The business process outsourcing, or BPO, industry has been one of the Philippines’ most successful and innovative sectors of the community. Its contribution to the country’s economic growth is unimaginable. BPO has also helped lessen the number of unemployed Filipinos, a problem that has been long on the list of the Philippine Government.
Despite critics who belittle those who worked in these companies, the BPO industry continues to thrive, and its numbers are increasing rapidly. In this article, HTC News will explore the BPO industry and why it is thriving in the Philippines.
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Business Process Outsourcing or BPO Industry, What is it?
When you ask anyone who doesn’t work or knows what the BPO industry is in the Philippines, they will answer, Call center.
So, what exactly is the Business Process Outsourcing or BPO industry? It’s a strategic partnership between two entities—the original company and the outsourcing company. The original company entrusts certain operations and responsibilities to the outsourcing company, creating a mutually beneficial arrangement.
In this partnership, the original company initiates a contract with the outsourcing company, entrusting them with specific operations and responsibilities. One critical area that outsourcing companies manage is the customer service function for large corporations.
A considerable percentage of outsourcing companies handle customer service, which is why most of those who don’t know what an outsourcing company is would tell you it’s a call center firm.
Customer service is just one of the many services that BPO companies provide. They also handle accounting, human resources, marketing, and sales.
History of Business Process Outsourcing in the Philippines
We can say that the history of Business Process Outsourcing here in the Philippines has a rich and bountiful story. It solved the rising number of unemployed Filipinos due to their lack of educational attainment in college and universities. It gave them a chance to prove themselves, even without a college diploma.
The BPO industry in the Philippines began its journey in the early 1990s. It was Frank Holz who established the first contact center here in the Philippines, the Accenture Global Resource Center, and the rest is history. A vast number of foreign companies followed in the footsteps of Holz; one of them is People Support Incorporated, a Los Angeles-based outsourcing company that started making a name in the Philippines in 1998. They provided sales and customer service support for e-commerce sites.
Introduction of Philippine Economic Zone Authority or PEZA
Because of the rapid growth of the BPO industry in the Philippines, former president Fidel V. Ramos saw this as an opportunity for the Philippines to have a win-win scenario. He introduced PEZA in February 1995.
This served as a way for the Philippines to receive tax breaks and infrastructural support as an incentive for the Philippine government. Its sole duty is to reach out to more foreign investors. Its success is still seen today as PEZA zones continue to expand, giving foreign outsourcing companies economic benefits while helping the Philippine economy grow.
Why is the BPO industry Booming in the Philippines?
There is no question as to why the BPO industry is having the time of its life in the Philippines. Here are a few reasons why it became a corporate giant in the country:
Workforce friendly
When it comes to hiring employees, the Philippines is quite picky in general. They require many things and set high standards, which some unfortunate Filipinos who were not able to get a college degree fail because of poverty.
The BPO industry opened its doors for them, giving them the opportunity to prove themselves. Filipinos are smart and hardworking; opportunity is all they need. Statistically, the number of undergraduate Filipinos is above average. Some of these numbers are employed in the BPO industry, making it more successful than ever.
Cost efficient
Investing in the Philippines with a business process outsourcing company is cheaper than in other developed countries, where expenses and wages are expensive. In the Philippines, investors can get the same quality output in customer service, sales, IT services, and other outsourcing services at a cheaper price.
Proficient in the English Language
There is no doubt that Filipinos are among the best races to speak English. Because of this, foreign countries find it easy for them to teach and communicate, which leads to business success.
Government support
Another reason why the BPO industry is thriving in the Philippines is the government’s support. As mentioned above, PEZA gives them benefits and freedom that other countries don’t offer.
Top Business Process Outsourcing Companies in the Philippines
1. Accenture
2. Sourcefit
3. IBM
4. Convergys
5. Sykes Enterprises
6. Infosys BPO
7. Sitel
8. TeleTech
9. Tech Mahindra
10. Tata Consultancy Services
The Philippines BPO Age Will Continue to Grow
Because of the success of the Business Process Outsourcing or BPO industry, these corporate companies will continue to grow in the coming years. As long as PEZA is around, these giants will continue to thrive as one of the country’s most prominent investors and employers.
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