Moving Up the Outsourcing Chain

Philippines being on the top of virtual contact center business, is moving up its competency to the next level to become the global leader in multilingual business process outsourcing (BPO).

The managing head of the Board of Investments Cristino Panlilio, said the agency has partnered with IBM in a bid to cash in on the Philippines’ multilingual talents as more and more companies, particularly from Europe and Asia-Pacific, expand outsourcing activities.

IBM itself will be the biggest catcher of those multilingual talents as it plans to fill in 3,000 more jobs over a one-year period. And IBM currently has 10,000 workers in the Philippines. IBM has the largest contingent of multilinguals with more than 200 local and cross-border talents supporting 15 languages, this number is expected to double in three years.

The number of local multilingual talents in the Philippines is three times the number of foreign multilingual talents and that number is growing by 8.7 percent annually. Aside from an already rich pool of multilingual talents from the BPO sector itself, the DTI said other sources of multilingual talents include the academe, government and the hospitality industry.

According to Panlilio, a training facility will be set up at the Ortigas Center. On the academic side, the partnership hopes to increase the quantity and improve the quality of graduates proficient in Nihongo, French, German and Spanish.

OFWs will be encouraged to return and practice at work the language they have learned abroad. There is also an initiative to simplify and integrate processes and policies on work permits for foreign nationals and visa applications for local talents going on knowledge-transfer abroad.

According to the project brief, there is a need to develop a research and development program focusing on multilingual capability since growth markets are in Europe and Asia Pacific. Today, multilingual talents in the Philippines mostly handle non-sales activities such as on customer services, document analysis, technical support and teaching.

Today, our local BPO business supports over one million client employees in 15 languages from Manila and provides global support to 84 countries in North and South America, Asia and EMEA, all delivered in their natural time zones. IBM’s capabilities and best practices in multilingual BPO business, coupled with strong and strategic cooperation from the BOI, will further establish the Philippines as an upcoming leader in the global multilingual BPO arena.

The Philippines continues to lead the global IT and BPO evolution with a strategic engagement with IBM that will cement the position of the country as a center of excellence in multilingual BPO. What we are witnessing is an acceleration of our country BPO industry service offerings that would help attain our industry targets of creating 1.3 million jobs and $25 billion in revenues by 2016. This is also part of BOI’s commitment to further reinforce our reputation as a preferred destination for niche BPO services.

Higher growth and more opportunities for the BPO industry in markets such as the UK. Over the past decade, the Philippine BPO industry has grown to achieve $11 billion revenues and employs close to 526,000 people. These numbers show that the industry is a major contributor to exports.

The briefing was organized by the founding members of the British Philippine Outsourcing Council and the Philippine Trade and Investment Center. The Philippines was the recipient of the Offshoring Destination of the Year Award by the UK’s National Outsourcing Association in 2007, 2009, and 2010. Britain is one the Philippines’ top markets in the European Union. Exports amounted to $395 million in 2010. Industry data also showed total investments from Britain amounting to $146 million last year.

Under the proposed Philippine Export Development Plan, services exports which include IT and BPO are expected to increase their market share to 24 percent by 2016. The British Philippine Outsourcing Council, an organization based in the United Kingdom, provides outsourced services to the Philippines.

PAL Hires PLDT for their Call Center Operations: A Win-Win Situation!

The whole idea of outsourcing jobs has created much stir in the business environment. However, it works on the basic principle that one man’s loss is another’s gain! Whether it be the loss of jobs in America, which created great opportunities in outsourcing destinations or whether the recent Philippines Airlines(PAL) decision to hire Philippine Long Distance Telephone Co. (PLDT) for their call center operations, along with other catering and many other airport services!

This massive contract will save PAL P1.5 Billion a year and bail them out of a tough financial situation, but at the same time will affect 300 PAL employees who will lose their jobs as a result of this deal. However, about 600 new positions will spring up at PLDT where these ex-PAL employees will be given the first preference! This, unlike other outsourcing options will work out to be very convenient where new jobs will be created and kept within the country.

The Philippines should promote more such deals which are a win-win situation for both the parties involved. The government will also welcome such deals and is sure to grant some benefits to similar deals in the future. PAL could have also shipped their jobs to a foreign location but made a wise decision by awarding the project to PDLT. Philippines has a great workforce and is one of the big players in the call center industry. Cheap labor, the main reason for which jobs are outsourced is available here in abundance!

The labor union of PAL, known as PAL Employees’ Association (PALEA), has taken stiff opposition to this contract. The job cuts are not something they are happy about and they have filed a notice to go on strike. They definitely need to see this in a broader perspective and understand the wonderful implications that deals such as these will have on the economy of Philippines.

Australian BPO Company in the Philippines and its Effect on the Call Center Industry

Seeing the entire furor that the Philippines call center industry is creating in the world, Australian firm, Salmat, could not stay away from it all. Salmat, the Australian business process outsourcing firm, recently announced that it will be opening up its operations in the Philippines. It is expected to open up an establishment in McKinley Hill in Taguig City, paving way for an 800 seat facility. This is touted as one of the first investments of the company outside Australia. The new establishment is expected to cater to accounts from Australia and New Zealand, while they switch between voice and non-voice services. The company is further expected to expand into areas like web content management, call centers, IT enabled services, data entry and computer programming. All this is bound to have a positive effect on the Philippines BPO industry.

Over the past few years, the Philippines has seen a major growth in terms of attracting investors and clients willing to the country’s call center industry’s abilities. When it comes to knowledge-based positions and workers, the Philippines is being touted as number one throughout the world. Being just one place behind India in terms of employer preference, the Philippines is fast growing and expanding its services to provide more expert-knowledge and services to the clients. With the Australian firm coming to the Philippines call center industry, the Philippines is sure to become even more widely recognized throughout the world for catering high-end business processing outsourcing. Already, the projected earnings of the call center industry is expected to contribute to 6% of the total GDP of Philippines. The next ten years have further projected the total revenues to increase up to US$100 billion from the call center industry alone. With so much to offer, the number of jobs and total household income too will increase exceptionally, thereby changing the entire outlook of the nation.