The Efforts To Diversify Our Markets Are Not Driven By President Obama’s Statements About Outsourcing : Gillian Virata, BPAP

Within a short span of time, Philippines has established itself as one of the prominent players in the offshoring and outsourcing (O&O) industry. However, as the industry is becoming more dynamic with each passing day, there are new challenges and priorities for the market leaders, in order to sustain and retain their current market share and position. BPO Voice interviewed Gillian Virata, ” Executive Director for Information and Research, BPAP ” about the future of outsourcing in Philippines and other related issues.Below are the excerpts

How much prepared Philippines is in view of competition coming from upcoming destinations like Eastern Europe, Africa or other Asian countries?

For voice-related outsourced services in English, the Philippines has advantages that will be difficult for countries in these regions to compete against. In terms of a large English-speaking and highly educated population that can provide high-quality voice customer service at low cost–only India can compete with the Philippines. To keep these advantages, the Philippine continues to aggressively invest in
education, training, and recruitment. Investments in telecommunications and real estate will also ensure that these costs will remain highly competitive, if not more competitive in the future.

Having established itself as the premier destination for high-quality voice-related customer service, the Philippines is also aggressively marketing its potential to expand into higher-value voice and non-voice
services including more complex services. With a large pool of finance and legal accountants and decades of experience in American financial and legal systems, we are well-placed to succeed in expanding our slice of the market in these higher-value sectors. We are also diversifying our market base.

Could you share the main highlights of the roadmap 2010?

The four main initiatives outlined in our road map for 2010 are: talent development, Next Wave Cities, business environment, and Team 2010.

For talent development, the road map provides strategies for increasing employment in the IT-BPO industry to enable us to capture 10% of the global IT-BPO market. Initially, it was estimated that this would require hiring up to a total of 900,000 to 1,000,000 employees. Current estimates are lower because productivity has risen, that is, each employee can generate more revenues than originally estimated.

The Next Wave Cities initiative addresses the issue of concentration of the industry in Metro Manila by producing information for investors wanting to locate in other cities; it also helps companies tap the large graduate and employee pool outside of Metro Manila.

Initiatives to improve the business environment for IT-BPO companies in the Philippines include investor assistance, awareness campaigns, risk perception management, government interaction, regulatory environment management, etc.; these efforts aim to nurture and maintain a pain-free, efficient, and stable operating environment for IT-BPO companies in the Philippines.

Finally, setting up and providing resources for a dedicated full-time team of professionals to manage the industry’s initiatives is a commitment of industry and business leaders to ensure the industry’s robust growth.

What are BPAP immediate priorities?

Talent development is BPAP’s top priority. This includes managing government subsidies for training, linking the academe and industry through programmed English-proficiency training programs, management training, efficient competency assessment, and awareness of the industry as a provider of good professional growth. Other priorities are external awareness of Philippine capabilities in key and new markets; and ensuring the Philippines’ cost and productivity competitiveness.

There has been a popular notion that Philippine Outsourcing industry would target Europe after Obama’s so called protectionist measures. What’s your take on it?

We are keeping track of political developments in all target markets that may affect outsourcing. However, the efforts to diversify our markets are not driven by President Obama’s statements about outsourcing. Rather, they are based on basic business fundamentals such as increasing market capture and spreading risk by diversifying markets. We believe that we can offer many markets, especially English-speaking markets, opportunities to improve their business operations with services provided by our highly skilled workforce and we think they should be aware of this.

How much do you think would US’s protectionist measures affect the business in general?

I have not seen any precise figures on how protectionism has affected business. There was a marked slowdown in business in the second half of 2008 into 2009; however, this was probably more a result of the financial crisis. News releases indicate some outsourcing and offshoring has stopped for protectionist or nationalist reasons but it’s difficult to gauge how much in relation to other reasons.

Tell us something about your upcoming event “International Outsourcing Summit”

The Global Financial Crisis may be the most visible economic development affecting the BPO and other industries, but it is not the only major potential threat. Populist political rhetoric against outsourcing is on the rise, as is protectionist sentiment in many countries.

On October 20 and 21, 2009, the Business Processing Association of the Philippines (BPA/P) will conduct a major international conference, “International Outsourcing Summit: Global Market Leaders Addressing
Global Issues,” to provide a venue for global BPO executives to discuss these issues and other threats and opportunities emerging for the industry. The conference will feature speakers and panelists from
country associations and industry leading BPOs the world over.

For these two days in October, top global industry executives will debate the future of BPO and provide insights into how the Global Financial Crisis and other factors are not merely affecting the industry, but reshaping it.

About Gillian Virata

Executive Director for Information and Research
Business Processing Association of the Philippines (BPAP)
Gillian is responsible for BPAP’s research service line which involves providing industry statistics and information to the public. Tasks include the publication of annual industry statistics on talent pools, IT-BPO revenues and employment, and the resulting benefits to the country. The research team will also take charge of compiling the Next Wave Cities™ scorecard and annual risk report and the latest industry trends.

Gillian has extensive professional experience in world-class research with reputable institutions and has been educated in reputable institutions in the Philippines and the United States.
• Research Consultant with the World Bank and the Asian Development Bank on social development issues in developing countries
• Senior Business Communicator for Stakeholder Relations, Ayala Corporation
• Executive Director, C. Virata & Associates
• University of the Philippines, AB Philosophy (Magna Cum Laude)
• Columbia University, MA Education
• George Washington University, Master in International Policy and Practice

About BPAP

Business Processing Association of the Philippines (BPAP), a private-sector led organization representing sectors of business process outsourcing and IT-enabled services industry in the country, serves as the one-stop information and advocacy gateway for the various sectors of contact centres; back-office outsourcing; medical and legal transcription; software applications, development and maintenance; animation; engineering and design delivery services; and other allied support services.

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