Business process outsourcing in the Philippines

Business process outsourcing or BPO is an emerging industry in the Philippines.

Overview

Main article: Business process outsourcing

The business process outsourcing industry in the Philippines has grown 46% annually since 2006. This boom is led by demand for offshore call centers. Industry estimates from the Board of Investments, Business Process Association onf the Philippines (BPA/P) and BPO Services Association (BSA/U) put the number of people employed by the BPO sector by end of 2008 at 435,000 (vs 372,000 in 2007)- excluding the non-BOI/ non-PEZA entities. The BPO output for 2008 was US$ 6.1B (vs US$ 4.5B in 2007), putting the Philippines as the 3rd largest BPO destination (15%) after India (37%) and Canada (27%). It was expected to hit US$ 7.2B to 7.5B in 2009. The industry was optimistic of 18% growth in headcount 2009.

Overall, Philippine BPO is forecast to earn between US $11 to 13 billion and to employ 900,000 additional people in 2010. To achieve and sustain this growth, the Philippine government offered fiscal and non-fiscal incentives to attract foreign direct investment in these industries as part of the 2007 Investment Priorities Plan. The IPP was prepared by the Board of Investments (BOI), as the lead agency in promoting investments, focused on the sectors identified in the Medium-Term Philippine Development Plan (MTPDP) 2004-2010 (PBOI 2006).

Majority of the BPO facilities are located in First Tier cities in Metro Manila and Cebu. Second and Third Tier sites are located in regional areas such as Bacolod City, Baguio City, Cagayan de Oro, Clark (Angeles City), Dagupan City, Davao City, Tacloban City, Dumaguete City, Lipa City, Iloilo City, Legazpi City, Iligan City, Olongapo City and Urdaneta City.

Call Centre Industry in the Philippines

Main article: Call center industry in the Philippines

In the Philippines, call centres or call centers actually began as plain providers of email response and managing services. The call center industry comprises 80% of the outsourcing industry in the country. With 80% of the services provided going to the US market.

The Philippines has less expensive operational and labor costs, as well as an English-speaking workforce as a result of English being one of two official languages. English is also one of the major subjects in all educational levels. In 2008, The Philippines remained a top BPO destination with an estimated $12-billion in revenue business process outsourcing industry. By 2011, Philippines has beat out India for the top BPO destination in the world.

Legal and medical transcription

Main article: Medical transcription

Medical transcriptionist

These companies do mostly medical reports, discharge summaries, operative reports, therapy/rehabilitation notes, chart notes, and hospital and clinic reports using software and equipment for the U.S.

In 2003 there were only 9 companies registered doing medical transcription in the Philippines. In 2008 there were 43 companies registered.

Finance, logistics and accounting

The Philippines is becoming a regional and global hub for shared corporate backroom operations, especially for financial services such as accounting and bookkeeping, account maintenance, accounts receivable collection, accounts payable administration, payroll processing, asset management, financial analysis and auditing, management consulting, inventory control and purchasing, expense and revenue reporting, financial reporting, tax reporting, and other finance-related services such as financial leasing, credit card administration, factoring and stock brokering; as well as for logistics management, and cargo shipment management.

Software Development and Animation

Fueling the recent growth spurt in the outsourcing industry in the Philippines are more higher-end outsourcing services such as Web design, software development, and animation (Shameen 2006).

Filipino animators do well in the global market for animation, which is growing due to the increasing popularity of animation as an entertainment medium not just for free and cable TV and the movies but also for computer games, as well as an advertising medium, a graphics medium for Internet content, and an information and educational tool.

Major studios like Disney, Marvel, Warner Brothers and Hanna Barbera have offices in the Philippines (CNN 1995). Some of the latest works of Filipino animators include scenes in Pixar's Finding Nemo, Paramount Picture's Barnyard and Twentieth Century-Fox's Anastasia (ABS-CBN Interactive 2004).

See also

• Call center industry in the Philippines
• Cyberservices
• Philippine Cyber Corridor
• Offshoring
• Outsourcing
• Call center
• Outsourcing of animation

References

• Beshouri, CP, Farrell, D & Umezawa, F 2005, Attracting More Offshoring to the Philippines, The McKinsey Quarterly, 2005 No. 4, viewed 18 March 2007.
• Business Processing Association Philippines 2006, ITES & ICT Sectors, viewed 18 March 2007
• CNN.com 1995, Filipino animators in 'toon' with the times, viewed 18 March 2007
• Inquirer.net 2007, BPA/P taps McKinsey for BPO roadmap 3 March 2007, viewed 22 March 2007
• McKinsey 2005, The Philippines' Offshoring Opportunity, McKinsey & Company, viewed 18 March 2007
• Namasivayam, S 2004, Profiting from Business Process Outsourcing, IT Professional, January–February 2004, pp. 12–18.
• National Outsourcing Awards 2009, Offshoring Destination of the Year - Philippine Trade & Investment - Philippines
• Philippine Board of Investment, Business process outsourcing, viewed 1 October 2010
• Philippine Department of Trade and Industry 2003, META Group cites RP as Asia’s ‘Bright Spot’ for outsourcing, viewed 18 March 2007
• Shameen, A 2006, The Philippines' Awesome Outsourcing Opportunity, BusinessWeek Online, viewed 11 February 2007
• The Epoch Times 2005, Philippine Call Center Boom Outgrows Manila, viewed 18 March 2007
• Academia, BPO setup Philippine viewed 22 January 2012