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BPO Philippines: Why it makes sense

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The growth of the Philippine BPO industry has been incredible.

What started as a fledgling group of companies in the dawn of the new millennium has turned into a vast network of businesses that are an integral part of the financial services landscape in Manila.

With close cultural affinities with the West, excellent infrastructure and a highly skilled, yet low-cost labour, force, the country has been able to attract a huge number of companies to their shores.

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Photo by Glenn Carstens-Peters on Unsplash

Over the past two decades, the Philippines has emerged as one of the world’s leading BPO destinations.

“When people think of business process outsourcing to the Philippines, they typically think of call centres.

This is not without reason, the majority of the work that is outsourced is call centre-related. But it is important not to ignore the other services that are also being provided”, says Ralf Ellspermann, CEO of PITON-Global, a leading BPO provider in Manila, Philippines.

Deutsche Bank, for example, has moved a part of their business analytics team to Manila, Facebook runs some of their content moderation there, and HSBC houses their fraud monitoring and detection services in the capital.

The exponential growth of the Philippine BPO industry over the last two decades is a testament for its success. As it continues to grow, the workforce has become better trained and more skilled, which creates more opportunities for the industry and clients.

Rather than paying for expensive customer service representatives in London, a company can now have their support done in the Philippines at a fraction of the cost.

Another misunderstanding is that BPO is only for large multinational companies. This was the case in the early 2000s, when organisations such as DELL, Microsoft, AMEX, and Verizon were outsourcing their BPO requirements to third-party providers in the Philippines.

Fast-forward to 2020, and you see companies of all industries and sizes that are now also benefiting from outsourcing their front- and back-office processes to the Southeast Asian nation.

The initial success of Fortune 500 companies has also paved the way for SMEs to outsource their BPO requirements to companies such as PITON-Global in Manila.

The ease of doing business and the low costs associated with outsourcing have enabled programs to range from just a few seats to several thousand seats per client.

This was unimaginable at the start of the decade, but the rapid growth of technology and the decrease in its cost has made it all possible.

“Approximately 50% of our clients are SMEs with outsourcing requirements ranging from 5-30 seats per account. On overage, our UK clients save around 50% on costs compared to onshore BPO vendor rates.

An outsourced team of 20 agents can easily save a company £500,000 per year”, says Ellspermann.

The current pandemic will cause profound changes to the way business is conducted. As companies look to cut back on costs, it is important for management to look beyond the outdated stereotypes of what outsourcing to the Philippines looks like.

One thing is for certain, business process outsourcing to the Philippines is here to stay. Companies in the UK will continue to look for ways to lower costs and improve operating efficiencies.

And as they do, they will continue to outsource their BPO requirements to third-party vendors in the country. There’s little doubt that the BPO industry in the Philippines will overcome the challenges posed by Covid-19 and emerge from it even stronger.