Business Process Outsourcing (BPO) to the Philippines has been growing over the past two decades as businesses have used it to realise lower costs while improving customer service and satisfaction. However, many with a traditional view of the industry have expected the growth of digital, as well as the impact of the COVID-19 pandemic, to have disrupted the industry, ending over two decades of rapid growth. Nevertheless, the BPO sector in the Philippines has been able to leverage its traditional strengths and is benefiting from a period of digitally driven growth.
Digital encompasses a whole range of businesses.While the model is usually centred around a set of digital facing tools and apps for the customer, behind this sit many elements that will be familiar to any business. A digital company, whether established or start-up, will be as reliant on back-office processes like enterprise data management as any other, and perhaps even more reliant when it comes to customer support. Even the most advanced AI bots can only go so far. With its well established and professional BPO industry, the Philippines was already well-placed to service those needs.
"The COVID-19 pandemic has massively accelerated the growth of digital. Although digital delivery was commonplace before the pandemic, business models were still mostly delivered through traditional methods that wouldn't have looked out of place at the turn of the 20th century. From retail to finance, businesses were centred on bricks-and-mortar outlets with some online access. The pandemic has accelerated the trend of turning that on its head. There is no point having a bank that people cannot enter or feel unsafe using. And if you are getting food delivered it does not matter if the kitchen is attached to a fancy restaurant or in an industrial unit," says Ralf Ellspermann, CEO of PITON-Global, a leading BPO provider in Manila, Philippines.
"Digital businesses were uniquely placed to take advantage of the new landscape, offering platforms and services that were already contact-less and were not dependent on adapting existing ways of working. However, their growth could not take place without the support of the BPO industry in the Philippines that could meet the growing demands of customers and their need for quality services," says Ellspermann.
The Philippines established itself as a world leader as a result of a unique set of qualities it could offer businesses that needed outsourcing. Lower costs were a chief attraction; with lower labour costs the Philippines could typically offer the same service at around half the price of domestic options. However, this was provided without any sacrifice quality. With a highly educated population and a high level of English fluency, BPO providers in the Philippines could service the English-speaking economies of the US, UK, Singapore, and Australia without the communication problems associated with BPO elsewhere.
Perhaps most importantly, the BPO industry in the Philippines was well-placed to scale rapidly. As one of the major sectors of the Philippines economy there is already a large, experienced workforce of over 1.2 million Filipinos at all levels in the BPO sector. When combined with the educated population, the sector was more than capable of addressing the huge increase in demand from the digital sector.
The traditional strengths of BPO in the Philippines, which despite the lower costs still offer exceptional and reliable customer service, remain relevant even with increased digitally driven demand. Ellspermann explained, "we have seen an exponential increase in enquiries from companies thriving in the digital space. But they all have one thing in common: they want cost savings, but without losing any focus on quality. And I think that's the key to successful business process outsourcing."
Digital may be increasing the share of customer interactions, but it seems that ultimately, all companies rely on having high quality BPO solutions to support them. BPO companies in the Philippines are finding that the qualities that helped them thrive over the last 20 years are still proving valuable in the digital age.