Tags: Outsourcing
By Alexander Villafania
PASAY CITY, METRO MANILA – European industries could start looking to outsource their operations in an effort the stem the effects of the ongoing regional economic crisis, a positive sign for service providers in the Philippines.
The European crisis has some similarities with that of the global financial crisis that started in the US in the late 2007 to early 2010. During those years, while many industries floundered, outsourcing took the opposite route and actually grew significantly.
In what seems to be a repeat of such a trend, European firms could face some problems unless they start looking to improve their costly operations.
While being careful about the potential feedback from European industries, the outsourced contact center industry in the Philippines remain conservative especially since it has established the company as an outsourcing hub.
In the last couple of years, more European firms are starting to take outsourcing as a potential problem-solver
In an interview, Contact Center Association of the Philippines (CCAP) President Benedict Hernandez noted that for some years, clients of domestic contact center firms have gradually included non-US companies.
While about 70 percent of voice and non-voice services go to the US, another 20 percent are going to other English-speaking countries like New Zealand, Australia, Great Britain and some main European countries.
Hernandez said that while the number of non-US companies remains small, the forecast is positive especially as traditionally conservative European firms look for outsourcing services.
This can be attributed to open market forces and the need to expand business beyond borders to ensure continued financial viability. With physical expansion to new markets comes the need to improve back office and frontline infrastructure.
“Maturity and openness of new markets are drivers to outsourcing. The level of confidence for non-US markets to outsource is increasing. Be it crisis or not, these companies will be cutting down on costs and be more focused on ensuring business continuity,” Hernandez said.
An added incentive to sell to European markets is the fact that only a few European industries are familiar with the Philippines and its capabilities. Along the lines of learning what outsourcing is, the knowledge of the Philippines having a solid infrastructure to speak of is drawing the attention of European firms.
Assuming that there would be a repeat of growth due to demand from new European markets, Hernandez revealed that the Philippines is more than capable of handling a deluge of outsourced work. He noted on several human resource programs that the CCAP and the umbrella organization the Business Process Outsourcing Industry (BPAP) have started.
One of these is a curriculum training program in partnership with some colleges and universities that prepares would-be outsourcing workers for work after graduation. Similarly, President Benigno Aquino III unveiled a P500 million program to give additional train near-hires to accommodate the needs of the outsourcing industry.
“We have 400,000 workers in the contact center industry, up from 345,000 last year. In the next five years, this could reach to 800,000. There’s plenty of work to be done but we’re ramping our manpower to accommodate it.”
And while growth figures remain conservative (15 percent growth rate), Hernandez said that a lot could still happen in the coming years. “We’re still conservative with our growth. Of course, growth can happen where you least expect it.”
Related stories:
Contact center biz in PH to grow double by 2016
How can the Philippines remain successful in outsourcing?
Outsourcing firm seeks more Filipinos with ‘leadership qualities’
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