Growth and Development of BPO in the Philippines

By default, every major global company now has a presence in the country of BPO Philippines. As the third largest economy in Southeast Asia after Singapore and Hong Kong, BPO is the next generation of service providers in the corporate world. Just like any other BPO firm in the world, the company also involves in outsourcing its back-office functions from a remote location of India. The core function of such back office services is to take care of all the administrative work involved in the procurement of the goods and services from the suppliers and to make sure that the transaction is completed as per the terms and agreement between the company and the suppliers. On the part of the supplier end, what he has to do is provide the requisite tools, equipment and infrastructure in the required manner and at the most affordable prices and pay for the service.

Offshore outsourcing to India - the changing face

There are a number of benefits that can be enjoyed through BPO Philippines. The country has been an attractive entrant in the field of business process outsourcing. This is because the service providers have made BPO Philippines their backyard. There are innumerable outsourcing companies in the Philippines that offer various back office services. The total outlay required for developing a BPO operation in the Philippines is just a fraction of what it costs in developed countries like the UK or US offshore outsourcing.

BPO Philippines is also gaining popularity because the government is offering various incentives to bring more outsourcing projects into the country. The first incentive is the Re-exports Tax Credit, which is designed to attract foreign investors to set up a BPO Philippines based branch. Another significant incentive offered by the government is the Contract Purchase Agreement program. Under this program, corporations are granted to purchase power over 100 percent for the services provided by their Philippines based counterparts. With such a vast number of multinational companies flocking to the Philippines for their BPO projects, there has been an increased demand for skilled manpower in the country. Consequently, more recruitment agencies such as Hays in the Philippines have come into existence to tap the outsourcing industry and bring more service provider jobs to the country.

In response to the growing demand, more graduates and young professionals are enrolling in business programs at local universities to improve their employability in the BPO industry. These students are thus gaining a competitive edge against other applicants from different countries. As a result, the demand for skilled manpower is consistently on the rise. Another reason why the BPO industry is seeing a surge of growth in the Philippines is the presence of highly experienced BPO management teams. With years of experience in BPO operations in different parts of the world, these teams are well aware of the requirements of the global market and know how to respond to them effectively.

With the growing demand for offshore outsourcing, the government has also taken important steps to regulate the activities of outsourcing firms. The Department of Labor and Employment (DOLE) has established several Implementing Trade Rules (ITR) that are specifically designed to protect the interests of Filipino workers in the Philippines. Among these rules, the DoLE has implemented measures to protect the interests of foreign outsourcing employers. For instance, it requires third party outsourcing firms to apply for licenses before engaging in transactions with Filipino employees. Such licensing procedures are necessary to guarantee that the firms will not engage in activities that may harm Filipino workers and may subject the workers to conditions that would discriminate against them.

Another measure that the DOLE has taken is encouraging service providers to contract directly with the businesses in the Philippines. Under this arrangement, the service providers to establish an office in the Philippines and engage Filipino employees to work there. The advantage of this arrangement is that Filipino employees enjoy better working conditions since the service providers take care of all the recruitment and payroll responsibilities themselves. Aside from this, the service providers enjoy the opportunity to expand their business processes by learning the ins and outs of the business process outsourcing industry. The end result is that both sides reap benefits by getting the best out of the relationship.