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Outsourcing News for March 2011 | MicroSourcing

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Organizers Ready for Top PH Outsourcing Event

by: Ronald Escanlar

Thursday, March 31, 2011 | Outsourcing News | Comments (0)

International Outsourcing Summit Philippines

The International Outsourcing Summit, the Philippines’ top outsourcing event, is gearing up for its third year, to be held later this year from October 11 to 12 at Sofitel Philippine Plaza in Pasay City.

The industry group Business Processing Association of the Philippines (BPAP) has renewed their contract with events organizing firm TeamAsia. This year’s summit will revolve around the theme “Global Market Leaders Addressing Global Issues.”

“The IT-BPO Road Map 2011-2016 identified key opportunities and risks for the Philippines to take advantage of the growth in the IT-BPO industry. Likewise, existing and emerging locators are on the road to successfully replicating the Philippines’ success, making competition in the industry fiercer, not only in terms of costs, but more importantly, in terms of labor provision and talent management, technology and service innovation, and specialization,” says BPAP senior executive director Gillian Joyce G. Virata.

“This year’s Summit reviews the Road Map and its implications on the Philippines’ position as the new leader in voice — and how it affects the even faster-growing non-voice segment for all locators,” Virata explains.

According to BPAP executive director for industry affairs Raymond Lacdao, the summit will focus on innovation and value creation. “The industry is moving up the value chain rapidly, and clients expect services providers to be their partners in enhancing value for their customers.”

Lacdao says that for this year, they expect to see around 400 executives from the IT-BPO and shared services sectors of 20 countries to participate in the summit’s exhibits, gala dinners, and site tours.


Because of the increased demand for broadband services in Russia, the contact centre outsourcing market focused more on customer care services. This strategy became a factor for the said sector to recover, and develop over the past couple of years.

According to Iwona Petruczynik, a Research Analyst for Frost & Sullivan ICT group, “There is an increasing trend toward the use and deployment of interactive voice response (IVR) and automated service technologies," and adds “It has proven to be a very effective way to reduce cost and enable outsourcing companies to provide more services with the same number of agents.”

On the other hand, majority of consumers are still not comfortable with the new technologies that are being used for customer support operations.  But, according to the observations of Frost & Sullivan, IVR is becoming more and more recognized by technology-literate consumers.  

Concerns in the Russian contact centre outsourcing market

The local Russian call centre (customer support) market is also worried that knowledgeable and qualified employees will be scarce in the upcoming years. Petruczynik brought light to the situation. "Market participants have concerns that there will not be enough young employees to fill in-house call centres and a number of companies will be forced to outsource their services. However, this situation may create a conundrum, as the lack of agent talent could result in in-house centres competing with outsourcers for employees."

Another concern is the deficiency or lack of tools needed for the contact centre industry in Russia to grow substantially. The Russian Government strategized and declared a new policy that supports funding and developing contact centre operation sites in Novosibirsk, Nizhny Novgorod, St. Petersburg, and Dubna.

Now, BPO companies in Russia are working on improving their infrastructure for multimedia contacts, so that they will be able to accommodate the high demands in customer support. But, even with the new technological advancements, “human” and voice-based services still lead the outsourcing industry.



Subic Free Port Steps Up Development

by: Ronald Escanlar

Friday, March 25, 2011 | Outsourcing News | Comments (0)

Subic Free Port Emerging as Services and Logistics Hub

The Subic Bay Metropolitan Authority (SBMA), a former US military base in the northern Philippines, is bent on becoming the region's hub for the services and logistics sectors as they accelerate plans on developing priority investment zones in the sprawling free port complex.
“We are very proud of the fact that we have attracted cumulative investments worth more than $7.16 billion and almost 1,500 investment projects as of 2010. Unfortunately, these investments won’t bring any economic benefit to us if they do not materialize for lack of space,” explains Armand Arreza, SBMA administrator.
Among the zones to be redeveloped is the Subic Gateway Park, which already hosts several business process outsourcing (BPO) companies. Arreza comments that the Subic Gateway Park is ‘emerging to be primarily our business process outsourcing (BPO) center within the next few years.’
Arreza says a 16-hectare area adjacent to the Subic Gateway Park will be developed into the new Gateway Business District, which will offer additional office space to the country’s expanding BPO industry.



PH Congress Oks Data Privacy Bill

by: Ronald Escanlar

Thursday, March 24, 2011 | Outsourcing News | Comments (0)

