In the past ten years, the Philippines has been at the forefront of the global outsourcing revolution in which the country led in providing call center services to clients all over the world. The Philippine outsourcing industry has expanded to include a wide array of services that, in 2009, helped yield a 19% revenue increase. The year-end numbers for the Philippine outsourcing industry in 2009 was $7.2 billion, with as much as $5 billion coming from the contact center of voice BPO space alone.
Today, the Philippine outsourcing industry has successfully carved out a niche as one of the world’s best contact center destinations, as its core competencies lie in its educated, English-speaking and culturally aligned workforce. As the industry is continuously evolving, Philippine outsourcing is also developing its services to include more value-added BPO capabilities and knowledge process outsourcing (KPO) expertise.
“From scratch with only 2,000 workers and US$24 million in revenues in 2000, the Philippine [outsourcing industry] has grown into a global powerhouse,” President Gloria Macapagal-Arroyo said on her opening speech during the 10th e-Services Global Sourcing Conference in February 2010. “From revenues of more than $7 billion last year, the [Philippine outsourcing] industry is expected to exceed $9 billion by the end of 2010.”
With knowledge process outsourcing (KPO) slowly proliferating in the country, the Philippine outsourcing industry can now cater to more specialized workforces that include at least 8,000 nurses and 14,000 caregivers, all of which we were previously exported labor market. The Philippine outsourcing industry enables these health care workers to find jobs locally and won’t have to go overseas to bring home the bacon.
More than just healthcare, the Philippine outsourcing industry is also expanding to cater to more industries such as information technology. In fact, James Dantow believes in the highly competitive talent that the Philippine outsourcing has to offer. Dantow is the vice-president and worldwide support and general manager for the Manila operations of online integrated business applications software and services firm NetSuite One World.
“When NetSuite began looking for an Asian location, I pushed for the Philippines because I knew the high caliber of the local IT talent pool,” Dantow said in an interview with IT World Canada. He added that Philippine talent he encountered is characterized by their high level of technology and non-tech education, their English proficiency and their natural affinity to North American culture and business practices.
He further points out another important factor in the corporate decision to offshore or outsource, saying “Low labour cost is not enough reason for foreign businesses to invest offshore. Outsourcing must bring the best value for the money as well.”
With that in mind, the Philippine outsourcing space is moving to provide customer value to more industries and clients all over the world.
In the next couple of years, the Philippine outsourcing space is expected to grow. One BPO organization that already announced their expansion is Infosys BPO Ltd., which plans to increase their employee base to 3,000. In fact, Chief Operating Officer Ritesh M. Idnani announced that the company is already in talks for building a new facility to host expanded operations. The company has 13 delivery centers worldwide, three of which are in the Asia-Pacific region. The Philippine outsourcing space of Infosys alone handles seven companies, generating as much as 8% to 10% of the reported $316.2 million in revenues for the fiscal year 2008-2009.
Through Infosys, the Philippine outsourcing space will include more specialized workers, as the company will be providing knowledge process outsourcing (KPO) services as well. Idnani told the Business Mirror that “legal process outsourcing is the fastest-growing practice for the company and we are looking for upwards of 700 lawyers.”
In 2009, the Philippine outsourcing industry employed as much as 442,000 individuals and generated as much as $7.2 billion, representing a 19% increase over 2008’s ending numbers. This year, with KPO continuously expanding, the Philippine outsourcing space is expected to earn $9 billion over a 26% growth.