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March 08, 2012

Philippines' BPO Industry Leaders Warn Outsourcers to Remain Competitive
By Tracey E. Schelmetic
TMCnet Contributor

When you're at the top, there's always someone happy to spend time and resources to try and take your spot. When it comes to call center outsourcing, there's no question that the Philippines is now at the top, having toppled India, once the world leader for business process outsourcing (BPO). There's also no question that other regions would like to take the crown away from the Philippines.

Regions hoping to steal market share away from the Philippines aren't very far away, and include nations such as Malaysia, Singapore and China, according to the Business Processing Association of the Philippines (BPAP). Then there's India, which would be happy to regain its top BPO location status.

“There are over 100 locations around the world where IT [information technology] BPO services are being offered,” BPAP head of research and industry veteran Gigi Virata said at a recent press conference. “While we have our lead in voice services, we have to be more competitive in higher-value services,” she said.

Though the nation's BPO industry has been wildly successful, the Philippines shouldn't rest on its laurels, say government officials, who have emphasized the need for BPO firms to diversify into more complex services if the sector is to sustain its rapid growth, according to the Philippines' Inquirer Business. New service areas BPO companies should consider include back-office functions such as accounting tasks and the management of human resource systems that many corporations, in a bid to cut costs, have started to subcontract to offshore companies.

While the Philippines has built its dominance in call center outsourcing for voice services, speaking English with accents preferable and more comprehensible to North Americans won't cut it with non-voice services.

“It’s a very competitive world out there,” Virata said. “We encourage companies to be more efficient. They have to be more productive and they can’t just keep cutting costs by reducing salaries. What you have to do is improve systems to identify redundancies, and come up with innovative ideas for better customer service,” she said.

One way, she said, is to eliminate redundancies in call center or other processes, which would reduce the need to keep salaries low, allowing companies to retain the best talent while keeping costs competitive.

Edited by Rich Steeves


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