Outsourcing Philippines: 5 key considerations

MANILA, Philippines — For organizations that have an eye towards maintaining a competitive advantage in a global marketplace, the Philippines is the premier destination in the world when it comes to offshore outsourcing services.

According to Ralf Ellspermann, CEO of PITON-Global, a leading mid-sized outsourcing provider in the Philippines, "the reasons are varied and compelling: lower cost, the superior quality of service, a highly skilled workforce, government support, and the fact that the outsourcing industry in the Philippines is a major driver of the economy."

Low cost

The Philippines is a low-cost outsourcing destination, with BPO providers offering premium support at half the cost compared to many other countries. The average hourly rate is $12-14 per hour with a premium vendor.

Compare that to $24-28 per hour in the United States, it becomes evident very quickly how partnering with an experienced business process outsourcing provider in the Philippines can save an organization a significant amount of money.

Superior quality of service

Premium outsourcing providers in the Philippines invest heavily into their staff, processes, technology and infrastructure, ensuring that outsourcing services are delivered with superior quality. These providers reinvest revenue into quality management and training. They are also funding the use of the most advanced technologies and utilizing state-of-the-art facilities.

That investment also drives performance—as these vendors attract the best trained and most highly skilled workforce and create an environment where employees feel motivated and engaged and provide them the tools to deliver world-class customer experiences.

A highly skilled workforce

Filipino agents are highly-skilled, speak English as their first language, and have experience in customer care functions with some of the world's top brands. There's a reason that multi-national companies like Google, Amazon and Facebook utilize the Philippines for business process outsourcing.

The average cost for a skilled BPO agent with two to five years of work experience in the Philippines is $12,000 per year (agent salary only), which makes them better equipped to provide high-quality services.

Not only are Filipino's highly proficient in English, but they are also trained in the subtle cultural nuances of many different countries. This kind of investment in their workforce makes premium outsourcing vendors in the Philippines a valuable resource.

Government support

Policymakers in the Philippines have long recognized the benefit of the outsourcing industry and have continued to enact legislation to support its growth. Over the years, this has involved deregulating telecoms, investing in communication infrastructure, providing tax exemptions to help offset operational costs, and passing data privacy legislation that has attracted foreign investment and built trust.

In addition, legislation has been passed to benefit the Filipino worker as well, such as the Telecommuting Act, which allows for flexible work arrangements for employees to carry out their responsibilities, adding protection and stabilization to their jobs. Ultimately, this kind of government support benefits outsourcing companies in the Philippines, the employees that work for them, the organizations across the globe that are looking to partner with them.

Economy driver

Over the last decade-plus, the outsourcing industry in the Philippines has become a primary driver of the economy. It now employs over 1.2 million people in over 800 companies and reached revenues of over $26 billion as of 2019. It climbed another 1.4% to $26.7 billion and grew its labor force another 1.8% even amid a global pandemic that profoundly impacted the economy.

Additionally, the industry is expected to grow in 2021, and revenue is expected to reach almost $29 billion by 2022.

"The outsourcing sector in the Philippines continues to grow rapidly for a variety of reasons. BPO providers in the country have become worldwide leaders in offshore outsourcing due to lower costs, a highly skilled workforce, and reinvestment into their organizations. Ultimately, partnering with a premium outsourcing provider in the Philippines provides great value, efficiency, and cost savings for organizations around the world,” Ellspermann says.