Friday, June 27, 2008 Issues in the BPO sector By Ricardo Y. Danlag Jr.,CPA University of Southern Philippines Foundation
THE fast-growing business process outsourcing (BPO) industry in the country is not without problems and challenges.
The Business Processing Association Philippines (BPAP), has identified three key issues that should be addressed with a clear set of initiatives and an institutional framework to sustain momentum.
The three issues are: talent, which require that the supply of qualified workers be sustained; the business environment, referring to the government’s predictable and consistent regulatory policies, and; the next wave cities, which means that additional cities should be tapped to house the different BPO players doing business in our country.
The above issues can be dissected in the light of the present circumstances and realities. In the case of availability of qualified workers, the industry should confront the need to attract more talent. Efforts have to be made to make the supply meet the skill requirements of the offshoring and outsourcing industry. Focus must be made on the English language, problem solving skills and other competencies required by the industry.
But recruitment in the offshoring and outsourcing industry is concentrated in the National Capital Region (NCR), which accounts for about 82 percent. This industry concentration can drive up labor and rental costs, eroding the Philippines’ competitive advantage. Thus, there is a need to identify next wave cities outside of NCR that can house the increasing number of BPO players.
Cities outside of Cebu could be tapped, especially where there is abundant supply of labor. This eventuality would help decongest the metropolis and solve the appurtenant problems brought about by migrant workers.
Government should also provide the necessary environment conducive to business. Policies and regulations should be predictable and hospitable to investors and workers.
To be a major player, we have to put forward the Philippines as an alternative site to India. We have to capitalize on the capabilities of the Philippines in front of US and other prospective customers. And lastly, we have to enhance and maintain the Philippines’ competitive advantages.
