Outsourcing to spur skilled Philippines workforce

12.01.2006
The skills set of the Philippines' IT workforce is beginning to move up the value chain as global demand for application outsourcing increases. This means that the country is no longer just a producer of contact center agents, but applications developers as well. This is the observation of Senator Manuel Roxas who was the guest of honor during the inauguration of HP Philippines' new Global Delivery Philippines Center (GDPC) in Ortigas last month.

'There is now a very positive evolution in the skills set and services we are able to provide,' said Roxas. Whereas five years ago, most outsourcing activities in the country were call center-focused, there now is a much more sophisticated undertaking by the industry, he said, citing a major insurance company that has recently located its financial forensics activity in the Philippines as example. The senator said that this is the direction the country should be taking.

Having been recently awarded a Capability Maturity Model Integration (CMMI) Level 3 certification for its organizational practices in software, systems engineering, and integrated product development, the GDPC would focus primarily on application outsourcing across SAP, Oracle, and .Net applications. HP GDPC's operations, employing more than 600 employees, would be split between the company's main offices in the Robinson Summit Center in Makati and the new facility, with the new site to accommodate an initial 200 employees.

Nilo Cruz, HP Philippines country managing director, said the new office is a big step towards the growth of their business in the country. Cruz said that they now have around half of the 200 positions for the new site filled up and they are hiring roughly 20 employees every month, mostly for the application services position.

During the GDPC inauguration, Roxas said that application outsourcing companies like HP not only make a financial investment, but an emotional and psychological investment as well by inspiring current and future workers to acquire and develop very sophisticated skills set required for application services positions.

'You now have a good number of people able to operate at CMMI Level 3 and who knows, in the future, maybe even Level 5,' said Roxas. 'The message for us as a country is that these 200 people and those that will be hired in the future, their skills set is not ordinary, creating a community of like-skilled people.' This way, the senator added, it would be easy to integrate with the flow globally and technology transfer would be much easier. 'It moves us up the value chain; it's a good start.'

A firm believer in finishing one thing at a time, Roxas said that aligning our efforts accordingly instead of throwing a little effort here and there and not producing anything tangible in the end, may be the answer to the country's education problems. 'We have to start them young,' he said, citing that 25 out of 100 students that begin grade one are out of school by grade four. 'So you only have three or four years to teach them and make them at least have basic literacy competencies.'

With the education budget usually not enough, Roxas suggested solving all grade one issues first before moving on to grade two -- referring to books, classrooms, and teacher problems common to all grade levels. Roxas said that while finishing problems one level at a time could be slow, it should make it easier for the country to truly move forward.

Agreeing with Senator Roxas, CICT commissioner for strategic development Damian Mapa added that students should be encouraged early on not only to develop interest in education, but in IT education in particular. The CICT commissioner said that for every 100 students that go into grade school, only 64 enter college. Out of the 64, only 15 take up Computer Science or other IT-related courses. Thus, IT career advocacy is something the CICT is seriously working on. The private sector is also doing its part as IT vendors such as HP have been actively partnering with industry organizations and universities in teaching relevant IT courses with the ultimate goal of having the best key talent available for the industry.

Mapa added that the CICT, Technical Education and Skills Development Authority (TESDA), Commission on Higher Education (CHED), and the IT foundation of the Philippines (ITFP) have just finished a standard curriculum for IT where existing schools -- or anyone that is setting up a school -- that do not follow standards will be closed down. The courses that now have set standards are medical transcription, animation, hardware repair, PC operations, and programming.

Bala Mahadevan, head of the application services delivery unit for HP's Global Delivery India Center, said that the necessary ingredients for spectacular growth in the outsourcing industry are, in fact, already present in the country; it is all just a matter of improving what the country has and maximizing what is present. 'I see here what I saw in India a few years ago,' said Mahadevan, adding that the Philippines even has some advantages over India -- like it being a smaller country. 'Sometimes size can be a problem because it is harder to control,' he said. Further stressing that a skilled workforce is the country's greatest asset, the HP official said, 'I'm seeing productivity and passion, that's the key; people have to be a big part of it and I see that here.'