Business process outsourcing in the Philippines
Encyclopedia
Business process outsourcing or BPO is an emerging industry in the Philippines
.
industry in the Philippines has grown 46% annually since 2006. This boom is led by demand for offshore
call centers. Industry estimates from the Board of Investments, Business Process Association onf the Philippines (BPA/P) and BPO Services Association (BSA/U) put the number of people employed by the BPO sector by end of 2008 at 435,000 (vs 372,000 in 2007)- excluding the non-BOI/ non-PEZA entities. The BPO output for 2008 was US$ 6.1B (vs US$ 4.5B in 2007), putting the Philippines as the 3rd largest BPO destination (15%) after India (37%) and Canada (27%). It was expected to hit US$ 7.2B to 7.5B in 2009. The industry was optimistic of 18% growth in headcount 2009.
Overall, Philippine BPO is forecast to earn between US $11 to 13 billion and to employ 900,000 additional people in 2010. To achieve and sustain this growth, the Philippine government offered fiscal and non-fiscal incentives to attract foreign direct investment in these industries as part of the 2007 Investment Priorities Plan. The IPP was prepared by the Board of Investments (BOI), as the lead agency in promoting investments, focused on the sectors identified in the Medium-Term Philippine Development Plan (MTPDP) 2004-2010 (PBOI 2006).
Majority of the BPO facilities are located in First Tier cities in Metro Manila
and Cebu
. Second and Third Tier sites are located in regional areas such as Bacolod City
, Baguio City
, Cagayan de Oro, Clark (Angeles City), Dagupan City
, Davao City
, Tacloban City
, Dumaguete City
, Lipa City
, Iloilo City
, Legazpi City
, Iligan City
, Olongapo City
and Urdaneta City
.
actually began as plain providers of email response and managing services. The call center industry comprises 80% of the outsourcing industry in the country.
The Philippines has less expensive operational and labor costs, as well as an English
-speaking workforce as a result of English being one of two official languages. English is also one of the major subjects in all educational levels. In 2007, The Philippines remained a top BPO destination for the estimated $150-billion business process outsourcing industry.
These companies do mostly medical reports, discharge summaries, operative reports, therapy/rehabilitation notes, chart notes, and hospital and clinic reports using software and equipment from the U.S.
Filipino animator
s do well in the global market for animation, which is growing due to the increasing popularity of animation as an entertainment medium not just for free and cable TV and the movies but also for computer games, as well as an advertising medium, a graphics medium for Internet content, and an information and educational tool.
Major studios like Disney, Marvel, Warner Brothers and Hanna Barbera have offices in the Philippines (CNN 1995). Some of the latest works of Filipino animators include scenes in Pixar's Finding Nemo
, Paramount Picture's Barnyard and Twentieth Century-Fox's Anastasia
(ABS-CBN Interactive 2004).
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
.
Overview
The business process outsourcingBusiness process outsourcing
Business process outsourcing is a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions to a third-party service provider. Originally, this was associated with manufacturing firms, such as Coca Cola that outsourced large segments...
industry in the Philippines has grown 46% annually since 2006. This boom is led by demand for offshore
Offshoring
Offshoring describes the relocation by a company of a business process from one country to another—typically an operational process, such as manufacturing, or supporting processes, such as accounting. Even state governments employ offshoring...
call centers. Industry estimates from the Board of Investments, Business Process Association onf the Philippines (BPA/P) and BPO Services Association (BSA/U) put the number of people employed by the BPO sector by end of 2008 at 435,000 (vs 372,000 in 2007)- excluding the non-BOI/ non-PEZA entities. The BPO output for 2008 was US$ 6.1B (vs US$ 4.5B in 2007), putting the Philippines as the 3rd largest BPO destination (15%) after India (37%) and Canada (27%). It was expected to hit US$ 7.2B to 7.5B in 2009. The industry was optimistic of 18% growth in headcount 2009.
