5 Reasons Why the Philippines is the Globe’s Top Outsourcing Destination




Outsourcing Philippines? Let’s just immediately dive in.

1. Place

A group of around 7,640 islands in Southeast Asia, just around 900 miles north of the equator, compose the Philippine archipelago. The country is among those on top of mind when thinking of travel and vacation destinations, and also for business.

On December 1, the World Travel Awards (WTA) revealed the winners of the 2023 travel destination accolades. The Philippines secured the title of the World’s Leading Beach Destination for the second consecutive year, along with its fifth straight win as the World’s Leading Dive Destination. Additionally, Manila was honored as the World’s Leading City Destination for the same year.

The country still has nominations for the global categories awaiting WTA’s announcement of winners before the end of this year. They are for 2021 World’s Leading Beach Destination, Dive Destination, Island Destination, Attraction, and Tourist Board.

view of Philippine islands

Business and Pleasure

Of all the islands in the archipelago, according to National Geographic, about 2,000 of those islands are inhabited. So there are still a lot of islands to choose from for your next trip. With pristine beaches, breathtaking sceneries, and a lot of wonderful attractions, the Philippines is a fun place to be, even for business.

In 2016, CNN’s Richard Quest examined the idea of doing bleisure in the Philippines. Quest, then, found out that there is indeed a blurring of lines between business and pleasure in the tropical archipelago. He explored further how far can your business travel take you. He easily found calm on an island, getting there from the bustling city of New York just 48 hours earlier.

2. People

If you’re looking to put up, expand, or outsource your business, well, why not in a place where there are smiles around.

Aside from islands or regions of origin, the locals in the archipelago are generally called Filipinos. Now, if you immerse yourself among Filipinos, you’ll see them beaming with smiles, beaming through even with face masks on. It’s just a happy place with warm, welcoming, happy people.

Population, Talent, Skills

Compared to their neighboring countries, the Philippines boasts of a growing population, their human resource, as it were. Even though they are Southeast Asians, they seem to be born and seen growing up Western, i.e., the global West. The Philippines is the third-largest English-speaking nation in the world, such that Filipinos are outstandingly proficient when it comes to the English language.

TechBullion observes that “business processes such as finance and accounting are patterned after the US, making Philippine operations easier for foreign companies.” The financial giants “all call the Philippines home when it comes to managing their Business Process Outsourcing (BPO) requirements.” This makes the country one of the world’s leading outsourcing destinations for financial services.

All those highly specialized services would have required highly specialized training for highly specialized teams. But this seems to be not a problem in the Philippines as they have talents and skills ready, and on-demand. This, combined with a culture of service and hospitality, then you’re indeed in a business paradise.

The 2023 Global Services Location Index ranked 15 countries based on labor cost, local talent pool, and government promotion initiatives. “They were evaluated against 44 measurements across four major categories: financial attractiveness, people skills and availability, business environment, and digital resonance.”

Meanwhile, the location assessment result indicated that “at a regional level, Asia continues to dominate the Index.” The Philippines is in the top ten overall and among the top three in terms of people skills and availability. For comparison, the US is 6th on the list, and the UK is 8th. Both are at the other end of the list, however, in terms of people skills and availability.

Outsourcing Philippines

infographic version of the article on outsourcing in the Philippines

3. BPO Industry in the Philippines

It was 20 years ago when the BPO industry took root in the Philippines. It began with fewer than 20 companies. Now there are around 800 of them. Even the office space renting business is growing despite the pandemic because the BPO industry just keeps on growing. The Philippines still has a lot of space available for conversion to economic zones for BPOs to thrive further.

Competition for BPO domination

India consistently topped the list of go-to countries when it comes to business process outsourcing. But, then, they experienced a major hit of COVID-19, one of the world’s worst outbreaks earlier this year. The IT and Business Process Association of the Philippines (IBPAP) observed that this prompted companies to rebalance their geographical footprint. “A major search engine company” and an “American retail giant” were among those that routed jobs to the Philippines. Also, one BPO who already has several locations in the Philippines even became the country’s largest employer. The shift happened as India struggled with the virus and work had to be shifted to Manila. While some of these are temporary, some clients have decided outsourcing Philippines on an ongoing basis.

To manage the demand in the time of the pandemic, some BPO companies in the Philippines housed workers in hotels and private buses ferried them  in times of public transportation restrictions. Further, Nikkei Asia reported (September 2021) that “for those who shifted to working at home, telecoms companies installed Wi-Fi and employers provided noise-canceling software.” Now, if callers could hear waves splashing, birds chirping or roosters crowing in the background, perhaps the employee is in a vacation destination somewhere in the Philippines.

