• By quade
• 26 August 2024

Philippine Market Focuses On Keeping BPO Investors Happy

The BPO industry is expected to match and eventually surpass OFW remittances in its dollar earnings to the Philippine economy. This makes it one of the largest earners in the country and a critical area for the workforce. But while it is impressive, there are still hurdles when it comes to BPO investors.

Foreign ownership makes up a large part of the industry with an estimated 4 out of 5 BPOs being owned by a foreign entity. Unlike other sectors, it is quite easy for BPO operators to pack up and leave. In contrast to manufacturing that relies on land and equipment, all BPOs require are computers which can be easily taken or left behind. This means there is much incentive to keep BPO investors happy.

Success Story to BPO Investors

Nothing gets BPO investors more excited than success and there is plenty of that to report. Experts predict that the industry will generate 1.8 million jobs and $38 billion this year. Meanwhile, the World Bank estimates that OFW remittances are at $40 billion, showing the gap is now closing rapidly.

Just last year, the BPO industry created 1.7 million jobs and brought in $35.5 billion in revenues compared to $39 billion for OFWs. Even with the emergence of AI, some experts believe this will not cause major disruption as many BPOs can leverage these tools to improve their services.

In the end, this may even create more revenue and improve the system.

Risks to BPO Investors

While AI will not scare BPO investors, there are still two risks that they worry about, government red tape and a lack of qualified talent.

“The Philippines is the world capital of this industry. “We are number two to India, but they have a population ten times bigger than ours. We are growing faster than India. We’re growing faster than the rest of the world. We should appreciate this industry more and help our investors generate more jobs.”

-Anonymous BPO Spokesman

However, there are some positive developments as the industry is no longer requiring a college degree and allowing high school graduates to apply. Some BPO investors have even organized programs to improve the quality of high school talent.

Several BPO groups have signed a Memorandum of Understanding with the Philippine government that acknowledges their desire to adjust the minimum hours for BPO internships. The current requirement is 80 and they have pushed to increase it to 640 hours. This shall provide interest with more opportunities to learn and make entering the workforce much easier.

With several weeks’ worth of training, they believe that it will be enough time to weed out less experienced or unenthusiastic employees while improving the quality of the current ones.

However, they are concerned with the amount of roadblocks it takes to get even this much done. BPO investors are concerned with the ease of doing business here as they believe that things like unnecessary rules. among these are work-from-home restrictions.

“We had this problem of forcing our workers back on-site or losing tax privileges. That was completely unnecessary. India didn’t have this problem. Our officials were panicking because malls were not getting enough foot traffic to show a return to normalcy, and property companies were putting pressure to sell or rent more space.” 

-Anonymous BPO Spokesman

“It was one of those things that hurt the image of the country as a place to do business. One of the things that investors don’t like is a place where rules and regulations can be changed in the middle of the game. Unfortunately, these types of things still happen, whether it’s at the national level, involving the Bureau of Internal Revenue and Bureau of Customs or even at the LGU level. We would really like our investors to spend their time running their operations, instead of having to deal with the disruption of inconsistent implementation and interpretation of rules and processes and incentives. This problem is still recurring. This is not good for our image of reliability for investors.”

-Anonymous BPO Spokesman

The other concern is contradicting claims and regulations between different LGU rules. One example cited by BPO investors was that the office operated in Makati and required all employees to provide health certificates even though many employees worked from home and belonged to other provinces.

Education is another worry as they believe the government should play a more active role in educating and upskilling workers. This is especially true now as BPOs are sprouting out across all parts of the world like South Africa, Latin America, and Egypt. All of these places can challenge the Philippine’s dominance in the BPO sector. While BPO investors remain confident in the Philippines’ capabilities, they still think there is work to be done.

“Educational reform is something we should also address, but that’s going to take quite some time. The private sector will have to continue to take on the burden of reskilling and right-skilling our existing workers and then work closely with the academia to try and narrow the gap between job demand, which is strong, versus talent supply, AI or no AI,”

-Anonymous BPO Spokesman

“What makes us attractive right now is our competitive edge. Despite all these problems over the past decades, we are a world leader in this space. We are a golden goose of this economy, and so all I ask is that we allow our investors to run their business as they should, and not harass us with senseless rules that sacrifice the ease of doing business. I can’t think of a bigger economic pillar. Instead of making it harder, let’s make it easier to let us do the one thing we’re good at.”

-Anonymous BPO Spokesman

How BPOs Benefit from Keeping BPO Investors Happy?

The entire industry including BPO investors, operators, and even the government should pay close attention to these developments. With the industry continuing to mature, the Philippines remains robust and respected, but also worried with growing threats on the horizon. Soon there will be other major BPO players in the world.

However, while the competition grows, so do the potential and opportunities. New technology, programs, and services will determine success in the BPO industry. All of this depends on how energetic the government and BPO investors are. They must implement reforms and programs that will guarantee the Philippine’s place in the industry.

More importantly, it is important to keep a close watch on how the rest of the world is changing. With new players emerging, they are bringing in new practices and ideas that can be implemented here.