In a survey conducted by the Business Processing Association of the Philippines (BPAP), executives of BPO companies said they are going to expand their workforce from 6-50 percent and offer more complex services this year.
“First, we see a return to optimism and better prospects for rapid growth. Second, the industry is more than just recovering from slower growth in 2009. It is diversifying and transforming as a result of increased demand for non-voice and more complex services,” said BPAP head Oscar R. Sañez.
However, many survey respondents are worried that the tight labor market may hinder their expansion plans. Thirty-four percent of BPO executives said that lack of enough qualified workers is their primary concern, and the upcoming elections may affect buyer perception.
A total of 160 BPO executives participated in the survey which was conducted early this year.
Based on the report released by market intelligence firm International Data Corporation (IDC), there will be an increase in demand for IT services in the UK, Germany, and the Nordics, with an annual growth rate of 3.4 percent between 2010 and 2014.
According to Laura Converso, research manager of IDC European software and services, while demand is expected to increase at the second half of this year, new technologies and price issues will affect the ability of the UK market to bounce back. "We expect the 'growth agenda' to return slowly, bringing investments in business intelligence and industry-specific solutions, as well as the global rollout of applications, when these solutions can support business growth, towards the end of the year."
by: Karen Cayamanda
The Governance and Ethics Committee of the National Association of Software and Service Companies (Nasscom) recently released the key recommendations for India’s IT-BPO industry in order to develop highest probity standards and strengthen corporate governance within the industry.
Recommendations included in the report are: ethical practices for contracts, data security, clear accountability, compliance with legal matters, and customer satisfaction.
To ensure that the company and employees are aligned in terms of common goals, Nasscom’s recommendations include confidentiality of information, protection of company assets, and adherence to policies. The report also outlined points that will promote a safe working environment for employees as well as clear guidelines to strengthen ethical practices with vendor partners.
The 2009 top emerging outsourcing destination in the world is now facing the problem of not having enough workers. According to Cebu Investment and Promotions Center (CIPC), Cebu does not have enough manpower to meet the demands in the business process outsourcing (BPO) sector.
“Cebu does not have enough economies of scale to supply BPO firms that continue to expand here. We don’t have to attract more BPO investors but we must in the short term address the problem on human resource,” said Joel Mari Yu, Managing Director. He added that the province can produce approximately 23,000 graduates annually, and only about five percent will be qualified for BPO work.
At present, there are 60,000 workers in BPO companies in Cebu. Yu said that because of the lack of enough manpower, firms opt to hire workers from nearby provinces or expand operations outside Cebu.
by: Karen Cayamanda
The National Statistics Office (NSO) reported that the call center sector is still the no. 1 revenue generator for the business process outsourcing (BPO) industry of the Philippines.
Based on the initial results, call centers registered P56.7 billion in revenues in 2006. This comprised 70 percent of the gross revenues of the country’s BPO sector which reached P81.8 billion. Meanwhile, the software and consultancy sector hit P11.1 billion in revenues, software publishing with P5 billion, data processing with P4.8 billion, and hardware consultancy registered P28.3 million.
This is amidst the problem of not having enough qualified workers to meet the demand. “Although the lack of qualified people is still a major concern in the BPO industry, I am confident the private sector can craft the solutions,” said LiveIt chief executive officer Alfredo Ayala. The Business Processing Association of the Philippines (BPAP) is initiating programs such as Advanced English Pre-employment Training to equip potential BPO workers.
According to 1Q10 Advisor and Business/IT Service Provider Pulse Survey by EquaTerra, buyers recognize that outsourcing can reduce costs, but are “slow, deliberate, and risk averse” and are cautiously weighing their options. This leads to delay in outsourcing deals.
“They [buyers] understand the problems and are painstakingly sorting through solutions and weighing options. Many are faced with reduced staff to support new projects, further stalling the process,” said Stan Lepeak, managing director of global research for EquaTerra.
Other key findings include:
• Forty-six percent of EquaTerra advisors cited increased demand in BPO/ITO. This is an eight percent decline quarter-over-quarter and three percent for the year.
• Forty-six percent of service providers said the economic condition is still a major factor in outsourcing. This is an eight percent increase year-over-year but 10 percent lower compared to last quarter.
• Sixty-four percent of service providers expect increase in current contract scope. This is 20 percent lower quarter-over-quarter and 21 percent for the year.
The International Association of Outsourcing Professionals (IAOP) released the Global Outsourcing 100 last April 19. It is the list of best outsourcing service providers and advisors in the world.
Accenture was ranked as the world’s best outsourcing service provider for the third year running. Completing the top 10 list are Infosys Technologies (India), Sodexo (France), Wipro Technologies (India), IBM (US), ISS (Denmark), Tata Consultancy Services (India), ARAMARK (US), CSC (US), and Convergys (US). On the other hand, TPI got the top spot in the list of best advisors, followed by EquaTerra, Alsbridge, KPMG, Kirkland & Ellis, Quint Wellington Redwood, Morrison & Foerster, Baker & McKenzie, Gartner and Booz & Company.
“These firms on the Global Outsourcing 100 are leaders who are helping the companies that use their services realize greater value and business flexibility, as well as a lower cost structure that will make them stronger in the long term,” said IAOP Chairman Michael Corbett.