4. Infrastructure

Rey Untal, IBPAP’s outgoing president told Nikkei Asia that “remote work will likely continue, even after the pandemic ends.” Regarding this, telephone, power, and transport companies in the Philippines are also doubling their efforts.

Companies are assured, however, when outsourcing the Philippines despite the pandemic. The 2021 Tholons Global Innovation Index, the leading touchstone to benchmark the accelerated digital transformation of industries and services globally, noted how top 50 nations are pivoting to the new normal. Their Global Innovation Country Index showed the Philippines ranking eighteenth among the top 50 digital nations.

What the new normal urgently needs is for governments, companies, service providers, and institutional policies to work together as a business catalyst. This will significantly help develop an ecosystem that ignites collaboration among enterprise clients, entrepreneurs, digital platforms, experts, and investors.

Business Catalyst

The BPO industry in the Philippines has grown exponentially also because of government support since its initial stages. 20 years on, outsourcing Philippines has also helped other industries and sectors grow in the country. The Philippine News Agency even wrote (October 29, 2021), “BPO remains key strategy to property market recovery.”

PNA quoted Colliers Philippines director for Office Services Dom Frederick Andaya in their Q3 2021 Property Market Briefing. He said, “BPOs would help in the absorption of available office space in Metro Manila currently at 1.78 million square meters or equivalent to 60 vacant buildings with a leasable area of 30,000 sqm per building.”

PNA added that “aside from Metro Manila, BPO companies are looking for office spaces in the provinces like Cebu, Pampanga, Iloilo, Bacolod, and Davao.”

Further, “the property market expert said the adoption of a hybrid work model, combing on-site and work-from-home work arrangements, as well as the availability of IT parks and buildings registered with the Philippine Economic Zone Authority (PEZA) could also affect in the investment strategies of companies particularly BPO firms.”

5. AI

We are now in the age of the fourth industrial revolution. The first one, the age of the machines, harnessed water and steam, and improved productivity in agriculture. The second, the discovery of electricity and assembly line production, significantly sped up processes, production and improved the supply chain. The third, the digital revolution, combined electronic and information technologies to automate production.

Moreover, the Philippine News Agency (PNA), wrote on August 25, 2021, “AI processing seen as next BPO for PH.” The article said, “The processing of artificial intelligence (AI) is expected to be an emerging industry for the Philippines following the growth of the business process outsourcing (BPO) sector in the past decades.”

Higher emphasis on digital innovation

Tholons set higher Expectations from and preparedness of the top 50 digital nations and top 100 super cities towards the new normal. For enterprises to innovate at scale, Tholons recommends focusing on three key elements.

  1. Re-imagining consumer experience
  2. Bring in innovation
  3. Implement through digital and new technologies

Philippines’ Department of Trade and Industry (DTI) Secretary Ramon Lopez released an update on August 24, 2021, that would take innovation at a much higher scale. He said that “the government and private sector are pushing for the expansion of AI technology in the country.”

In May 2021, the DTI released the industry blueprint. This made the Philippines become one of the first 50 countries in the world to launch a national AI roadmap. The national AI roadmap aims to transform the country into an AI powerhouse in the region.

view of Manila skyline

Summing up

If you’re looking for a BPO partner and a good location, outsourcing Philippines would be a great idea. The country has a developed BPO industry, a government-supported, BPO-friendly infrastructure, and a blueprint for a sustainable business ecosystem. The place is wonderful. The people are wonderful. And they are ready to help you with your business.

Should you need a guide to show around, we at StratAccess can help you find a match for you in the Philippines for your BPO needs.

StratAccess Inc. (StratAccess), established in 2012, is committed to finding the best centers in the Philippines for its clients for successful BPO solutions. The company is focused on transforming the landscape of call center partnerships to meet the requirements of today’s small and medium-sized enterprises (SMEs). StratAccess consultants are attuned to helping clients take a hard look at their business objectives, current organization infrastructure, and operational practices.

We at StratAccess strive to build long-term relationships that extend beyond the typical vendor-client transactions. Our primary focus is to successfully promote and serve each client’s products or services as though they are our own. Combined with the skill and knowledge of the Philippine outsourcing industry, our company has positioned itself as a leader in delivering its clients access to qualified quality and cost-effective BPO referrals.

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