Why India Lost the BPO Industry to Philippines?

Today, the Philippines is the world’s leading BPO (business-process outsourcing) industry, beating out India. In just a span of three years, India lost almost its entire market share to Philippines.

What might be the factors that made the Philippines BPO industry grow at a faster pace? The reasons behind it are:

  • Cultural compatibility – The culture of the Philippines is very similar to that of Western countries like the US and the UK. In this way, they are able to understand other cultures and adapt them easily.
  • Neutral accent – Philippine accent is close to the US and the UK accent and this is where they benefited when it comes to call centres.

These are some of the main reasons that forced Western countries to outsource their needs to Philippines (which most of us are aware of), but other than these reasons there are many other major reasons why Philippines took over the call-centre segment from India. They are:

  • Philippines had strong support from the government – For any business to flourish or even survive, government support is very important. This is where half the battle was won by the Philippines in taking over the BPO industry from India. It had strong government support in the form of tax exemptions to foreign investors and supported the outsourcing industry to have its roots in city centre.

  • The Philippines focused BPO jobs in city centre like Manila, Cebu, Mandaluyong and Taguig. Interestingly, 90% of SEZs in Philippines are operating out of existing buildings and they have invested in the city centre and have extended SEZs to include buildings in the city centre.

    Philippines have used their existing infrastructure in the city centre to generate more jobs, but in India existing infrastructure in city centre is ignored badly by the government and new buildings and facilities are constructed on the outskirts of the city and for this full support is given by the government. Lot of wasteful expenditure.

  • Indian employees have unreasonable expectations – As the BPO jobs in India have shifted to outskirts of the city, many companies are forced to provide pick and drop facility for the employees and because of this unreasonable expectations, the employees think that the company owes them something just because they work here. And this attitude is the reason why our employees are not able to provide high-productivity, advanced critical thinking and analytical skills.
  • Philippines are service-oriented hospitality and devotion to work – Filipinos by nature are hard working. Their devotion towards work and and their ability to work all around the clock makes them ideal for outsourcing. They also have problem solving and decision making skills to solve and analyse the situation.

As the Philippines’ BPO industry is flourishing with its hard work and government support, India’a BPO industry is in trouble. We need to learn a few lessons from the Philippines on how to support its people and businesses. Hope somebody is listening!

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