BPO Philippines: Moving up the Value Chain

The success of the Business Process Outsourcing (BPO) industry in the Philippines is certainly no accident. The country carved out a niche for itself two decades ago and through education, training, and government support has become a global leader in the outsourcing industry. However, the nature of BPO work is changing. “With an ever-increasing use of technology, offshore BPO destinations such as the Philippines hold less of an advantage over onshore locations than they have previously. As a result, it’s critical for BPOs in the Philippines to focus on their strengths as well as develop new skills and areas of expertise that are in high demand and still require a human touch,” says Ralf Ellspermann, CEO of PITON-Global, an award-winning BPO in the Philippines.

As outsourcing evolves, many of the tasks that the industry has been known to provide at a lower cost have changed too. There has been a gradual evolution from simple call center outsourcing, to utilising BPOs for more complex omnichannel contact centre and back-office support. This eventually has transitioned into full-blown outsourcing of virtually every business process. Today, there's a movement towards knowledge process outsourcing. This requires advanced analytical and technical skills as well as a high degree of domain expertise, which of course requires agents with a higher skill level.

“The Philippines has always been known for its English language proficiency, close cultural affinity to the West, highly educated and tech-savvy workforce, unrivaled customer service orientation, and of course, low cost of labour. These are still key competitive advantages that the country holds over other offshore outsourcing destinations,” says Ellspermann.

As far as task-specific advantages, BPOs in the Philippines have already branched out beyond simple voice-based services by focusing on areas in which it excels. One area of expertise in the Philippines is in financial services and fintech. Approximately 10% of the Philippines’ BPO workforce works for leading financial services or fintech companies such as Square and Green Dot providing both front and back-office support.

Another is e-commerce. The Philippines is the world’s largest and leading outsourcing destination for customer service-related outsourcing tasks. This isn't likely to change. While the tasks that Filipino customer support agents handle will soon become more complex, the edge Filipino agents have over e.g., Indians regarding customer service orientation remain unchanged.

Healthcare is yet another large and fast-growing BPO segment in the Philippines. Both third-party outsourcing providers and captive operators in the healthcare sector have a huge demand for agents with a medical background. With over 250,000 registered nurses and doctors in the Philippines, specialized healthcare BPOs and their clients have an enormous talent pool to draw from.

These industries are just a few of the areas where BPOs in the Philippines hold a significant advantage. With advances in technology and the growth of artificial intelligence replacing many of the simple, repetitive tasks that have historically been outsourced, there are still opportunities to continue to add value. Highly specialised processes that will require more highly skilled outsourcing in the future include robotics process automation, engineering, crypto, biotech, among others. “BPOs in the Philippines will continue to specialise, refine their expertise, and upskill their labour force to adapt to this new environment and ensure that they remain competitive in the global marketplace”, concludes Ellspermann.