The Philippines as an Outsourcing Destination

28 Aug 2019

For more than 25 years, the BPO industry has become synonymous with the Philippine economy. What started out as a business venture in the 1990s grew into a multi-faceted, multi-billion dollar industry. Just 10 years ago, the industry was already generating revenue of over $9 billion and by 2020, it is predicted that revenue will reach $55 billion. Within that same decade, outsourcing in the Philippines has consistently ranked as one of the best countries for offshoring, occasionally being cited as the number one outsourcing destination. In terms of providing talent, skill and quality, outsourcing in Manila is considered among the best providers in the world and continues to be the leader in customer service and business management.

To understand this further, it’s best to look at the BPO industry as a whole and how Manila remains the country’s most definitive location for anyone looking to offshore.

Brief History and Recent Developments

It’s widely accepted that outsourcing “started” in the Philippines in 1992 with the establishment of Accenture as the first-ever contact centre.  Three years later, the Philippine Congress passed a bill providing tax incentives for foreign investors called the Special Economic Zone Act, enticing them to invest in the Philippines. Since then, numerous BPO companies have made their mark in the Philippines, with a few becoming close to household names. By 2005, The Philippines had a 3% share of the Global BPO market. In 2017, it was reported that the market share had risen to 10-15%.

According to the most recent Tholons report, the Philippines saw plenty of changes in its status as an offshoring destination. Despite a few cities dropping out of the Top 100 destinations, the country still remained within the top five destinations globally. More importantly, Manila is still considered to be the second-best supercity in the world when it comes to providing quality BPO services.

Why the Philippines?

Companies that have adopted offshoring will tell you that the talent pool of the Philippines is one of the best to work with. In most cases, this means working with a team based out of Manila. As the capital city of the Philippines, Manila has first access to all the latest technologies, strong infrastructure and some of the best people that make up different teams. These are several reasons why companies choose to offshore to the Philippines, but more specifically to Manila.

Reduced Costs

When you think of the reasons why companies offshore, cost reduction is always the most common one. Indeed, working with a team in Manila means that local, operational and labour costs are decreased, as well as overhead. Working with a quality offshoring provider means they will ensure your team is provided with an exceptional workspace with all the needed amenities, equipment infrastructure. At the same time, the output quality of work from teams in Manila remains consistently high. Companies get more “bang for their buck” when they see their teams deliver on their objectives at a fraction of their local cost.

High English Literacy

For many Filipinos, English can be considered their second language and are naturally adept at it. Many Filipinos also profess their love for many English songs and also have a habit of watching American TV shows. Many of the country’s top universities found within Manila have English in their curriculum as well. This influence has had an impact on the country as a whole. The Philippines is considered one of the most proficient English speaking countries in the world.

According to the latest data from the EF English Proficiency Index, the Philippines is the second most English proficient country in Asia, just behind Singapore. Globally, it remains one of the Top 15 countries with high English proficiency.  This command of the English language makes establishing professional rapport easier and the completion of processes much smoother.

Filipino Work Culture

Much of what has been discussed can be boiled down to how Filipinos approach their professional lives. Being hardworking, patient, resourceful, and good-natured are just some of the “distinctly Filipino” traits that make up their work ethic. The close bonds they create in the office helps shape an ideal working environment where everyone feels at home.

Closely knit teams in the Philippines are irreplaceable assets for many companies.

Unlike work culture that is focused on individualism, Filipino work culture is all about getting things done as a group and working together to get the results needed. It’s almost no wonder why many offshore teams are efficient when collaborating with local teams in achieving either short or long term business objectives.

The Future of Outsourcing to the Philippines

The Philippines continues to find growth and success through the BPO Industry, with Manila leading the way. As more destinations around the Philippines open up to the industry –thus greatly benefiting the whole country – Manila remains the first choice for many companies that want to consider offshoring.   Having a team in Manila means working with a dedicated multi-talented team that has access to all the latest technologies and infrastructure you need.

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