Offshoring in the Philippines: Four Key Considerations

16 Feb 2022

Offshoring consistently provides organizations with competitive advantages. It is a strategic approach to take when trying to stand out in a global marketplace. However, your offshore team’s location is also important. While several countries offer offshoring teams, some provide much better benefits than others. This is especially true for those that want to maintain their aforementioned competitive advantage in the global marketplace. One such location is the Philippines. For several decades, offshoring in the Philippines has become the go-to choice for many companies that want to get the most out of its services. 

This isn’t surprising. As a major contributor to the country’s economy, offshoring – and BPOs in general – has strong support from the government. Amidst the global pandemic, offshoring and outsourcing were major drivers of the Philippine economy. A number poised to grow further in 2022. As of today, there are over 1.3 million Filipinos in the BPO industry, spread across over 1000 multinational companies. However, government support is not the only reason offshoring in the Philippines is a good bet. Here are other key considerations to think about.

More Competitive Costing

This is perhaps the initial reason why companies consider offshoring in the Philippines. As an offshoring destination, Philippine BPO providers can offer premium support at half the cost.  Compared to some other countries, the cost of living in the Philippines.  Partnering with the right provider can help organizations incur significant savings. Google, Amazon and Facebook are just some of the global companies that have a home in the Philippines for this very reason.

That being said, this should not be the only primary reason to get into offshoring in the Philippines. As an entire workforce, the Philippines has so much to offer with their skillsets and proper motivation.

Premium Quality of Service

Offshoring in the Philippines means being invested heavily in the team you cultivate. Not just them, but their processes and infrastructure that ensure their services are delivered at the highest quality. A good offshoring provider also knows the importance of investing in a quality management team and proper staff training. They are aware of the competitive edge using the most advanced technologies and facilities can bring to clients who are looking at offshoring seriously.

Investing in the quality of service is also twofold. By investing time and effort into the offshoring process, team performance also develops. They are able to cultivate a top-trained, highly skilled workforce that is ready to take on their client’s objectives. They can also help create an environment that is productive and where everyone can feel motivated and engaged. With the proper tools and processes at their disposal, they are more than ready to deliver world-class customer experiences.

A Highly Skilled Workforce

If you ask any organization that works with a Filipino workforce, you’ll likely hear several glowing reasons why. We mentioned that they are a highly-skilled and motivated workforce that is capable of taking on different client objectives. Part of this comes from their English speaking proficiency. Several Filipinos consider English their first language, giving them the experience and edge when it comes to customer care functions. Their use of English also means they understand cultural nuances and subtleties when interacting with clients from different countries.  

Well-trained offshore teams can take on the objectives of any organization.

Their skills are not just limited to how well they speak English either. Many in the Filipino workforce also hold college degrees and can take on niche roles that organizations often look for. Compounding their knowledge with the motivation and enthusiasm they bring on a daily basis makes them irreplaceable members of any organization.

Consistent Government Support

To understand why BPOs have strong government support, let’s look at a brief history of the industry. Beginning with Accenture in 1992, BPOs in the Philippines has seen steady growth in the last 30 years.  By the mid-2000s, the Philippines held about 3% of the global BPO market. Several multinational BPO companies established themselves and further energized the industry. The Philippine government has long recognized the significance of the BPO industry and continues to enact legislation that supports its growth. Some legislations passed include deregulation of telecoms, more investments in communication infrastructure and providing tax exemptions for operational costs. Within the Philippines, there are also several established economic and business zones for foreign investors looking to establish their foothold in the country.

The legislation passed does not only encompass BPO companies. They’ve also benefited the people within the BPO industry by giving them protection and job stability. Through laws such as the Telecommuting Act, BPO workers have more flexible work arrangements that help them carry out their objectives. As a whole, companies can expect this level of government support should they consider offshoring in the Philippines. 

The Impact of Offshoring in the Philippines

Earlier we mentioned that the Philippine BPO sector now employs over 1.3 million people in over 800 companies. This is just a small indication of how much of an impact the overall industry has on the national economy. In 2019, the industry recorded a revenue of over $26 billion. Despite slowdowns brought by the global pandemic, revenue climbed in 2020 to $26.7 billion and also grew its labour force by another 1.8%. By 2022, revenue is expected to reach almost $29 billion.

Through offshoring and outsourcing, the BPO industry in the Philippines continues to thrive. Their ability to adapt to the latest trends, together with talented teams at the helm will ensure this for years to come. It’s no surprise that companies that want to have a bigger global presence look to the Philippines as a second home for operations.