BPOs in the Philippines on the Lookout for Data Privacy Bill

The Philippine Congress is set to enact House Bill 4115, or the Data Privacy Act of 2011, as the bill passed its third and final reading this week. The country’s booming business process outsourcing (BPO) industry is expected to benefit from the measure, which aims to protect and regulate recording of personal data in information and communication systems in the public and private sectors.
"The bill will also contribute to the promotion and development of electronic commerce in the Philippines and protect the consumers. It will also promote consumer trust and user confidence in electronic commerce through the issuance of clear, transparent, predictable, and enforceable rules to clarify and ensure the protection of personal data in information and communications systems in both the private sector and the government sector," explains Rep. Roman Romulo, author of the bill.
Bill co-author Rep. Susan Yap explained that the state needed to protect the fundamental human right to privacy of communication. "The State recognizes the vital role of information and communications technology in nation building and its inherent obligation to ensure that personal information in information and communications systems in the government and the private sector are secure and protected," the legislator said.
Once signed into law, the bill’s provisions on guaranteed security for personal data will be enforced by the Commission on Information and Communications Technology (CICT). Among the responsibilities outlined for the CICT include the selection and recommendation of the most secure technologies available to protect government databases from cyber attacks. The bill also protects the CICT from criminal or civil suits that may happen in the course of the commission’s protection of personal data.
The bill prescribes that data controllers and processors must use techniques in protecting personal data against accidental or illegal misuse, destruction, disclosure, alteration, or even illegal processing. At the same time, the bill makes it illegal to share personal data with third parties. Violators will be fined by as much as PHP5 million (USD 115,000), the bill prescribes.
The Business Processing Association of the Philippines (BPAP) had earlier lauded the data privacy bill when it passed second reading last month. “The approval of the Data Privacy Act on second reading sends the right signals not only to existing foreign locators in the business process outsourcing industry but also to the many global players which are just deciding whether to invest in our country and participate in the IT-BPO space,” said Martin Crisostomo, BPAP executive director for external affairs.
A counterpart bill was filed in August of last year at the Philippine Senate by Sen. Miriam Defensor Santiago.

PH BPO to grow 20% Annually Thanks to Voice-based work

According to CEO Oscar Sañez of the Business Processing Association of the Philippines (BPAP), an annual growth rate of 20 percent will be seen in the country’s outsourcing industry in the next five years. If this happens, business process outsourcing (BPO) revenues will reach US$25 billion by 2016. Last year, the industry generated approximately $9 billion in revenues.

Sañez is also optimistic about the non-voice sector of the Philippines, saying that it will grow five times in size, as stated in the Roadmap 2016.

The country has long been known as an ideal destination for voice-based or call center work, and it has already dethroned India in that aspect. The industry is now offering non-voice services in the fields of media, health care, finance, accounting, and supply chain management. The Philippines may be considered as the no. 1 location for outsourced call center processes, but overall, India remains the top destination when it comes to outsourcing and offshoring.




PH to Ink Free Trade Deal with EU

by: Ronald Escanlar

Friday, March 18, 2011 | Outsourcing News | Comments (0)

The Philippine government expects to improve and enhance business relationships with European Union countries, especially with the United Kingdom (UK), via a proposed EU-Philippines free trade agreement, reports Adrian S. Cristobal Jr., Philippine trade and industry undersecretary for international trade group.

Philippines already an offshoring destination for outsourced work

Our English-speaking business environment, multicultural sensitivities, and strategic location in Asia are attractive for British companies seeking to expand its business in Southeast Asia,” the official says.
The Philippines is already known in the UK as a viable offshoring destination for outsourced work, especially since the country’s BPO industry has bagged the Offshoring Destination of the Year Award for the years 2007, 2009, and 2010. The awards were given by UK-based National Outsourcing Association (NOA).

“As we work towards the EU-Philippines FTA, we hope that more business and investment opportunities will open up for both countries,” comments Cristobal.

The Philippines already plays host to some of the UK’s biggest companies – HSBC, BP, LogicaCMG, and Shell.



PH to Join Indo-ASEAN FTA

by: Ronald Escanlar

Thursday, March 17, 2011 | Outsourcing News | Comments (0)

The Philippines is about to ratify this month the free trade agreement (FTA) between India and the Association of South East Asian Nations (ASEAN). The FTA, signed in 2009, will lift the tariff on 4,000 items – in effect making the Indo-ASEAN FTA one of the world’s biggest free trade areas.

According to Gregory Domingo, the country’s trade and industry secretary, “We need to do it when the Congress is not in session. All internal processes are complete, and only the President has to sign it. I am hopeful that it will happen by the end of this month.” The Philippine Congress will be adjourning their session this March 25.

Ongoing negotiations for a parallel agreement on services and investment

Negotiations are also ongoing for a parallel agreement on services and investment. At present, trade in the services sector between India and ASEAN countries (Cambodia, Brunei, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam) stands at $50.34 billion. An FTA could boost this trade to around $70 billion by next year.

Indian commerce and industry Minister Anand Sharma said they expect an agreement on services and investments by the end of the year, expanding the current FTA to a Comprehensive Economic Partnership Agreement. Domingo, on the other hand, said there were still issues. “We are going to try and complete negotiations for the services and investment agreement, and we are already trying to resolve the issues. There is a possibility (of meeting the timeline) but it may be difficult.”

The Philippines, at first, was wary of the domestic effects of a services agreement. However, Domingo explained that better bilateral relations, especially in the services sector, could improve existing economic relationships, considering that major Indian IT companies, such as Tata Consultancy Services, Infosys, Wipro, and Aditya Birla Minacs, have already set up offices in the country.

“Our linkage with India hasn’t been that strong and, across the board, trade and investment is under-represented. We need to purse this issue more vigorously. But in the BPO and call-centre sectors, a lot of large Indian players are in the Philippines. This is the first step and we are starting to build it up from there,” Domingo explained.


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