To Cebu's BPO industry 2013 ushered in big ticket investors

CEBU, Philippines - The Cebu Business Process Outsourcing and Information Technology (BPO/IT) sector has not failed stakeholders’ upbeat outlook at the start of 2013, as the year ushered Cebu to a higher level in terms of investors’ interest and confidence.

Cebu Educational Development Foundation for Information Technology (CEDFIT) Executive Director Wilfredo Sa-a said that aside from the obvious and consistent growth of the sector, this year Cebu started to lure international BPO/IT analysts to look into the capability of the province to host higher level of outsourcing investments, more than the traditional voice services.

“We’ve seen groups of international investors and BPO/IT analysts, venture capitalists, visiting Cebu doing feasibility studies, and exploring the place for probable opportunities. We’re now in the world radar,” said Sa-a.

Tholons’ declaration naming Cebu as number eight in the ranking as emerged BPO Destination in World largely helped, but Sa-a said what pushes Cebu’s sweeping climb to the top is the pro-active stance of stakeholders to make Cebu one of the preferred destination for BPO/IT investments.

According to Sa-a, Cebu is now starting to attract higher value BPO/IT investments, such as software development, health and insurance management, shared services,  among others.

Over 100 thousand people are now employed in the business process outsourcing industry in Cebu.  An average of 24,000 new graduates from the different colleges and universities in Cebu each year, more and more skilled young people sign up for work in outsourcing companies and continue to build the reputation of Cebu as a leading destination for business process outsourcing.

Cebu continues to have challenges to face before it can become the number one business process outsourcing destination, especially because the competition in many surrounding areas of Asia is fierce. Cebu will have to work to continue to build its reputation as an outsourcing leader to make it to the top.

Cebu is currently poised as an outsourcing star. It continues to gain an edge on the prevailing competitive landscape of the global services outsourcing industry.

In an earlier interview with Tholons managing director for South East Asia Jonathan Defensor De Luzuriaga, he said that there is a need for Cebu to find out its real niche in the BPO industry, thus a scientific study must be done.

“Cebu needs direction in hitting the growing BPO market. I am surprised of the jobs done here in BPO sector, not only in voice, but in more complex jobs like animation, graphic design, hardware and software development,” Luzuriaga said.

This year, there were at least nine BPO/IT companies that opened, these are;  Results Company, EXL Services, United Health Group, Cognizant, Telstra, Ameeratel, Firstsource, Daimler Group Services, and Synacy.

About 70 percent of the total BPO/IT companies in Cebu is doing non-voice services, although this sub-sector is employing less compared to the huge manpower requirement of voice-outsourcing firms.

As of third quarter of this year, the BPO/IT sector generated a total of US$ 435.4 million, 84 percent higher compared to the same period of  in 2012.

National Economic and Development Authority (NEDA-7) Assistant Regional Director Efren Carreon said the BPO/IT has started overtake other top revenue contributors in Cebu, and its robust and consistent growth would make Cebu’s economy much more resilient to any crisis.

Known as one of Cebu’s growth pillars, the ICT industry saw a rapid growth expansion since the start of 2012. This year, Carreon said the industry is seen to make another record double-digit growth performance.

In September of this year, the Business Process Association of the Philippines (BPAP) President Benedict Hernandez announced that the sector needs the help of the government for its effort to improve disaster preparedness program.

Although most BPM companies already have their own preparedness program, the sector needs the support from the government, especially in infrastructure building, and other requirements.

In a statement earlier released by the Information Technology and Business Process Association of the Philippines (IBPAP) to member companies, it urged BPO and IT firms to be prepared all the time, as about 19 tropical storms enter the country’s area of responsibility, and six to nine of these successfully make landfall. This causes downtime and disruptions at work, which might affect deadlines and deliverables.

IBPAP President Jose Mari Mercado said that companies should employ “standard business continuity program” which are aimed in ensuring continued operations.

Contingency measures should be implemented in cases wherein employees are hindered from going to work due to extreme weather conditions. There should also be tangible support such as generators in case of power failure and reliable connectivity for unfaltering communication. Following these is a disaster recovery plan, which would allow businesses to resume normal operations and service to clients.

Apart from operations, accountability for employee safety is also a top priority. There is a large demand for BPO workers to go to their workplace despite weather disturbances, especially those in customer service or technical support.

In these cases, certain companies provide food to present staff or temporary shelter onsite when travel is no longer possible.

BPO/IT industry is one of the strongest sectors that were not affected by the recent calamities. Working schedules were not badly disrupted in Cebu, Sa-a said. /JOB (FREEMAN)