In five years time, the Philippines is to beat India as the leading back office solutions provider for voice-based customer support and sales. This is according to experts, whom have been on the lookout for the major growth and chances in the Business Process Outsourcing (BPO) industry.
According to reports made by Harsimran Julka of the Economic Times, companies like Cisco, T-Mobile, HSBC, and BT Group are moving their outsourcing work to Southeast Asian Nations from their current locations in India. This is due to the high staff turnover experienced by companies in India.
Apart from the high staff turnover, other key factors that prompted this shift are the availability of skilled workforce, higher tax incentives, continuous support from the local government, and strong affinity with the American culture.
By the end of the year, India is expected to generate $5.58 billion worth of revenues on voice-based services alone. According to Everest and the Business Process Association of the Philippines (BPAP), this is comparatively lower than the Philippines expected $5.70 billion revenue turnout for 2010.
If this continues, it is possible for the Philippines to beat India as BPO hotspot, surpassing India’s $12.4 billion BPO industry in five years. Records for the last two years indicated that the Philippines were able to make a Compounded Annual Growth Rate (CAGR) of 27.6%, boosting the BPO industry at $9.5 billion. On the other hand, India recorded a CAGR of 11.92 percent for the said timeframe.
Evidences of this growing capacity of the Philippine BPO industry is the presence of various outsourcing providers in the country. Prominent companies such as BT and Cisco have already established their support hubs in the country. Major cities in the country have also become home to some of BPO’s biggest industry leaders in India such as EXL, Accenture, and IBM.