BPO firms lured outside Metro Manila

December 30th, 2009 by Rahul Jain Leave a reply »

The Philippine government is luring investors in Business Process Outsourcing (BPO) to disperse out of the metropolis into the top “10 Next Wave Areas,” composed of Iloilo, Metro Laguna, Metro Cavite, Davao, Bacolod, Pampanga Central, Bulacan Central, Cagayan de Oro, Bulacan South and Lipa.

However, some like Iloilo, are running out of developed space.

“We are now one of the best known BPO centers in the world, ranked second after India as global BPO destination. We want to bring work where the talent is,” stressed Business Process Association of the Philippines (BPAP) Executive Director Atty. Ma. Jamea S. Garcia.

“The primary factor for BPO growth is talent,” she explained. The problem is, 80 percent of the talent is in Metro Manila but the metropolis only produces 20 percent of the country’s IT graduates. “All BPO activities in the Philippines are concentrated in Metro Manila. In India, they are dispersed. We are encouraging BPOs here to do the same.”

The main draw for new wave cities like Iloilo is its human resources, observed Bayan Telecommunications Inc.’s Vice President for Business Chito Franco. This city of 1 million turns out 20,000 graduates per year, of which 5,000 are IT graduates.

“Iloilo is the center of education in the Visayas. We have 8 universities, so students from Negros and as far as Mindanao, migrate here. They fly in direct and prefer to study here instead of studying in Manila to save on cost. That’s also why even the BPO locators in Bacolod put up job fairs here. They are sourcing their manpower in Iloilo.”

Oveall, the local offshoring and outsourcing (O&O) industry hauled in $7 billion revenue last year. In 2010, the sector targets to corner 10 per-cent of the global market. However, to achieve this, it needs to hire 1 million new employees.

“While Filipino talent was a positive factor in making us a preferred O&O destination, the focus on building in the NCR areas has limited the universe for human resources,” Franco reiterated.

To complicate matters, “We have problems with the attitude of local investors although we don’t have problems with telecom or power infrastructure,” Iloilo Federation for Information Technology (IFIT) Acting Chairman Jessraf S. Palmares lamented. Locators adopt the attitude that they will only build if they are sure a locator will take the space. And now, “Iloilo has run out of space.”



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