At the front of the back office
How the Philippines beat India in call centres
IT S midnight in Manila, and the capital is justwaking up to the start of another working day. Atthe Worldwide Corporate Centre office block,thousands of young Filipinos are crowding into endless open-plan offices. Once seated, theyquickly start answering the questions and calming the frustrations of vexed Americanconsumers beginning their own day on the other side of the Pacific Ocean.
These Filipinos are call-centre workers. To outsiders it is hardly a glamorous profession, yetdespite the antisocial hours these men and women have every reason to be as well-motivated and cheerful as they seem. They are well paid and know that they work at theheart of their country s most dynamic industry.
The rise of what is known as business-process outsourcing in the Philippines has beennothing short of phenomenal. The very first calls were taken in 1997; today the sectoremploys 638,000 people and enjoys revenues of $11 billion, about 5% of the country s GDP.Last year the Philippines even overtook India, long the biggest call-centre operator in theworld, in voice-related services . The country now employs about 400,000 people at callcentres, India only 350,000.
The South-East Asian upstart is unlikely ever to surpass the SouthAsian behemoth across the entire range of outsourcing offerings, which alsoinclude all kinds of information-technology services. Yet given the extraordinary growth sofar it is hard to gainsay the Philippines own projection that its BPO industry could addanother 700,000 or so jobs by 2016 and generate revenues of $25 billion. At that point, theindustry would make up nearly a tenth of GDP and be bigger in value than the remittancesfrom the 10m Filipinos working overseas.
As in the call-centre business so far, some of these new jobs will come at the expense ofIndia. Yet India s relationship with the Philippines in back-office work is more complex thanthe numbers suggest.
The main reason for the success of the Philippine call centres is that workers speak Englishwith a neutral accent and are familiar with American idioms—which is exactly what theirAmerican customers want. Of these, many have taken to complaining bitterly about Indianaccents . As aresult, the Indian firms themselves have been helping to move jobs to the Philippines bysetting up call centres in Manila and other parts of the country. Infosys and Wipro, as well asscores of other Indian firms, now have substantial operations there. And they aren t drawnto Manila by cheap labour. Wages in the Philippines are slightly higher than in India since theFilipino accent commands a premium.
It also helps that the country has a big pool of well-educated workers. The million or soFilipinos who graduate every year have few other options to choose from, besidesemigrating. And working in a call centre is considered a middle-class job .
The big question is whether the Philippine BPO industry, having conquered the call-centremarket, can now move up the value chain. To keep growing rapidly-and profitably-it needs tocapture some of the more sophisticated back-office jobs, such as those processinginsurance claims and conducting due diligence. In these businesses, called knowledge-process outsourcing and legal-process outsourcing, India still rules supreme.
Integreon offers a glimpse of what the future may hold. The firm occupies just a fewdiscreet, very secure offices. It employs 300 people in Manila, 40 of them lawyers who helpmultinational law firms with litigation. Familiarity with America helps. It makes it very easyfor us to do legal research for American firms, says Benjamin Romualdez, the firm s countrymanager.
让我们看看Integreon公司将会发生些什么。这个公司仅仅只占用了几个不起眼的安全的办公室。他在马尼拉有300名雇员，其中40人是律师，帮助跨国的律师事务所进行诉讼。精通美国诉讼。 它让我们能够轻松的对美国的公司进行法律研究， 该公司的区域经理Benjamin Romualdez说。
This sort of operation is new in Manila, but Mr Romualdez expects that he can find the skilledworkers to double his workforce over five years. Western banks have also discovered thePhilippines. JPMorgan Chase now has over 25,000 workers on its own payroll in the country,many of whom do much more than answering phones. The Philippines is set to compete withIndia across the BPO board.