INCREASING acceptance of outsourcing appears to have benefited the Philippine business process outsourcing (BPO) industry as client companies focus on cost-saving and productivity-enhancing measures. Clients are also outsourcing more complex processes, increasing the value of services offered by the industry, according to the results of a recent industry forum and a related survey.
BPO executives attending an industry briefing and survey respondents alike are overwhelmingly optimistic in their forecast for the next 12 months. Close to 80 percentof BPO companies see expansion of between 6 percent and 80 percent in their workforce in the next 12 months. “Our previous survey showed a return to optimism in the industry. The current survey shows that sentiment achieving momentum,” said Oscar Sañez, Business Processing Association of the Philippines (BPAP) chief executive.
The range of services offered by the industry has continued to expand beyond process-based services to more complex, judgment-based services, a trend observed in successive quarterly surveys. Back-office; information technology, data and software; and knowledge-based processes in finance, medicine and legal services are among the increasing number of high-value offerings provided by respondents’ companies. In all, respondents’ companies are engaged in delivering services in more than 20 sectors.
Greater optimism in the regulatory and business environments is expected to raise the Philippines’ profile as a stable investment location.
Respondents also identified potential hurdles to expansion. The tight labor market and corruption are still viewed as top investor concerns. Almost 60 percent of respondents cite labor as a primary, secondary and tertiary concern. Developing and retaining capable middle managers was also identified as an emerging issue. As BPOs continue to shift to increasingly complex services, labor concerns are expected to intensify.
Government corruption has consistently ranked high in terms of risk associated with doing business in the Philippines, and 35 percent of respondents cited corruption as their top three concerns.
Competition from emerging BPO centers has become a bigger threat, due in part to aggressive marketing campaign efforts. Up-and-coming centers in Africa, Latin America and Asia, such as Egypt, Costa Rica and China have increased concern over the competitiveness of the Philippines.
“While the outlook is positive, the industry is realistic about potential threats,” said Gillian Joyce G. Virata, BPAP executive director for information and research. “Respondents appear not to take the outlook for granted and remain vigilant.”
Source:-http://businessmirror.com.ph/index.php?option=com_content&view=article&id=597:outsourcing-gains-approval-helps-boost-bpo-optimism&catid=24:companies&Itemid=59
