At the end of the 1990s there was hardly any BPO sector in the Philippines. However, from a small start, the fledging sector took advantage of government incentives and exploded in size. Today there are over 800 BPO companies in the Philippines, providing services for businesses in every sector and on every continent.
Over little more than two decades it has become a major part the Philippine economy, generating billions of dollars of revenue. The growth has been so dramatic that BPOs in the Philippines recently passed India, the outsourcing pioneer, to become the world’s largest provider of call centers.
This dramatic growth is a success story in its own right. It stands as evidence of both the quality and cost-effectiveness of contact center outsourcing to the Philippines for anyone considering it. It also brings with it some structural benefits that offer the Philippines a significant competitive advantage.
The first benefit comes from the age of the industry. Although relatively young — the oldest BPO companies would only be in their early twenties — this actually represents a significant lifespan for a business and its employees. There are people who have made a career entirely within the BPO industry in the Philippines, some of whom started in entry-level positions in the late 90s and now hold senior positions.
This brings with it a significant level of institutional knowledge. There is collective expertise within the industry that means there are few challenges that it has not faced and successfully met. And, even if new challenges arise, such as a global pandemic, there is sufficient experience and expertise within the industry to respond effectively and efficiently.
The second benefit comes from the size of the workforce. Over one million people are employed in the BPO sector creating an experienced workforce that can meet the changing demands of clients. A new project can be staffed from existing, experienced staff. This means that BPOs in the Philippines can scale quickly as and when needed.
The third benefit is the size of the industry and the importance this has for the Philippine economy. This has created a mutually beneficial relationship with the government. While the industry received support during its early years with government incentives, by the time of the 2008 financial crash the sector was able to participate in a government scheme to train and employ Filipinos returning from abroad.
This also means that the government continues to create a favorable environment for BPO companies, for example harmonising regulations to help BPO companies in the Philippines win contracts in which they are required to meet western standards.
So while it’s true that any country could start a BPO sector, they would have to work hard, and take a long time, to match the advantages that a vibrant outsourcing industry gives BPOs in the Philippines which they in turn, can pass on to their clients.
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