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News : Philippines Risks Losing Voice BPO Leadership
March 31, 2014 -- Experts have warned the Philippines that while it currently leads in the business-process outsourcing (BPO) industry, especially in the voice segment, it could lose to other emerging destinations worldwide because of complacency.
Richard Mills, Chalre Associates Executive Search founder and chairman, said the Philippines remains "No. 1" in the call-center category and continues to "do very well" in the back-office space.
"It’s a very exciting time for the Philippines, which has come from nothing in a very competitive industry [like the BPO]," said Mills, who is also chairman of Asia CEO Forum, during the recent First Annual Noda Contact Center Forum 2014 held in Makati City.
But he said the outsourcing sector was "changing tremendously," and the Philippines must "charge ahead," as there are new potential destinations that could take over its premier status, as it did to India a decade ago.
Mills said the Philippines could possibly lose its leading position to Africa because of that continent’s huge young population, similar time zone with Europe, nearness to North America, including French, German, English and Dutch.
Since outsourcing is highly dependent on reliable network and connectivity, he noted, in particular, Nigeria’s new telecommunications line and some developments now taking place in Zimbabwe that BPO locators might find attractive.
"All these things are happening [in this] fastest-growing region in the world. And they are a lot less expensive," Mills said.
He noted that Time magazine recently cited a new group of emerging economies—PINE, which stands for the Philippines, Indonesia, Nigeria and Ethiopia.
Contact Center World (CCW) Association President Raj Wadhwani said South Africa is also "a force to reckon with" from the same continent.
"We hold Global Awards every year, and we see that South Africans are very active in terms of best practices. Their people are very good and passionate in the service perspective," he said.
The CCW top executive also found that some Central American nations, such as Costa Rica and Guatemala, as well as Eastern European countries, were likely rivals of the Philippines in the North American marketplace.
The latter group, according to him, is also keen on penetrating deeper into the growing contact-center sector within their own territory, which is, likewise, the domain of the Philippines.
Among the European players, Ireland and Poland are seen competitive not only in the voice but also in other sectors, as the cities of Krakow and Dublin made it to the last two spots on Tholons’s 2014 list of Top 10 BPO destinations in the world.
But CBRE Philippines Vice Chairman Joey M. Radovan remains upbeat for the Philippines. He previously said the rivals cited were still not in "close competition" with the Philippines, given that Manila and Cebu consistently claim the upper second and eighth spots in the report, accordingly.
"But I think we have to be careful," Raj reiterated.
"The industry is changing. We could see these jobs came quickly here could just as quickly start to move somewhere else. So it’s a big concern. Unless we’re taking action immediately now to make sure that we keep as many of these [jobs] as possible," Mills added.
For the Philippines to retain its No. 1 status in the contact-center segment, the industry experts all agreed during the forum that it needs to respond to business concerns in terms of the call centers’ operational efficiency, implementing new technological developments and raising the skills level of the agents.
According to Noda Interaction Platforms Chief Executive Officer Andrey Zaitsev, the continued success of this nation on the global voice- outsourcing market is dependent not on low costs of the work force, but on the quality of the services and how well resources are used and expenses streamlined.
"There are two main success drivers: the first is highly qualified management that pays fixed attention to boosting call-center efficiency and streamlining expenses, while also boosting income at the same time. That, coupled with next-generation IT [information-technology] solutions, enhances performance by automating all major business processes," he said.
The Information Technology and Business Processing Association of the Philippines (Ibpap), for its part, is helping improve educational support for call-center workers to support better current accounts and accommodate future market needs.
Ibpap Executive Director for Talent Management Penny Bongato cited, for instance, the organization’s Service Management Program, which is a minor subject taught in the college level, to prepare the students before entering the BPO industry.
"Critical thinking is important because we know that the voice will continue to grow. But the other sectors are also growing: health care, finance and accounting, among others. A lot of companies are coming here; thinking of setting up their shared services. And we’re very happy about that. But we need to make sure that we have the talents to supply the demand," she said.
Posted by Veronica Silva Cusi, news correspondent
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Published: Tuesday, April 1, 2014