Overview: Outsourcing to the Philippines

Apparently, Philippines’ top-notch standing in the global outsourcing industry has already become prominent amongst the principal sectors in the business world. The Philippines has been contending with the leader of the industry, India, and recently made a huge milestone that makes its people proud.

The latest report from Tholons, a US-based strategic consulting company for global outsourcing and investments, entitled “2013 Top 100 Outsourcing Destinations” showed off how Philippines’ outsourcing industry has been doing for the last 6 years and how it remarkably performed in the latest year. Philippines lately received a gigantic achievement of becoming one of the Top 3 outsourcing destinations around the world. Overtaking the place of Delhi (India), Manila (Philippines) had a +1 movement from last year’s report. Aside from Manila, there are more cities in the Philippines which were included in the Top 100 – Cebu, Davao, Santa Rosa (Laguna), Iloilo, Bacolod and Baguio City. Among those 7 cities included, 5 increased in rankings which is a great indicator that outsourcing continues to bloom in the country as years go by. 

Wikipedia and Outsourcing Insider really make brilliant explanations on how Philippines has become competent in this industry. But considering those things in mind, what could be the most common reasons why more and more companies tend to outsource their processes to the Philippines? Below could be the top 3 reasons:

•       Diverse Culture. Filipinos can easily adapt to different cultures since it has been colonized by foreign countries for a long time. Plus, English is included in the curriculum programs which also makes it the 2nd official language of the country. This makes them more proficient on using the English language compared to its country neighbors.
•       It’s affordable to outsource in the Philippines. Instead of hiring employees locally, most entrepreneurs find it cheaper to outsource processes to the Philippines. Overhead costs decrease and savings continue to increase up to more than 50%.
•       Filipinos carry the entire, ideal package. When finding an outsourcing partner, companies prefer those who are more reliable, credible and capable of doing tasks with care and competency. Filipinos are best known for their values and amazing skills. They carry integrity, teamwork, creativity, trustworthiness and dependability. Aside from being highly skilled and knowledgeable, these values make Filipinos the ideal outsourcing package.

These reasons above might be true for a lot of businesses out there but people shouldn’t ignore the fact that everybody still has different perceptions when it comes to this. Philippines’ outsourcing companies certainly have more time to prove what they got and why the country deserves the number one spot.

However, how do you think this enormous rise affected the competing countries? How should they overcome such challenges?