Overall, Philippine BPO is forecast to earn between US $11 to 13 billion and to employ 900,000 additional people in 2010. To achieve and sustain this growth, the Philippine government offered fiscal and non-fiscal incentives to attract foreign direct investment in these industries as part of the 2007 Investment Priorities Plan. The IPP was prepared by the Board of Investments (BOI), as the lead agency in promoting investments, focused on the sectors identified in the Medium-Term Philippine Development Plan (MTPDP) 2004-2010 (PBOI 2006).
Majority of the BPO facilities are located in First Tier cities in Metro Manila
Metro Manila
Metropolitan Manila , the National Capital Region , or simply Metro Manila, is the metropolitan region encompassing the City of Manila and its surrounding areas in the Philippines...
and Cebu
Cebu
Cebu is a province in the Philippines, consisting of Cebu Island and 167 surrounding islands. It is located to the east of Negros, to the west of Leyte and Bohol islands...
. Second and Third Tier sites are located in regional areas such as Bacolod City
Bacolod City
The City of Bacolod , is a highly urbanized midsize Philippine city. It is the capital of the Negros Occidental province. Having a total of 499,497 inhabitants as of August 1, 2007, it is the most populous city in the Western Visayas Region. It is currently ranked as the 17th most populous city in...
, Baguio City
Baguio City
The City of Baguio is a highly urbanized city in northern Luzon in the Philippines. Baguio City was established by Americans in 1900 at the site of an Ibaloi village known as Kafagway...
, Cagayan de Oro, Clark (Angeles City), Dagupan City
Dagupan City
The City of Dagupan is a 1st class city in the Philippines. It is an independent component city of the province of Pangasinan. According to the latest census, Dagupan City has a population of 149,554 people in 25,921 households. Located on Lingayen Gulf on the island of Luzon, Dagupan is the...
, Davao City
Davao City
The City of Davao is the largest city in the island of Mindanao in the Philippines. Its international airport and seaports are among the busiest cargo hubs in the Philippines....
, Tacloban City
Tacloban City
The City of Tacloban is a port city approximately 360 miles southeast of Manila. It is the first in Eastern Visayas to be classified as a Highly Urbanized City. It is the capital of the Philippine province of Leyte and is the largest city in terms of population in Eastern Visayas...
, Dumaguete City
Dumaguete City
The City of Dumaguete is a city in the Philippine province of Negros Oriental. It is the capital, principal seaport, and largest city of the province. According to the 2010 census, it has a population of 133,470 people. A person from Dumaguete is called a "Dumagueteño"...
, Lipa City
Lipa City
The Lipa City /Li-pâ/ is a first class city in the province of Batangas, Philippines. It is one of the three component cities of Batangas province...
, Iloilo City
Iloilo City
The City of Iloilo is a highly urbanized city in the Philippines and the capital city of Iloilo province. It is the regional center of the Western Visayas, as well as the center of the Iloilo-Guimaras Metropolitan Area...
, Legazpi City
Legazpi City
The City of Legazpi is a first class city and capital of the province of Albay, Philippines. With 179,481 inhabitants according to the 2007 census, it is the largest city in the Bicol Region in terms of population, though not in land area...
, Iligan City
Iligan City
The City of Iligan is a highly urbanized industrial city north of the province of Lanao del Norte, Philippines, and the province's former capital. It is approximately 795 kilometers southeast of Manila...
, Olongapo City
Olongapo City
The City of Olongapo is a highly urbanized city located in the province of Zambales, Philippines. According to the latest census, it has a population of 227,270 people in 50,300 households.-History:...
and Urdaneta City
Urdaneta City
Urdaneta City is a 1st class city in the province of Pangasinan, Philippines. According to the latest census, it has a population of 120,785 people in 22,908 households....
.
Call Centre Industry in the Philippines
In the Philippines, call centres or call centersCall centre
A call centre or call center is a centralised office used for the purpose of receiving and transmitting a large volume of requests by telephone. A call centre is operated by a company to administer incoming product support or information inquiries from consumers. Outgoing calls for telemarketing,...
actually began as plain providers of email response and managing services. The call center industry comprises 80% of the outsourcing industry in the country.
