Industry group says inconsistent LGU rules driving away IT-BPM investors

INCONSISTENCY in local government rules may drive away investors in the information technology and business process management (IT-BPM) sector, an industry group said.

IT and Business Process Association of the Philippines (IBPAP) President Jack Madrid said investors are still facing constraints, particularly at the local government unit (LGU) level, when setting up shop in the country.

“What is damaging is when these rules, which are mostly well written, are interpreted in different ways by different cities. And this is where it gets challenging because I think we have perfectly fine laws and regulations, and where the problems come from is in differing and inconsistent interpretations,” he told reporters at the IBPAP’s Industry Rebrand Launch on Tuesday night.

Mr. Madrid said investors in the IT-BPM industry are “very compliant corporate citizens.”

“They want everything in writing. And when they did their due diligence in deciding to invest, they accepted the rules as written and will comply with them,” he said.

However, Mr. Madrid said LGUs sometimes have different processes for the renewal of local business permits, with some even connected to the health certificates of employees.

Due to the different interpretation of the rules, he noted some IT-BPM companies are even meted penalties for failing to comply. He said these incidents are reported back to the companies’ head offices, which in turn affects the image of the country.

“It’s really quite complicated, but it’s unfortunate that we have to deal with this. The good news is that it doesn’t happen in many, many, many cities; it only happens in one or two,” Mr. Madrid added.

The National Government finds it hard to address this issue, as it cannot do much at the LGU level, he said.

“So, you know, we will not stop trying to intervene. We will not stop talking to our senators and congressmen who are willing to listen,” Mr. Madrid said.

The IBPAP on Tuesday unveiled the IT-BPM industry’s rebranding strategy, as it seeks to change public perception about IT-BPM jobs and to show that the industry offers viable careers.

Mr. Madrid said the rebranding stems from the industry’s need to address existing issues such as the lack of talent.

“We have a talent issue in the industry, and part of our roadmap indicates that with the maturity and transformation of the industry, the public’s perception and image of the industry haven’t quite caught up with all the changes and growth,” he said.

“I feel that the industry is under appreciated and as a result of that, maybe we are not getting quite the best talent that our industry deserves,” he added.

Mr. Madrid said the industry needs to focus on the talent supply first before addressing the challenges concerning investors.

“We need to address the talent supply challenge first through skilling and rebranding, widening the talent supply pipeline, and then we can resume our work of attracting investors to the Philippines,” he added.

Under its roadmap, IBPAP is targeting to grow the industry headcount by another 7% to 1.84 million employees and reach $40 billion in revenues in 2024.

“It is a very big and ambitious number. But you know the numbers I’m sharing with you are the aggressive numbers of our Roadmap 2028,” Mr. Madrid said.

He said that the Philippines should continue to fight to get a bigger share of the global IT-BPM market and defend its place as the second top IT-BPM destination.

“This is really quite a pivotal time in our history, amidst all the challenges. It’s not just India anymore that is looking at getting a piece of our market share. Countries like South Africa, Colombia in South America, Vietnam, Poland, and even Egypt are becoming known as IT-BPM destinations,” he said.