Ro­bust and gear­ing for the fu­ture

Business World - - SPECIAL FEATURE - Ph, In­dus­try.gov. An­thony T. Valentin Fran­cis

THE BUSI­NESS process out­sourc­ing (BPO) in­dus­try of the Philip­pines, de­scribed by Ox­ford Busi­ness Group (OBG) in its “The Re­port: The Philip­pines 2017” as “an eco­nomic pow­er­house” and “one of the largest white-col­lar em­ploy­ers in the coun­try,” has been thriv­ing on a con­flu­ence of fa­vor­able fac­tors. “It ben­e­fits from over a decade of pro-in­vest­ment gov­ern­ment poli­cies, a young and well-ed­u­cated work­force, and ris­ing for­eign in­vest­ment in both third-party con­tact cen­ters and global in-house call cen­ters (GICs),” OBG says.

The first fac­tor the re­search firm men­tioned – pro-in­vest­ment gov­ern­ment poli­cies – is par­tic­u­larly im­por­tant. Ac­cord­ing to

a Web site of the Depart­ment of Trade and In­dus­try and Board of In­vest­ments that aims to serve as the cen­tral por­tal on in­dus­try poli­cies, pro­grams and ini­tia­tives af­fect­ing ma­jor sec­tors of the econ­omy, the Philip­pine gov­ern­ment is pro­vid­ing the in­for­ma­tion tech­nol­ogy and busi­ness process man­age­ment (IT-BPM) in­dus­try with one of the best in­vest­ment en­vi­ron­ments so that they it can op­er­ate pro­duc­tively.

“For in­stance, the Board of In­vest­ments (BOI) pro­vide[s] in­come tax hol­i­days, tar­iff re­duc­tions in cap­i­tal equip­ment and stream­lined busi­ness reg­is­tra­tion and co­or­di­na­tion pro­ce­dures for non-voice and knowl­edge process out­sourc­ing en­ter­prises which pro­duce orig­i­nal con­tent. The Philip­pine Eco­nomic Zone Au­thor­ity (PEZA) also pro­vides an in­cen­tives pack­age for IT-BPM busi­nesses, in­clud­ing voice-based ser­vices in its scope of qual­i­fied in­vestors. Aside from bet­ter co­or­di­na­tion pro­ce­dures with gov­ern­ment, IT-BPM en­ter­prises ben­e­fit from a sound telecom­mu­ni­ca­tions in­fra­struc­ture in the coun­try as well as a sta­ble pool of skilled pro­fes­sion­als in ur­ban cities, where the pop­u­la­tion base is grow­ing at sta­ble re­place­ment rates. These con­di­tions as­sure that busi­nesses can con­duct their ac­tiv­i­ties within a sta­ble macroe­co­nomic and in­vest­ment cli­mate,” the site says.

Cit­ing data from IBM’s “Global Lo­ca­tion Trends 2010” re­port, OBG notes that the Philip­pines has been the leader in global voice and call cen­ter ser­vices since 2010. “That year, data from the Con­tact Cen­tre As­so­ci­a­tion of the Philip­pines (CCAP) showed em­ploy­ment in the in­dus­try reached 350,000 against 330,000 in In­dia, while seg­ment rev­enues stood at $5.7 bil­lion that same year ver­sus $5.5 bil­lion in In­dia,” it says. OBG adds, “Fig­ures have since in­creased to 686,000 Filipinos em­ployed and $11.7 bil­lion in rev­enue in 2014. The in­dus­try, which also in­cludes cus­tomer sup­port, soft­ware de­vel­op­ment and fi­nan­cial ser­vices, has risen to be­come one of the fastest­grow­ing sec­tors in the coun­try in re­cent years.”

In 2016, the rev­enue of the IT-BPM in­dus­try came in at $22.9 bil­lion, and the num­ber of em­ploy­ees work­ing in it to­taled 1.15 mil­lion, OBG notes. The re­search firm says US ource, a small group pro­vid­ing clients with out­sourc­ing needs, ex­pects BPO rev­enue to more than dou­ble, reach­ing $55 bil­lion in 2020.

The In­for­ma­tion Tech­nol­ogy and Busi­ness Process As­so­ci­a­tion of the Philip­pines (IBPAP), which serves as a one-stop in­for­ma­tion and ad­vo­cacy gate­way for the in­dus­try, has cre­ated a road map for ac­cel­er­at­ing the growth of the IT-BPM in­dus­try un­til 2022.

“The Philip­pine IT-BPM Roadmap 2022 is all about ac­cel­er­at­ing the growth of the PH IT-BPM in­dus­try - strength­en­ing do­main ex­per­tise and ca­pa­bil­i­ties in the emerg­ing sec­tors, lev­er­ag­ing ad­vance­ments in tech­nol­ogy and en­sur­ing the Filipino tal­ent is fu­ture ready. As we see rapid in­no­va­tions in the ar­eas of dig­i­tal trans­for­ma­tion, ar­ti­fi­cial in­tel­li­gence, big data and an­a­lyt­ics and evolv­ing de­liv­ery mod­els, it is im­per­a­tive that the IT-BPM In­dus­try evolves with the chang­ing de­mands of the mar­ket to re­main com­pet­i­tive and main­tain its po­si­tion as a des­ti­na­tion of choice for IT-BPM Ser­vices,” the as­so­ci­a­tion says.

Among the spe­cific goals iden­ti­fied in the road map are the fol­low­ing: gen­er­a­tion of 1.8 mil­lion di­rect jobs, 7.6 mil­lion di­rect and in­di­rect IT-BPM em­ploy­ment and 500,000 jobs out­side of the Na­tional Cap­i­tal Re­gion; in­creas­ing in­dus­try rev­enue to $40 bil­lion; and cap­tur­ing a 15% share of the global IT-BPM mar­ket.

Tech-driven changes might stand in the way of achiev­ing the job tar­gets, though. In a Busi­nessWorld re­port pub­lished last month, the Con­tact Cen­ter As­so­ci­a­tion of the Philip­pines (CCAP) has re­it­er­ated push to re- skill em­ploy­ees to pre­vent job losses that new tech­nolo­gies that can per­form low-end jobs may cause. “To be able to keep jobs, to main­tain growth lev­els of the in­dus­try, and to fur­ther build more jobs, we need to re- skill peo­ple,” In­fosys BPO Philip­pines Coun­try Head Ma. Rhodora Cam­pos was quoted as say­ing in a state­ment.

In a sep­a­rate state­ment, Jojo Uli­gan, pres­i­dent of CCAP, said, “We need to con­tinue the ed­u­ca­tion, the part­ner­ship, the col­lab­o­ra­tion so ev­ery­body will un­der­stand ex­actly what we need to do as an in­dus­try, as a coun­try to be able to cap­ture the growth and to be able to cap­ture new po­ten­tial busi­ness op­por­tu­ni­ties.”

Still, OBG re­mains pos­i­tive. “Although ris­ing lev­els of au­to­ma­tion and ad­vance­ments in ro­bot­ics and ar­ti­fi­cial in­tel­li­gence pose a threat to low-level BPO jobs, strength­en­ing de­vel­op­ment ties be­tween in­dus­try and academia should see growth in high-value-added BPO po­si­tions over the medium term,” the firm says. —

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