The Philippines has less expensive operational and labor costs, as well as an English
English language
English is a West Germanic language that arose in the Anglo-Saxon kingdoms of England and spread into what was to become south-east Scotland under the influence of the Anglian medieval kingdom of Northumbria...
-speaking workforce as a result of English being one of two official languages. English is also one of the major subjects in all educational levels. In 2007, The Philippines remained a top BPO destination for the estimated $150-billion business process outsourcing industry.
Legal and medical transcription
Finance, logistics and accounting
The Philippines is becoming a regional and global hub for shared corporate backroom operations, especially for financial services such as accounting and bookkeeping, account maintenance, accounts receivable collection, accounts payable administration, payroll processing, asset management, financial analysis and auditing, management consulting, inventory control and purchasing, expense and revenue reporting, financial reporting, tax reporting, and other finance-related services such as financial leasing, credit card administration, factoring and stock brokering; as well as for logistics management, and cargo shipment management.Software Development and Animation
Fueling the recent growth spurt in the outsourcing industry in the Philippines are more higher-end outsourcing services such as Web design, software development, and animation (Shameen 2006).Filipino animator
Filipino cartoon and animation
Filipino cartoon and animation, also known as Pinoy cartoon and animation, is a body of original cultural and artistic works and styles applied to conventional Filipino storytelling, combined with talent and the appropriate application of classic animation principles, methods, and techniques, which...
s do well in the global market for animation, which is growing due to the increasing popularity of animation as an entertainment medium not just for free and cable TV and the movies but also for computer games, as well as an advertising medium, a graphics medium for Internet content, and an information and educational tool.
Major studios like Disney, Marvel, Warner Brothers and Hanna Barbera have offices in the Philippines (CNN 1995). Some of the latest works of Filipino animators include scenes in Pixar's Finding Nemo
Finding Nemo
Finding Nemo is a 2003 American comi-drama animated film written by Andrew Stanton, directed by Andrew Stanton and Lee Unkrich and produced by Pixar. It tells the story of the overly protective clownfish Marlin who, along with a regal tang called Dory , searches for his abducted son Nemo...
, Paramount Picture's Barnyard and Twentieth Century-Fox's Anastasia
Anastasia
Anastasia is a personal name and the female form of the Greek male name Anastasius/Anastasios meaning "resurrection." The name, and its male counterpart, were often given to Greek children born around December 2 or around Easter during the early days of Christianity. It is the name of several...
(ABS-CBN Interactive 2004).
See also
- Call center industry in the PhilippinesCall center industry in the PhilippinesCall centers began in the Philippines as plain providers of email response and managing services, these have industrial capabilities for almost all types of customer relations, ranging from travel services, technical support, education, customer care, financial services, and online business to...
- CyberservicesCyberservicesCyberservices is an information technology term referring to commercial internet based services, or other through similar networks. Widely used in the 1990s the word was replaced by more specific terms of particular services, after the dot com bust of the early 2000s. The term is still being used...
- Philippine Cyber CorridorPhilippine Cyber CorridorThe Philippine Cyberservices Corridor is a plan that is being pursued by the government of the Philippines to create interconnected centers of technology-related services, that are spread out all over the country. Services include business process outsourcing, medical transcription, outsourcing of...
- OffshoringOffshoringOffshoring describes the relocation by a company of a business process from one country to another—typically an operational process, such as manufacturing, or supporting processes, such as accounting. Even state governments employ offshoring...
- OutsourcingOutsourcingOutsourcing is the process of contracting a business function to someone else.-Overview:The term outsourcing is used inconsistently but usually involves the contracting out of a business function - commonly one previously performed in-house - to an external provider...
- Call centerCall centreA call centre or call center is a centralised office used for the purpose of receiving and transmitting a large volume of requests by telephone. A call centre is operated by a company to administer incoming product support or information inquiries from consumers. Outgoing calls for telemarketing,...
- Outsourcing of animationOutsourcing of animationOutsourcing of animation has become widespread. Many entertainment giants such as Walt Disney and IMAX are beginning to outsource an increasing amount of their animation production to Asian countries, particularly India, while other companies are outsourcing animation from India for commercials and...