 Philippines
poses challenge to India in BPO
India is the pre-eminent location for
offshore business process outsourcing delivery but is being
increasingly challenged by the Philippines, a new survey by a
research company has concluded.
The Philippines government, recently announced its intention to
develop and promote the country as a hub in the delivery of
customer contact centre, medical transcription, animation, BPO
and shared financial services.
Offshore BPO, it said, today accounts for
only two percent of total business process service delivery
contract value worldwide and is only expected to rise to six percent of the total by 2008.
Regardless of the many challenges associated with off-shoring
the delivery of business processes, the potential of 40 percent
to 60 percent cost reductions is highly compelling to
prospective buyers, especially in the commercial sector.
The financial services industry accounts for 45 percent of total
offshore BPO delivery contract value as these organizations seek
to reduce costs in an increasingly competitive environment.
Other significant opportunities exist within manufacturing and
telecom sectors.
While tremendous opportunities exist for offshore service
providers, it said, they are unlikely to reap the rewards if
they take an arms-length approach to their in-country
operations.
Governance of offshore BPO delivery is critical, with companies
requiring strong escalation procedures and the ability to
closely monitor their in-country operations.
To address this, it said the major multi-national service
providers are typically incorporating offshore delivery
capability as one element of a geographically distributed
delivery capability.
And many "pure play" offshore service providers recognize the
importance of local on-site account managers or governance teams
in all in-scope countries.
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