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The Philippines Phenomenon in BPO in 2016

Wilma C. Inventor-MirandaTHE Philippines is the country to watch out for in 2016 as it draws business process outsourcing (BPO) services into the country due to its low cost of living and a workforce which composed mostly of young, educated and English-speaking people.  This is based on the list of outsourcing trends by Datamark in their Ask the Experts, Outsourcing News dated December 10, 2015.  They placed in the No. 1 trend to watch out for as a top outsourcing destination, the country Philippines.  The country replaced Mumbai in 2015 in the 2nd top ranking BPO destination and will continue to shake the Top 10 worldwide outsourcing destinations (dominated mostly by Indian cities) in 2016.

The country should be prepared for this phenomenal growth by providing the right infrastructures, continuous supply of quality people to work in the industry, and keeping up with the trends in processes such as the gradual popularity of service delivery automation which includes robotic process automation (RPA).  There is also the need to provide more knowledge process outsourcing which is a higher form of BPO services because it needs expertise in certain fields such as in accounting, legal, engineering or even in marketing because the demand for KPO services is also expected to increase in 2016 with the market expected to expand at a combined annual growth rate of 23 percent in 2019.

Personally in my experience in the industry, one area which the country should also address is one which is often overlooked.  The psychological and physical wellness of the people especially those working in the call centers.  Most of these call centers operate on graveyard shifts and it has been noticed that some fresh graduates shy away from applying in these centers because of the working hours which could be affecting their health not only physically but psychologically as well.

There is a need for these companies to provide care for the psychological and physical welfare of their people such as conducting seminars or advisory/counselling on physical wellness and emotional health, physical activities such as a gym or membership in a gym, nutritional awareness and monitoring the right foods served in the canteen or pantries, group bonding aside from the technical trainings.  I am sure certain companies are already doing this, but this concern cannot be overemphasized.  To attract more people in the industry, a campus talk for career orientation for students should be conducted addressing students concerns in working in a BPO environment although there are already courses in colleges and universities preparing students for BPO work.

The 2015 edition of the Organization for Economic Cooperation and Development (OECD) Outlook for Southeast Asia, China and India forecasted that the Philippines and Indonesia will lead the continuing growth of the ASEAN economies until 2019.  This was included also in the article of Deloitte in its 2015 Competitiveness Report highlighting the fact that it is also the first time in the publication of the 2015 OECD edition that the Philippines had the best growth forecast among the ASEAN-5 countries.

But the same report also mentioned that among these countries the Philippines spent the lower percentage of its GDP on infrastructures – an average of 2.2 percent compared to the average of 5.5 percent among the neighboring countries from 1980 to 2009.  However, the current government administration is trying to turn this around to 4 percent of GDP with the aim of increasing it to 5 percent in 2016.

With the gap in BPO workers in Manila, the improvement of infrastructures connecting the lagging town to growth centers, will certainly help in the availability of workers to address the gap aside from the government support for remedial training and educational reforms.  The government had provided substantial funding for training in key sectors and support Service Management Programs in schools and with the improvement in infrastructures, not only will the BPO sector be helped but also the other sectors as well such as the manufacturing, export, real estate sectors, etc.

The growth in the BPO sector remains to be bullish for 2016 and in the Deloitte’s report it expects the industry to hit its target of $25.5 billion and 1.4 million people employed by then.  The sector contributes to 6 percent of the GDP growth and the Philippines should be prepared with these bright prospects by providing full government support even if it is set to open the local project for foreign companies to hasten the infrastructure improvements.

The world is looking at the Philippines with its exciting prospects in 2016 and with the change of leadership there is a mixed feeling of excitement and fear.  However, we are all hoping the change will further help improve the industry and the over-all economy and not halt or hamper it.  I am keeping my fingers crossed and encourage all Filipinos to vote wisely so that the gains will not take a step backward instead of forward and will continue to place the Philippines in esteem and in the bright spotlight in the global economy.

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Wilma Miranda is the chairman of the Media Affairs Committee of Finex; treasurer of KPS Outsourcing Inc.; and managing partner of Inventor, Miranda & Associates, CPAs.  The views expressed herein do not necessarily reflect the opinion of these institutions.

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