Business process outsourcing or BPO is an emerging industry
in the Philippines. This industry was regarded as one
of the fastest growing industries in the world. The
BPO boom is led by demand for offshore call centers.
It is estimated that 112,000 people were working in
call centers in the Philippines in 2005, bringing in
revenues of US$1.12 billion for the year. This is a
sharp increase from 2000 when call centers employed
2400 people and earned US$24 million. Overall, Philippine
BPO is forecasted to earn US$13 billion for the year
2010.
This emerging industry in the Philippines is fueled
mostly by customer care, medical transcription, software
development, animation, and shared services. Though
customer care call centers form the largest part of
the BPO boom locally, the Philippines' language proficient
information technology, human resource, and finance/accounting
professionals are a significant contributing factors
as well. The proficiency of many Filipinos in English
and Spanish were major factors in the growth of BPO
in the Philippines.
The Philippines has the largest number of accredited
accountants in Asia, with the number growing yearly.
Filipino accountants are also renowned for their flexibility
in working with multiple accounting standards.
Areas such as Baguio City, Bacolod City, Cagayan de
Oro, Cebu City, Clark, Dagupan City, Davao City, Dumaguete
City, and Iloilo City are being developed for offshore
operations.
The Philippines' Center for International Trade Expositions
and Missions (CITEM) report for 2004 cited the Philippines
as among the top 10 choices for offshore operations.
Major companies that already operate in the Philippines
include AIG, AOL, Barnes & Noble, Chevron, Citigroup,
Dell, HP, HSBC, IBM, Intel, JPMorgan Chase, Motorola,
Procter & Gamble, and Trend Micro. Notable BPO vendors
include Accenture, Convergys, PeopleSupport, and Unisys.
A survey by Kelly Services, Inc. based in Michigan,
showed that India is no longer the first choice of U.S.
companies looking to setup their offshore backroom operations.
The study cited companies eyeing the Philippines as
the better site due to quality. Filipinos enjoy a comparative
advantage over American workers for two reasons. First,
labor costs in the Philippines (with a minimum wage
of approx $7 per day) are a fraction of those in the
United States. Second, most BPO workers in the Philippines
are college graduates. Many overseas labor sourcers
also prefer Filipinos over Indians when it comes to
customer support and customer interaction due to Filipinos'
relative ease and familiarity with American culture
and U.S. slang.
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