percent of inbound and outbound call centers are based in Metro Manila. “Ideally we want a 50-50 percent ratio,” Ibrahim told ABS CBN News. “But that might take another two to three years to accomplish.”
To be considered as a potential location for outbound and inbound call centers a city must meet all the requirements needed to attract BPO investments. Investors looking to put up outbound and inbound call centers in a new city use a scorecard that includes infrastructure and high speed internet connection.
The size of local talent pool available in the area is also an important factor in setting up an outbound or inbound call center in a particular location. A well-trained, English-speaking population makes a city an ideal option for companies looking for alternative location for their outbound and inbound call centers.
The challenge is finding ways to attract more investors to locate outbound and inbound call centers in new wave cities, according to Laguna ICT Council President Antonio Del Carmen. He said Sta.Rosa in Laguna, with more than 5,000 seats this year, expects a 15 percent to 20 percent increase as more companies dial up their investments there. Places that are aspiring to become Next Wave Cities for outbound and inbound call centers should focus on improving the manpower to meet the demand from the firms, Del Carmen added.
Jose Mari Mercado, Director for Business Development at Convergys, identified close working relationship between the public and private sectors as a critical issue when scouting for new locations for their outbound and inbound call centers. Government grants to upgrade IT and transport infrastructure is a good sign. In addition, Mercado said the presence of ICT councils is equally important.