Chief executive officers from the U.S. are now saying that the Philippines has 'better people, better business environment, better infrastructure, and a better lifestyle,' according to Richard Mills, chairman of Chalr' Associates.
'The Philippines has not really done a very good job in marketing the country; still, managers are now looking at the Philippines as a very good option,' Mills noted in an interview with Computerworld Philippines.
This does not mean, however, that the Philippines has overtaken India and that the latter has somehow 'gone bad,' according to Mills. 'India proved to the world that offshore outsourcing was viable; the Philippines has a BPO opportunity today because of India.'
In explaining why India is currently a 'worse' option for outsourcing, he pointed out the country's alleged problems like increasing salaries and worsening staff turnover becoming 'more pronounced.'
On the other hand, this provides a window for the Philippines to prove itself as a worthy or even better option for companies looking to outsource operations offshore.
'Most regional leaders I talked to say that, probably because of its great success, India has become a more difficult environment, also mainly because of the increasingly intensive competition,' Mills described.
Success stories
Chalr' Associates is a management recruiting partner to multinational corporations throughout the Asia Pacific region, with specific focus on Singapore, the Philippines, Indonesia, Thailand, and Malaysia.
'Most experts I talk to also say the environment here is easier, because the people have a better customer service mindset and they are more comfortable with Western culture,' said Mills.
Sharing some the stories of various outsourcing organizations that have located in the Philippines, Mills cited as examples Hong Kong Shanghai Banking Corporation (HSBC), IBM, and Sykes.
After setting up its BPO delivery center in the country less than two years ago, the bank's Philippine delivery center now employs 2,500 people and is ranked number one among eight HSBC Global Delivery Centers in terms of quality of service.
IBM, meanwhile, is also reportedly growing its outsourcing operations in the Philippines a lot faster than India. Located in Eastwood, Quezon City, IBM last year officially announced IBM Business Services, promising to expand its 'business transformation outsourcing' operations in the Asia-Pacific market.
According to Mills, IBM had a large site in Bangalore last year that was closed down because it was allegedly not performing well in terms of quality. Majority of these jobs were then moved to the Philippines and IBM is reportedly targeting to employ 10,000 employees in the Philippines for next couple of years.
In the case of Sykes Enterprises Inc., the company reportedly spent millions of dollars to set up capacity in India, which was later shut down due to similar performance issues, after which all 1,500 jobs were transferred to the Philippines.
'Companies are going to move a lot more jobs here. The next phase will be that companies from a broad range of industries, even the small ones, will be moving jobs here,' Mills said.
He added: 'These companies locate here not just for lower cost; a lot of it is because they seek to improve quality and Filipinos can do this job very well.'